SIP phones are fast becoming the main topic of discussion for business owners who want to grow and scale their communications services. Companies looking to expand their phone service are making a switch to cloud-based phone service, providing their staff and customers a seamless way to communicate more effectively.

Phone services do not usually get much allocation from a company’s budget because of other tools. However, SIP phones have become a buzzword in today’s telecommunication industry, and businesses are looking to key into it. This article will go through what SIP phone means, how it works, how to set it up, and the benefits for your business.

What are SIP Phones?

SIP stands for Session Initiation Protocol, and it is a communications protocol for integrating multimedia communication sessions. SIP phones use the Open Standard “SIP” network to set up and manage voice calls and other basic phone capabilities with web, email, and online messaging.

The actual voice is carried over an IP-based network using another Open Standard called “RTP. ” SIP phones are sometimes called VoIP Phones or VoIP Clients since the protocols are generically termed “VoIP” (voice-over-internet-protocol).

The SIP protocol enables businesses to have unified communications as it allows for integrations, helping you scale beyond just voice calls.

How Does SIP Phone Work?

When a call is made, the SIP server that the SIP phone is connected to is notified. This server is your business VoIP service. The SIP server then initiates contact with another extension or patches the call over to the Public Switched Telephone Network (PSTN). The call is established when the recipient answers the phone.

During the call, the SIP server and phones negotiate the call quality and status in real-time. SIP devices operate using commands that work similarly to how HTTP traffic accesses web pages.

Types of SIP Phones

There are two types of SIP Phones:

  • Hardphones or Hardware SIP Phones.
  • Softphones or Software SIP Phones.

Both SIP phones can only work with cloud-based phone systems, and unlike traditional phones, they have many advanced benefits.

Hardware SIP Phones

Hardware SIP Phones work like a regular telephone but make phone calls through an IP network instead of PSTN lines. They connect to an IP-Network using ethernet cables or WiFi. SIP phones can also share the existing data network with your computer without needing extra internet service.

 Hardware SIP Phones are classified into basic, intermediate, and advanced categories.

  • Basic – the basic hardware phones are those commonly used by contact center agents. They are a starter VoIP phone, budget-friendly, and easy to use.
  • Intermediate – they have extra VoIP features that offer more functionality than basic. They also have a browsable directory with multiple extensions and are often given to employees.
  • Advanced – besides doing what a basic or intermediate phone does, Advanced SIP hard phones look more visually appealing with a full-color display, multiple extensions, WiFi or Bluetooth compatibility. Popular hardware SIP phones include Grandstream, Polycom, etc.

Software-Based SIP Phones

Software-based SIP phones are the software applications installed onto your desktop, laptop, or smartphone that allow you to make phone calls over the internet. Simply put, a software SIP phone is a software program that provides telephone functionality.

Any smart device with a microphone and speaker can function as a softphone. The only prerequisite is an IP-based connection to a VoIP Provider or a SIP Server, as a softphone uses the Open Standards protocols SIP and RTP for call setup and voice delivery. Once your VoIP app is installed, you’re good to go.

Users may install a softphone themselves, or administrators can be a guide. Popular software SIP phones include Wengo, XLite from Counterpath, etc.

Advantages of SIP Phones

 No matter the size of your company, the best SIP phones are one of the most versatile and cost-effective options available to you. Here are the advantages of SIP Phones:

  • Cost-Effective
  • Mobility
  • No maintenance or additional configuration
  • Employees are connected in and out of the office
  • Encryption for increased call security.
  • Cloud-based storage and management of your phone system data
  • Smooth Integration with CRM and business applications

Disadvantages of SIP Phones

Every device has its pros and cons. SIP-enabled phones need both electricity and the internet to operate. When the power is down, they can’t work. Also, if the internet speed is slow, the quality of SIP calls is reduced. Here are a few disadvantages of SIP Phones:

  • Dependency on Electricity
  • Slow network speed can affect the quality of calls
  • Hardware maintenance

How Do I Setup a SIP Phone?

Here’s how to set up a SIP Phone in four steps:

1. Gather user credentials.

Get user information from your hosted VoIP provider. Most provide an administrative portal on the web where you can log in to find them. For each user, this information usually includes the user’s SIP address, SIP password, and outbound proxy.

2. Log into the SIP phone via a web browser.

Each SIP device has an IP address. Check your phone’s user manual for where to find the phone’s IP address and how to access the web interface to access the phone’s settings.

3. Enter the user’s information in the phone’s settings.

Enter the information into the settings fields and save it. Reboot the phone for the settings to take effect.

4. Confirm that your SIP phone is successfully registered.

If your provider has an admin portal, check for confirmation that the phone is registered, active, or online.

What’s the Difference Between a SIP Phone and a VoIP Phone?

SIP Phones are also known as VoIP Phones. The term “VoIP phones” is a generic term for specialized phones that send voice calls over the internet, and SIP is one of them. SIP is one protocol used to connect the people in a VoIP call. So SIP requires VOIP, but VOIP doesn’t require SIP.


As you decide on the SIP device you need for your company’s communications needs, consider the sip trunk provider first, and then the SIP phone. The service provider most influences your company’s experience. Ensure there is maximum reliability and that every necessary thing is in place for the smooth running of your business.