What’s the difference between SIP, VoIP and cloud telephony?

VoIP stands for Voice over IP. In other words, making phone calls over the internet. Instead of using traditional phone lines, you use a data connection (like Wi-Fi or Ethernet) to handle calls.

The benefits of VoIP are clear: it’s cheaper, more scalable, and more flexible than legacy telephony. It also enables modern features like call forwarding, voicemail-to-email, call recording and video calling. Almost all modern phone systems, from desk phones to mobile apps, now rely on VoIP.

Important to know: VoIP is the technology, not the service itself.

SIP stands for Session Initiation Protocol. It’s a communications protocol that allows VoIP calls to be set up, managed and ended.

Think of it like this: VoIP is the concept of internet-based calling, while SIP is the language that devices use to make those calls happen. SIP handles call setup, routing, call quality, and features like transfers or conference calls.

You may have heard the term “SIP trunk”, this is a virtual connection between your phone system and a telecom provider using the SIP protocol. It’s the modern replacement for the traditional ISDN line.

In short: SIP is a protocol that enables VoIP.

Cloud telephony (also called hosted telephony) means you no longer need a physical phone system on-site. Instead, everything runs in the cloud, from routing and voicemail to integrations and updates.

You’re still using VoIP (and often SIP), but you don’t manage the infrastructure. The entire platform is delivered as a service by a provider. You just connect via an app, a desk phone or a softphone, and typically pay per user per month.

The main advantage is simplicity: cloud telephony is easy to scale, enables hybrid work, and updates are handled automatically.

Cloud telephony = telephony as a service, delivered online.

To clarify their relationship:

• VoIP is the concept of making calls over the internet

• SIP is the technical protocol that often powers VoIP

• Cloud telephony is a service model that uses VoIP (and often SIP) without you managing the system

They’re related, but not the same and understanding the difference helps avoid confusion when talking to vendors or making infrastructure decisions.

If you’re evaluating new telephony options (like switching to cloud, integrating with Teams, or upgrading legacy systems) it helps to understand what’s under the hood. It allows you to make better decisions about flexibility, costs, and long-term scalability.

Want to know how these technologies fit into your current setup?
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