Microsoft Teams: Calling Plan vs Direct Routing?

Microsoft Teams is a chat-based internal communications and collaboration platform, complete with file sharing, online meetings and useful features for businesses. Microsoft developed a way to convert Teams into a business phone system by adding voice and PBX capabilities. There are two ways to do this: Microsoft Calling Plans and Direct Routing. But which is best?

Understanding The Differences In Making Teams Calls

First, let’s explain how calling in Microsoft Teams works. Teams supports the ability to make VoIP calls to other Teams users, to and from landlines and mobiles on the PSTN. What you need to start making phone calls and using call functionalities is PSTN connectivity, a phone number and phone system license.

To enable users to make and receive inbound and outbound phone calls, you have two options. The first is Microsoft Calling Plans where Microsoft provides a phone number to users and PSTN services. The second is Direct Routing where you connect your existing PSTN connectivity to Teams via a Session Border Controller and SIP Trunks.

What are Microsoft Calling Plans?

Microsoft Calling Plans are offered by Microsoft on a per-user license. Calling Plans include phone numbers, a bundle of minutes and PSTN services. These plans are maintained by Microsoft via Office 365 with no additional PSTN carriers and they turn Teams into a ‘light-touch’ hosted PBX.

Microsoft offers Domestic and International Calling Plans. A Domestic Calling Plan is where licensed users call out to numbers located in a country or region where they’re assigned in Microsoft or Office 365. An International Calling Plan covers the same thing as the domestic plan but can also call out to international numbers and countries. Whichever plan you choose covers a certain number of minutes.

Pros & Cons of Calling Plans

Managed by Microsoft

Calling Plans are managed by Microsoft, which can be both positive and negative. Microsoft is the provider of Teams with Calling Plans and since it’s within Office 365, there’s a top-level of security, services and support. However, many organisations prefer to choose their own third-party carrier instead of Microsoft due to other providers’ flexibility and costs.

Sold per plan and per country

Microsoft Calling Plans are sold per plan and per country. Microsoft offers these plans in 10 countries but hasn’t added a country since 2018. This is restrictive for many businesses who aren’t included in the country list.


In addition to Calling Plans only being available in select countries, they can be quite expensive and restrictive. For example, the Domestic Calling Plan starts at $12 per user per month and the International Calling Plan is $24 per user per month. The second and more popular option is Direct Routing.

Calling Plans

What is Direct Routing?

Direct Routing routes Teams to the PSTN using an SBC and SIP Trunks. It allows you to connect Teams to a range of telephony providers. Direct Routing is designed to convert Teams into a business PBX, which makes your business telephony stronger, easier and unifies your communications. Direct Routing is an attractive option to many businesses due to its flexibility and costs.

Pros & Cons of Direct Routing


Direct Routing is a very flexible and supportive service. With Direct Routing, you can choose your own telephony provider while retaining a verified integration with the Teams platform. You can choose a range of providers which give you different levels of support, costs and features in addition to the Teams software. If you’ve already entered in a contract with a provider, you can move to Teams and stay in your existing contract, enabling you to mix and match your chosen applications.


Direct Routing is a more cost-effective option than Calling Plans. It allows you to take advantage of cheaper call rates and per user licenses. With Gradwell, we help you source everything you need to get started with Direct Routing, including licenses, SBCs and SIP Trunks.

Number porting

Number porting with Calling Plans can be difficult, confusing and more time-consuming than it’s worth. On the other hand, telecom providers are more experienced with number porting and provisioning. It’s a simple process that your third-party carrier takes care of for you when you choose them to look after your Direct Routing process. This makes the transition to Direct Routing quicker and easier.

PBX features

By converting Teams into your PBX via Direct Routing, you can take advantage of voice calls and traditional call features. When you add voice and calling functionalities to Teams, you unlock an extensive variety of PBX features. These features include call transfer, holding, queues, routing, auto-attendant, simultaneous ringing, speed dial, voicemail, Microsoft Meeting Rooms and more.

Available globally

In comparison to Calling Plans – which are restricted to a certain number of countries – all countries are covered by Direct Routing.

Get started with Direct Routing

Turn Teams into your business PBX quickly, cost-effectively and with additional calling features.

Get started now

More articles

Interpreting BT’s latest PSTN switch-off announcement

Interpreting BT’s latest PSTN switch-off announcement

In November 2017, BT announced their intention to retire analogue telephone networks such as the Public Switched Telephone Network (PSTN) by the end of 2025. On 20th May 2024, they released details of a “refined digital switchover programme,” causing confusion for the...

Wave earns ‘PC Pro Recommendation’ for third year running

Wave earns ‘PC Pro Recommendation’ for third year running

We are delighted to announce that our very own, cloud-based phone system, Wave has earned PC Pro Recommended status for the third consecutive year. As part of PC Pro Magazine issue 357, which included a report marking the best business VoIP phone systems, Wave stands...