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VoIP vs. SIP: Differences and Which One Is Best for Your Business

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<p><span style="font-weight: 400;">Every business needs a comprehensive communication solution to ensure reliable internal and customer-facing contact. When it comes to researching which business phone system will best meet your needs, it can get confusing because there are so many unfamiliar terms and acronyms.</span></p>
<p><span style="font-weight: 400;">One question business owners are often left with is whether they should go for a VoIP system or a SIP one. It’s not a direct comparison and they can work together to support high-quality telephony. So let’s get into what they are and how they compare.</span></p>
<h2><span style="font-weight: 400;">What is VoIP?</span></h2>
<p><a href="https://www.podium.com/article/voip-tips-for-success/"><span style="font-weight: 400;">Voice over internet protocol</span></a><span style="font-weight: 400;"> is a phone system that enables voice calls over the internet. There’s no need for phone lines or the Public Switched Telephone Network (PSTN) like with traditional landlines. VoIP technology can translate voice signals into data packets which can be sent over digital networks and translated back into audio for the receiver.</span></p>
<p><span style="font-weight: 400;">This makes VoIP calls a lot more accessible to small businesses because they just need simple hardware such as mobile devices, a VoIP service provider, and reliable broadband. As a wireless phone service, it’s perfect for teams on the go that don’t want to be weighed down by desk phones.</span></p>
<h2><span style="font-weight: 400;">What is SIP?</span></h2>
<p><span style="font-weight: 400;">Session initiation protocol or SIP deals with various types of data packets, enabling multimedia communications. As SIP handles multimedia communication sessions, users can communicate through voice calls, video calls, SMS, and more. The endpoints SIP transfers data between may be internet-connected. Or by using SIP trunking, it can also connect with landline phone numbers.</span></p>
<p><span style="font-weight: 400;">This gives businesses a lot more freedom in how they communicate. Sometimes voice communications are enough but some teams prefer to keep in contact through instant messaging and video conferencing as well.</span></p>
<h2><span style="font-weight: 400;">What is the difference between SIP and VoIP?</span></h2>
<p><span style="font-weight: 400;">The main difference between SIP and VoIP is the role they play in communications. VoIP refers to running voice calls over the internet. SIP encompasses the protocol for establishing, maintaining, and disconnecting communication sessions such as VoIP communications. Therefore, you can use both. A</span><a href="https://www.podium.com/article/voip-vs-landline/"><span style="font-weight: 400;"> VoIP service</span></a><span style="font-weight: 400;"> provides internet-based voice call capabilities, often using the protocol SIP. A SIP service provides multimedia communications including VoIP.</span></p>
<h3><span style="font-weight: 400;">Technology</span></h3>
<p><span style="font-weight: 400;">The technology used to power a VoIP phone system is different from that of a SIP system. VoIP just needs to be able to turn audio into data packets, transfer it over the internet, and turn it back into audio for the receiver to listen to. SIP systems use technology to transfer and manage multimedia communications over the internet and connect with traditional phone lines through trunking.</span></p>
<h3><span style="font-weight: 400;">Functionality</span></h3>
<p><span style="font-weight: 400;">SIP protocol has much wider functionality. It allows users to communicate through voice calls, video calls, and messaging. It is a unified communications system because multiple communication channels are managed together. VoIP phones limit users to voice-based communication unless the provider offers additional features.</span></p>
<h3><span style="font-weight: 400;">Scope</span></h3>
<p><span style="font-weight: 400;">SIP’s scope includes voice-based and text-based communication through an internet connection or PSTN. VoIP has the scope to maintain voice calls over the internet and using wireless devices like laptops, cell phones, and any mobile device compatible with the provider’s app.</span></p>
<h3><span style="font-weight: 400;">Interoperability</span></h3>
<p><span style="font-weight: 400;">Beyond the embedded communication channels, the SIP trunking service creates a connection between the internet-based transmission of communication data and traditional telecommunication through PSTN. The integration possibilities of VoIP depend on the service provider. Some providers only offer basic voice call capabilities while the VoIP phone within the </span><a href="https://www.podium.com/article/small-business-telephone-solution/"><span style="font-weight: 400;">Podium platform</span></a><span style="font-weight: 400;"> integrates with </span><a href="https://www.podium.com/text-marketing/"><span style="font-weight: 400;">text</span></a><span style="font-weight: 400;">, webchat, </span><a href="https://www.podium.com/contacts/"><span style="font-weight: 400;">CRM functionalities</span></a><span style="font-weight: 400;">, and more. </span></p>
<h2><span style="font-weight: 400;">VoIP vs. SIP Pros and Cons</span></h2>
<p><span style="font-weight: 400;">If you’re considering setting up a VoIP or SIP phone system, bear in mind these pros and cons. </span></p>
<h3><span style="font-weight: 400;">VoIP Phone Pros</span></h3>
<ul>
<li><span style="font-weight: 400;">Cost savings</span></li>
<li><span style="font-weight: 400;">Easy set up</span></li>
<li><span style="font-weight: 400;">Flexibility (can manage from an app)</span></li>
<li><span style="font-weight: 400;">Integrations</span></li>
<li><span style="font-weight: 400;">Additional features (e.g., text messaging, central inbox)</span></li>
</ul>
<h3><span style="font-weight: 400;">VoIP Phone Cons</span></h3>
<ul>
<li><span style="font-weight: 400;">Requires internet connection and power</span></li>
<li><span style="font-weight: 400;">Emergency calling limitations</span></li>
</ul>
<h3><span style="font-weight: 400;">SIP Phone Pros</span></h3>
<ul>
<li><span style="font-weight: 400;">Centralized business communications</span></li>
<li>Customizable to your business needs</li>
<li><span style="font-weight: 400;">Scalability</span></li>
<li><span style="font-weight: 400;">Cost-effective</span></li>
</ul>
<h3><span style="font-weight: 400;">SIP Phone Cons</span></h3>
<ul>
<li><span style="font-weight: 400;">Relies on internet connection</span></li>
<li><span style="font-weight: 400;">Complex implementation and configuration (e.g., s</span><span style="font-weight: 400;">etting up a PBX) </span></li>
<li><span style="font-weight: 400;">Security considerations</span></li>
</ul>
<h2><span style="font-weight: 400;">How to Choose Between VoIP and SIP?</span></h2>
<p><span style="font-weight: 400;">For most businesses, VoIP is the best option because it’s flexible, accessible, and easy to use even for small startups. Here’s the best way to choose your business phone solution. </span></p>
<h3><span style="font-weight: 400;">1. Define your communication needs.</span></h3>
<p><span style="font-weight: 400;">What does your business need for successful communication? Your needs could fit within the parameters of a </span><a href="https://www.podium.com/article/what-is-a-voip-number/"><span style="font-weight: 400;">VoIP provider</span></a><span style="font-weight: 400;"> with a platform that includes text messaging and instant messaging alongside voice calls. Your team might prefer to manage calls including re-routing and queuing within an app which is possible with VoIP.</span></p>
<p><span style="font-weight: 400;">Or your business needs may better suit a SIP provider that offers UCaaS tools. It works particularly well if you already have an IP PBX on site that can be set up for VoIP using a SIP trunk.</span></p>
<h3><span style="font-weight: 400;">2. Consider scalability and future growth.</span></h3>
<p><span style="font-weight: 400;">Don’t just meet your current communication needs. Keep in mind your vision for the future of your business. You may want to start with just voice calls but in the future, you may have the capacity to also offer a text messaging service for clients. Or you may aspire to set up an office in a different location making video calls important for connectivity.</span></p>
<h3><span style="font-weight: 400;">3. Assess integration and compatibility.</span></h3>
<p><a href="https://www.podium.com/article/phone-systems-for-small-businesses/"><span style="font-weight: 400;">Different service providers</span></a><span style="font-weight: 400;"> offer different integrations. Whether going for VoIP or SIP, you need a phone system that is compatible with the other tools you use in the business. Streamlining communications, customer service and sales processes make a real difference in productivity and business outcomes.</span></p>
<h3><span style="font-weight: 400;">4. Evaluate cost and budget.</span></h3>
<p><span style="font-weight: 400;">Generally, the pricing of VoIP phone systems is more affordable than SIP phone systems because SIP has more hardware and software to set up. If you already have company computers or cell phones, you can quickly get started with a VoIP provider just through their app. What can you invest in your business communications?</span></p>
<h2><span style="font-weight: 400;">The Best Phone System for Business Growth</span></h2>
<p><span style="font-weight: 400;">Podium’s VoIP phone system is built with small businesses in mind. We know how much of a challenge it can be to respond to interactions quickly over multiple communications platforms. That’s why we’ve set up our phone system to automatically route to an omnichannel inbox where you can also access all your webchat, text, and social media messages among other communication channels.</span></p>
<p><span style="font-weight: 400;">Every touch point in the customer journey is managed in a singular system, maintaining a full picture of business communications and enabling integrated organization of customer data. You can be responsive without missing a thing.</span></p>
<p><span style="font-weight: 400;">The success story of </span><a href="https://www.podium.com/customer-stories/budget-blinds/"><span style="font-weight: 400;">Budget Blinds of Salt Lake and Davis Counties</span></a><span style="font-weight: 400;"> is just one example. With Podium Phones they were able to increase their sales close rate by 33% and save over 10 hours a week by routing 25% of calls to text.</span></p>
<p><span style="font-weight: 400;">If you’re interested in an all-inclusive platform, give </span><a href="https://www.podium.com/phones/"><span style="font-weight: 400;">Podium Phones</span></a><span style="font-weight: 400;"> a go.</span></p>
<h2><span style="font-weight: 400;">VoIP vs. SIP FAQs</span></h2>
<h3><span style="font-weight: 400;">Q: Is VoIP the same as SIP?</span></h3>
<p><span style="font-weight: 400;">A: No, not exactly. VoIP technology allows you to have voice calls over the internet instead of relying on phone lines. SIP is a communications protocol that deals with voice calls both over the internet and using traditional phone lines as well as other multimedia communications such as video calls and instant messaging.</span></p>
<h3><span style="font-weight: 400;">Q: What is SIP trunking?</span></h3>
<p><span style="font-weight: 400;">A: SIP trunking expands the capabilities of IP telephony by connecting the phone system to both the internet and the PSTN. That means the phone service can be used to call internet-based phone numbers and traditional telephone lines.</span></p>
<h3><span style="font-weight: 400;">Q: Is SIP used in VoIP?</span></h3>
<p><span style="font-weight: 400;">A: SIP is the protocol for how communications data is transferred. That data could be a voice call transferred over the internet, therefore VoIP, or another multimedia communication. SIP can also be used to connect VoIP with PSTN enabling calls to landlines through SIP trunking.</span></p>
<h3><span style="font-weight: 400;">Q: Can you have VoIP without SIP?</span></h3>
<p><span style="font-weight: 400;">A: Yes, that’s possible. While SIP is a common communication protocol that handles voice calls over the internet, there are other internet protocols VoIP providers can use to enable internet-based voice calls.</span></p>


VoIP vs. SIP: Differences and Which One Is Best for Your Business

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