Microsoft Teams Direct Routing Australia — Technical Guide

Direct Routing is the more flexible — and more technical — of the two ways to connect Microsoft Teams to the public phone network. Where Operator Connect keeps everything inside Microsoft's certified carrier programme, Direct Routing lets an Australian business bring almost any SIP carrier to Teams, keep existing trunk agreements, and run complex telephony that the simpler option cannot support.

This guide is written for IT managers and decision-makers evaluating Direct Routing specifically: what it is, how it works technically, how it compares to Operator Connect, and when it is the right choice. If you are still weighing up Teams Voice as a whole, start with our broader guide, Microsoft Teams Voice Australia — How It Works. If you are ready to implement, Mycelium 365 implements both Direct Routing and Operator Connect — see our Microsoft Teams Voice service for implementation and pricing.

What is Microsoft Teams Direct Routing?

Direct Routing is one of two methods for connecting Microsoft Teams to the PSTN (the public phone network) — the other being Operator Connect. With Direct Routing, a Session Border Controller (SBC) sits between Teams and a PSTN carrier's SIP trunk, translating signalling between the two systems so that calls placed inside Teams reach ordinary phone numbers, and inbound calls to your business numbers ring in Teams.

Architecturally, the call path is: Teams client → Microsoft 365 Phone System → SBC → SIP trunk → carrier → PSTN. The SBC handles the protocol translation (Microsoft uses a specific SIP profile that not all carriers speak natively), media encryption, and security boundary functions. Microsoft certifies specific SBC models and firmware versions for Teams Direct Routing — only certified combinations are supported, which matters when selecting hardware or a cloud SBC provider.

The SBC itself can take three forms: a physical appliance installed on-premises, a virtual appliance running in Azure, or a cloud-hosted SBC provided as a managed service by a specialist. That choice has cost, maintenance, and resilience implications, covered in the SBC section below.

One point that often surprises teams evaluating Direct Routing: it is not an either/or decision at the tenant level. A single Microsoft 365 tenant can run Operator Connect for most users while routing specific sites or call flows through Direct Routing — useful when, for example, a head office keeps a Telstra SIP trunk while branch offices move to Operator Connect. The routing is controlled per user through voice routing policies, so mixed deployments are a normal, supported pattern rather than an edge case.

Microsoft Teams as a Cloud PBX — replacing your phone system

Microsoft Teams, combined with Direct Routing or Operator Connect, functions as a fully hosted cloud PBX (Private Branch Exchange) — replacing traditional on-premises phone systems and legacy hosted telephony services. For Australian businesses, Teams as a cloud PBX means:

• inbound and outbound PSTN calls through your existing Teams client;
• extension-to-extension calls between staff at zero cost;
• call queues and auto-attendants managed through the Teams Admin Centre;
• voicemail integrated into Microsoft 365;
• call recording for compliance.

Unlike traditional PBX systems, there is no hardware to maintain and no separate phone system vendor to manage — your IT provider manages the calling plan alongside your Microsoft 365 environment. Mycelium 365 deploys and manages Microsoft Teams as a cloud PBX for Australian businesses — contact us for a quote.

Direct Routing vs Operator Connect — the technical differences

Infrastructure. Direct Routing requires an SBC — physical, virtual, or cloud-hosted. Operator Connect requires no hardware at all: the certified carrier's network peers directly with Microsoft, and everything is configured in the Teams admin centre.

Carrier flexibility. Direct Routing works with any SIP carrier that meets Microsoft's requirements, including carriers with no Microsoft relationship. Operator Connect is limited to Microsoft-certified carriers — in Australia, primarily Telstra and Optus.

Call cost. Direct Routing typically delivers lower per-minute rates, because you negotiate directly with the carrier or keep an existing wholesale agreement. Operator Connect is usually sold as bundled call plans with included minutes — simpler to budget, but often dearer per minute at volume.

Complexity. Direct Routing is genuinely more complex: SBC deployment and maintenance, SIP trunk configuration, dial plans, voice routes, and firmware currency all sit with you or your IT partner. Operator Connect removes almost all of that — number assignment and call plans are managed in the same admin centre as everything else in Teams.

Hybrid telephony. Direct Routing supports coexistence with a legacy PBX during a staged migration — calls can route between Teams users and PBX extensions through the SBC. Operator Connect is cloud-only: there is no bridge to on-premises telephony.

Number porting. Both options support porting existing Australian numbers. With Direct Routing the port goes to your SIP carrier; with Operator Connect it goes to the certified carrier. Timelines are similar — typically two to four weeks.

Emergency calling. Both comply with Australian emergency calling requirements, but the configuration paths differ. Direct Routing requires emergency calling configuration on the SBC and trunk, with location information managed per site. Operator Connect carriers handle more of this within their networks.

Management and patching. Direct Routing introduces an ongoing operational responsibility: the SBC firmware must stay within Microsoft's certified version window, certificates for the TLS connection to Teams must be renewed before expiry, and configuration changes (new number ranges, routing changes, failover adjustments) are made on the SBC rather than in a portal. Operator Connect shifts almost all of this to the carrier and Microsoft. This is the main reason many Australian SMBs pair Direct Routing with a managed service or a cloud SBC rather than running it in-house.

Call recording and compliance. Businesses with call recording obligations — financial advice, for example — can integrate compliant recording platforms with either option, but Direct Routing gives finer control over media forking at the SBC where that is required.

When Direct Routing is the right choice for Australian businesses

Direct Routing suits businesses that:

• Have an existing SIP trunk agreement they want to retain. Keeping the contract avoids early termination fees and, in some cases, avoids number porting entirely — the numbers already sit with the carrier.
• Need lower per-minute call rates than Operator Connect plans offer. Call centres, recruiters, and other high-volume diallers usually save meaningfully at volume.
• Are migrating from a legacy PBX in stages. Direct Routing supports coexistence — Teams users and PBX extensions can call each other while departments migrate in waves.
• Require complex call routing that Operator Connect does not support — multi-level IVR, integration with analogue devices (paging, lift phones, door intercoms), or bespoke routing logic.
• Have specific carrier requirements. Some Telstra enterprise contracts and pricing arrangements are not available through Operator Connect; Direct Routing lets you keep them.

If none of these apply, Operator Connect is usually the better answer — simpler, faster, and cheaper to run for a straightforward deployment.

Session Border Controllers (SBCs) for Teams Direct Routing in Australia

The main Microsoft-certified SBC options seen in Australian deployments:

AudioCodes — the most common in the Australian SMB market. The Mediant range covers physical appliances (Mediant 500/800/1000) and virtual editions for Azure. Strong local support and a long Teams certification history.

Ribbon Communications — the SBC SWe Lite and Edge ranges, with a solid reputation in carrier-grade environments.

Oracle — the Acme Packet line, more common in large enterprise and carrier deployments than SMB.

Cloud SBCs — AudioCodes Live and Ribbon Connect deliver the SBC as a managed cloud service, eliminating on-premises hardware entirely. The provider maintains the SBC, keeps firmware certified, and hosts it in Azure close to the Microsoft network.

For most Australian businesses under 200 users, a cloud SBC is the recommended approach: no hardware to buy or maintain, updates and certification managed by the provider, and Azure hosting gives low latency to the Microsoft network. On-premises SBCs still make sense where legacy integration (analogue lines, local survivability) demands equipment on site.

SIP trunks for Teams Direct Routing in Australia

Compatible Australian SIP trunk providers for Teams Direct Routing include Telstra SIP Connect, Optus SIP (where available), Vonex, Symbio Networks, Vocus, and others. When choosing a provider, also consider trunk capacity (concurrent call channels), whether the provider can present your existing numbers as caller ID before porting completes, and their support model during cutover — a carrier with a 24/7 Australian network operations centre is worth having when a port window runs overnight.

The trunk itself must meet three key requirements:

1. G.711 codec support — the baseline audio codec for PSTN interoperability.
2. SRTP/TLS encryption — Microsoft requires encrypted signalling (TLS) and encrypted media (SRTP) on the Teams-facing leg of the SBC, and reputable carriers support it on the trunk side.
3. Australian emergency calling compliance — the trunk must correctly present caller location and route 000 calls.

Mycelium 365 works with the major Australian SIP trunk providers to configure and manage Direct Routing deployments, including negotiating trunk capacity and call rates where an existing agreement is not in place.

Direct Routing implementation — what the process looks like

A typical implementation runs in this order:

1. SBC selection and procurement — cloud or on-premises, sized for concurrent call volume with headroom.
2. Microsoft Teams Phone licence assignment — the approximately $11/user/month add-on (included in E5) for every user who will make or receive PSTN calls.
3. SBC configuration and Microsoft tenant pairing — the SBC is registered to the Microsoft 365 tenant and certificates are exchanged for the TLS connection.
4. SIP trunk provisioning with the carrier — trunk credentials, capacity, and number ranges are ordered and tested.
5. Dial plan configuration — number normalisation rules for Australian dialling patterns (eight-digit local numbers, 0-prefixed national and mobile, +61 international format).
6. Voice routing policies — which users route calls via which trunks, including least-cost routing where multiple carriers are used.
7. Auto attendant and call queue setup — IVR menus and hunt groups rebuilt in Teams.
8. Emergency calling configuration — per-site location information, the Australian equivalent of the obligations overseas frameworks such as RAY BAUM'S Act formalise, so 000 calls from any office present the correct address.
9. User testing — inbound, outbound, transfers, voicemail, and failover scenarios.
10. Number porting cutover — numbers move to the trunk in a scheduled window, typically overnight.

Because every call path depends on the internet connection between the user and Microsoft, Direct Routing requires a reliable, low-latency connection — see managed business internet for how a monitored, business-grade service removes the most common cause of call quality complaints. Ongoing administration — user changes, call flows, carrier liaison — is included in the Modern Workplace package.

Frequently Asked Questions

What is Microsoft Teams Direct Routing?

Teams Direct Routing connects Microsoft Teams to the PSTN (phone network) using a Session Border Controller (SBC) between Teams and a SIP trunk carrier. It allows businesses to use any compatible SIP carrier — not just Microsoft-certified Operator Connect carriers — giving more flexibility over carrier choice and call pricing.

When should Australian businesses choose Direct Routing over Operator Connect?

Direct Routing suits businesses with existing SIP trunk agreements they want to retain, those needing lower per-minute call rates than Operator Connect plans offer, businesses migrating from a legacy PBX in stages requiring coexistence, or those with complex call routing requirements. Operator Connect is simpler and faster to deploy — ideal for businesses without existing carrier contracts or complex telephony requirements.

What is a Session Border Controller (SBC)?

An SBC is a network device (physical, virtual, or cloud-hosted) that translates signalling between Microsoft Teams and a SIP trunk carrier. Microsoft certifies specific SBC models for Teams Direct Routing. For most Australian SMBs, a cloud-hosted SBC (such as AudioCodes Live or Ribbon Connect) is recommended — no on-premises hardware, managed by the provider, and hosted in Azure for low latency.

Which SIP trunk providers support Teams Direct Routing in Australia?

Compatible Australian SIP trunk providers include Telstra SIP Connect, Vonex, Symbio Networks, Vocus, and others. The SIP trunk must support G.711 codec, SRTP/TLS encryption (required by Microsoft), and Australian emergency calling requirements. Mycelium 365 works with the major Australian SIP trunk providers to configure and manage Direct Routing deployments.

Mycelium 365 implements both Direct Routing and Operator Connect — see our Microsoft Teams Voice service for implementation and pricing.