At present, Microsoft Teams is the most popular business collaboration tool. Teams now has more than 320 million monthly active users, and our own research shows that 70% of large organizations and 60% of all businesses use the platform.
But only 5% of those users have opted for Direct Routing.
Although Teams is used by a majority of businesses, only 39% of businesses use it as their “main” platform—which is still the top spot. We use too many collaboration tools, and that damages communication with disjointed notifications, access, and data storage.
Furthermore, with the future business environment combining a flexible remote and office working pattern, the importance of both a hybrid and unified communication strategy is critical to efficiency and saving costs.
This article is about helping you understand the power of Microsoft Teams Direct Routing, and explaining how it can help unify your entire collaboration system with Teams. Let’s get started.
What is Microsoft Teams Direct Routing?
Microsoft Teams Direct Routing is when Microsoft supports connecting session border controllers (SBCs) to Teams. This could either be your own SBC or a vendor’s environment.
The physical or virtual SBC connects telephony (on-premises or virtual) on one side to the cloud (Teams). There’s no certification for vendors or end customers to become ready-to-use for Teams. Only the physical equipment can be Teams-certified.
When you opt for Direct Routing, you get Teams access to unique functionality that an SBC enables. This includes traditional PBX features that you can’t (yet, at least) replicate on a Microsoft Calling Plan deployment.
So, if you need any/all of the following PBX features, Direct Routing is likely the best choice:
PBX interop
Least cost routing
Media bypass
SIP trunks
Analog devices
Fax
ISDN connectivity
Local site breakout
Survival branch appliance
Complex routing
Extension support
Disaster recovery
How does Microsoft Teams Direct Routing work?
Direct Routing securely connects Microsoft Teams to a telecom provider, allowing users to make and receive external phone calls from a Teams client on a computer or mobile device.
You can choose to manage this yourself on-site or subscribe to a Direct Routing as a Service (DRaaS) package, where a service provider looks after everything for you.
Here is a basic topology diagram of how Microsoft Teams Direct Routing works:
What are the benefits of Microsoft Teams Direct Routing?
The benefits of Microsoft Teams Direct Routing are:
Makes it possible to achieve feature parity with your previous phone system
Provides a consistent user experience as there’s no third-party calling app
Removes costs for hardware, software, and maintenance
Covers regions outside of Microsoft Calling Plan
Allows users to make calls directly from Teams
Enables integration with line of business apps
Lets you keep your existing phone numbers
Scales easily by adding and deleting users
Enables complex routing setups
With the wide number of business collaboration tools in use (even within a single organization), standard phone calls are a unifying communication tool.
Collaboration with external stakeholders still mostly takes place on the phone. Fundamentally, integrating this communication option into your business collaboration tool is the only way to deliver full-spectrum coverage across every necessary collaboration channel.
Teams Direct Routing costs and pricing
Teams Direct Routing pricing differs from provider to provider. Our own costs are as follows (accurate to February 2025):
$1.24 (circa 95 pence) per user per month – assumes you bring your own SIP carrier and have 5,000+ users
$2.83 (circa £2.15) per user per month inc unlimited minutes across all users – assumes you port your numbers and have 2,000+ users (applicable to UK and Ireland only; global pricing may vary)
With different Direct Routing providers, expect variation in the cost of Direct Routing due to different setups, implementation time, and professional services.
What is the SLA for Teams Direct Routing?
There is no set SLA for providers of Direct Routing. Each provider will have its own technologies in play so it will differ from provider to provider. For example, Direct Routing via Callroute comes with a 99.9% SLA.
For the sake of absolute clarity, that’s not to say it will only work 99.9% of the time. Rather, that’s the guarantee to you.
But there is an SLA associated with Teams Phone.
At Enterprise Connect in March 2024, Microsoft announced that, from April 1st, the Teams Phone Service Level Agreement (SLA) will be 99.999% uptime.
Here’s the exact wording:
Teams Phone service level agreement with 99.999% uptime On April 1, we will update the service level agreement for Teams Phone to 99.999% uptime, to show our commitment to provide reliable calling. The financially-backed service level agreement covers Microsoft Teams Calling Plans, Teams Phone, and PSTN Audio Conferencing. If a user’s ability to initiate a PSTN call, dial into an audio conference via the PSTN, or process calls with call queues or auto attendant fall below 99.999% in a given month, Microsoft calculates the total downtime and payout service credit based on length of incident (in minutes) multiplied by the number of users potentially impacted by the incident.
However, all is not quite as it seems. There was quite the online uproar when Microsoft announced its new SLA, with some doubting the validity of its claims.
In an article for NoJitter, Melissa Schwartz broke down exactly when 99.999% applies.
Subscription date limitations
If your subscription term began before April 1, 2024, your SLA will be whatever was in effect at that time.
The new Teams Phone 99.999% uptime SLA will not apply until you renew.
Azure Communication Gateway limitations
The Azure Communication Gateway is the supporting infrastructure for Operator Connect and Teams Phone Mobile.
Azure Communication Gateway services will only support 99.99% SLA (as of May 2024).
If your number was originally provisioned on the Azure Communication Gateway, the same 99.99% uptime will apply even if you move it.
Voice quality only comes with a 99.9% SLA
99.999% does not apply to voice calls, only the Teams Phone service (except Operator Connect and Teams Phone Mobile as above).
99.9% only applies when calls are made using Microsoft-certified IP phones.
99.9% only applies when calls are made using a wired ethernet connection (so calls over wireless connections, like home users, aren’t included in this SLA).
Packet loss, jitter and latency issues on the call were due to networks managed by Microsoft.
Microsoft Teams Direct Routing providers
There is no such thing as a “Teams Direct Routing provider”.
It’s important to understand that only the SBC is Microsoft Teams-certified. Therefore any provider with the right equipment could provide you with Direct Routing. Or you could look after the infrastructure yourself in-house.
Verified Direct Routing SBC providers include:
Microsoft
Audiocodes
Ribbon
Thinktel
Oracle
TE-SYSTEMS
Metaswitch
Cisco
Avaya
Nokia
Ericsson
Italtel
ULTATEL
Cataleya
Atos
Sansay Inc
Enghouse Networks
Patton Electronics Co
M5 Technologies
Ekinops
46 Labs LLC
Frafos
Is Direct Routing the only way?
Direct Routing is not the only way to make and receive calls within Microsoft Teams. There are two other options for making and receiving standard phone calls with Teams.
However, Direct Routing is by far the best option for placing a phone call with Teams.
Let’s explain:
Cross-launch apps
Several tools provide in-app cross-launch overlays that can be used with Teams, including RingCentral, Zoom, and Cisco Jabber.
All these provide the ability to place standard phone calls, and cross-launching them from Teams delivers an effective way to place that call quickly from the Teams interface.
But it’s not an integrated solution.
This means no centralized access and no data storage. It also means that incoming calls won’t ring the Teams client.
Most importantly, using an app means using yet another outside application to place a call, contributing to the ‘too many tools’ issue.
Once again, we’re talking disjointed workflows and complex costs and management.
Microsoft Phone System and Calling Plan
The other alternative to Direct Routing is connecting to the PSTN network through Microsoft’s in-house option.
Microsoft Calling Plan and Phone System deliver an integrated solution, but not a very sophisticated one. The problem with this option is that you do not get the same level of call control that a standard business phone system (using a PBX or SBC) can provide.
That means that although this option will let you place calls with Teams, it’s unlikely to let you migrate your entire business phone system to Teams. A lot of this comes down to the weakness of Phone System as a control tool. Calling Plan can also be an expensive choice.
What is the difference between Microsoft Calling Plan and Direct Routing?
The difference between Direct Routing and say Microsoft’s Calling Plan is that Direct Routing connects Microsoft’s Phone System to the PSTN via a telephony provider, rather than Microsoft.
This means introducing complete PBX capabilities to your Teams calling solution, and avoiding the shortcomings of Microsoft Phone System.
Microsoft Calling Plan
Direct Routing
Activate quickly
Requires planning and setup
Access in Teams Admin Center
Possible to integrative with line of business apps
Good for basic calling requirements
Good for complex requirements
Regular monthly billing
Covers regions outside of Microsoft Calling Plan
Per user billing
Achieve feature parity with previous phone system
Direct Routing also introduces a wider range of device compatibility and an overall greater degree of customization and control—including price flexibility.
Pro tip: Direct Routing can either be provided by a third party, or by the PSTN carrier.
For example, at Callroute, we provide both the PSTN service and integration capabilities. The latter option delivers faster integration and improved quality controls because back-end integrations can be pre-configured and the entire process is controlled by a single provider.
The bottom line: We should state upfront that Direct Routing has the potential to be the better solution, but not all Direct Routing solutions are the same.
In some cases, Calling Plan will be the better option. Check out these pros and cons of Microsoft Calling Plan:
Microsoft Calling Plan Pros
Microsoft Calling Plan Cons
Activate quickly
Limited changes
Access in Teams Admin Center
Restricted integration
Good for basic calling requirements
Restricted telephony features
Regular monthly billing
Expensive when scaling
Per user billing
Limited regions
What license is needed for Direct Routing?
You need a Microsoft Phone System license to enable Direct Routing.
Phone System is included in Microsoft 365 E5, but must be purchased as an add-on with others. You will also need to purchase Microsoft Teams Enterprise on top of any Office 365 F1, F3, E1, E3 and E5 license to allow users to use Teams.
However, with Direct Routing, this is simply a prerequisite license, rather than the central control tool that it becomes with Microsoft Calling plan.
For more information, check out the two blogs below:
When should you consider using Direct Routing rather than any other option?
Choose Direct Routing when:
1 – Long-term phone system contracts get in the way
If you have any existing PSTN provider tied up in a contract, Direct Routing allows you to use that phone system as your telephony provider.
2 – Industry-specific regulations restrict your options
Ideal for on-premises connections in industries like finance and healthcare, when legislation or compliance dictates the cloud shouldn’t be used to transmit data or phone calls, Direct Routing provides an option to keep telephony on-site while enabling Microsoft Teams.
3 – Important features aren’t available in Microsoft Teams
If you have specific PBX functionality that isn’t (yet) available via Teams, Direct Routing allows you to have the best of both worlds: keep your PBX functionality and use Teams for collaboration and meetings.
How Microsoft Teams Direct Routing changes collaboration
For the overwhelming majority of teams, Direct Routing is the smartest and most outcome-driven option. Unlike the alternatives, Direct Routing lets you go above and beyond merely placing calls with Teams.
It enables you to replace your entire business phone system with Teams by integrating a fully-capable phone system within Teams. This is what we mean when we talk about delivering real unified communications.
As you’ve probably worked out, unified communications is exactly what it sounds like—running all communication channels through a single platform.
With today’s employees spending 50% more of their time engaged in collaborative work, it’s essential to deploy tech tools that allow teams to work together seamlessly.
This is especially vital for businesses with a remote and distributed workforce. 50% of organizations have also reported the need for increased collaboration.
Why migrate from multiple tools to just one?
Using a single, unified communications platform for all of your business needs can help:
Boost productivity and efficiency
Promote better internal communication
Simplify collaboration with outside stakeholders
We already know that Microsoft Teams is the best choice for most businesses looking for an all-in-one platform.
Unifying your communication through Teams brings benefits like:
Ease of access
An all-in-one system means everyone has easy access to what they need, as everything related to your workforce is kept in the same virtual space. Unifying your communications with Direct Routing also means a single phone number, no matter where you are.
Centralization of records and information
For employees, this means less time wasted jumping between applications and trying to keep up with what’s happening on each one. When conversations, meetings, and shared files are available within a single shared user interface, productivity will naturally increase as a result of fewer mixups, missed messages, and ‘sorry, can you resend the file?’ requests. With Direct Routing and Teams, this even extends to external collaboration.
Federated presence
This refers to the ‘status’ symbols that indicate whether or not you are available. Ensuring that each team member’s status is present (and consistent) across every communication channel boosts internal communication and transparency. In simple terms, a federated presence means employees won’t be interrupted when they’re on an important call with a client or presenting in a meeting.
More efficient workflows
Ultimately, unifying your communications is about making your workflows more efficient. Microsoft Teams was designed to enable flexible working, with access to tools from whatever device your employees are working from. Teams also offers better communication options, with instant messaging, video, and voice. Using Teams as an ‘all-in-one’ suite enables your business to continue without interruption, no matter where in the world your team is working.
Shifting your communications to a single platform—Microsoft Teams— is an essential step to delivering the business outcomes you want in the new normal and beyond. For the majority of businesses, this means using Teams to its full potential by harnessing the unifying power of Direct Routing.
How to set up Microsoft Teams Direct Routing today
You need a Phone System license. If you have the E5 version of Microsoft 365, that license comes standard. Otherwise, you will need to buy it separately.
Note, you will also need to purchase Microsoft Teams Enterprise on top of any Office 365 F1, F3, E1, E3 and E5 license to allow users to use Teams.
The next step is to find a provider that can deliver a sophisticated Direct Routing solution capable of meeting your business requirements.
For this, you have two options:
Stand-alone Direct Routing: The traditional choice is a managed service provider able to integrate your existing PSTN carrier with Teams. This requires communication across multiple stakeholders, slowing down and complicating the process.
Integrated Direct Routing: The simpler option is to find a PSTN carrier able to deliver Direct Routing themselves.
At Callroute, we provide an integrated Direct Routing option.
What makes Direct Routing the better choice (most of the time)?
Every Direct Routing solution will be unique to the provider and integration.
A lot of Direct Routing solutions are let down by slow integration times—often up to seven days—and inflexible pricing with long-term contracts reminiscent of traditional telephony.
But neither of these problems is inherent to Direct Routing, and finding the right provider can remove them entirely.
Automated provisioning: automate your Microsoft Teams user settings and number assignment.
Self-service: easy-to-use self-service portal to enable quick administration.
There’s no question that unified communications is essential to the future of business. The best option for a streamlined strategy is Direct Routing, which gives you the advantage of sophisticated telephony directly from Teams.
With Callroute, you can harness the power of Direct Routing, unify your phone system, simplify workflows and future-proof your calling capabilities in a matter of minutes. We’re rated 5-star by our customers, and won the ‘Best Functionality & Features 2024’, and ‘Most Recommended 2024’.
Callroute is exhibiting at the European Collaboration Summit in May 2025. The event is one of the largest community-driven events focused on modern workplace collaboration,
Callroute is excited to announce the launch of its new advanced and award-winning call recording service powered by Oak Innovation’s ClarifyGo, now available directly within
Intermittent Microsoft Teams calling issues reported globally. This issue appears to be affecting all Microsoft customers worldwide. Microsoft are currently investigating the issue. All Callroute systems are fully operational. More information will be provided as soon as possible.
