Microsoft Teams Direct Routing vs Operator Connect Guide

Microsoft Teams already handles chat, video calls, and file sharing for over 320 million daily active users. But making and receiving external phone calls through Teams requires a separate voice connection to the Public Switched Telephone Network (PSTN). That is where the choice between Direct Routing, Operator Connect, and Microsoft Calling Plans comes in.

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This guide breaks down what each option involves, what hardware and licenses you need, and how to decide which path works for your organization. If you are an IT leader evaluating Teams as a full phone system replacement, this comparison will save you hours of research.

What Is Microsoft Teams Direct Routing?

Microsoft Teams Direct Routing is a method of connecting Teams to the PSTN through a third-party carrier using a Session Border Controller (SBC). The SBC sits between your carrier’s voice network and Microsoft 365, translating SIP signaling so Teams users can make and receive external calls.

Direct Routing gives organizations control over carrier selection, call routing rules, and voice infrastructure. Businesses that run complex multi-site phone systems, need to keep existing carrier contracts, or require advanced PBX features often choose this option. According to Microsoft’s documentation, Direct Routing supports nearly any telephony carrier worldwide, as long as the SBC is certified for Teams.

The trade-off is complexity. Your IT team (or a managed service partner) handles SBC deployment, certificate management, SIP trunk configuration, and ongoing maintenance. For organizations with in-house telecom expertise, that control is a benefit. For teams without those skills, it can become a burden.

How Does Direct Routing Compare to Operator Connect and Calling Plans?

Microsoft offers three main paths to PSTN calling in Teams. Each one handles the same core job, connecting Teams to external phone lines, but they differ in how much infrastructure you manage, which carriers you can use, and how much flexibility you get.

Bottom line: Direct Routing gives you the most control but demands the most work. Calling Plans are the simplest but the least flexible. Operator Connect hits a middle ground, offering carrier-grade reliability and global coverage with minimal IT effort.

See how BluIP Operator Connect simplifies Teams voice with carrier-grade reliability.

What Do You Need for a Teams Direct Routing Setup?

If you decide Direct Routing is the right fit, here is what you will need before configuration begins:

1. Microsoft 365 licenses with Teams Phone: Every user making external calls needs a Teams Phone license (previously called Phone System). This is included in Microsoft 365 E5 or available as an add-on for E1 and E3 plans.
2. A certified Session Border Controller: Microsoft maintains a list of certified SBCs from vendors like AudioCodes, Ribbon Communications, and Oracle. The SBC can be physical hardware in your data center or a virtual appliance in Azure or AWS.
3. SIP trunking from a carrier: You need a carrier that provides SIP trunk connectivity. This is where your phone numbers and PSTN minutes come from. You can keep your existing carrier or choose a new one.
4. Public IP address and SSL certificate: The SBC needs a public-facing IP and a TLS certificate from a trusted certificate authority. Microsoft’s documentation specifies which CAs are accepted.
5. DNS records: Your SBC’s fully qualified domain name (FQDN) must resolve to the public IP. You will also need to configure media bypass settings if you want to reduce latency.
6. Firewall rules: Ports 5061 (SIP signaling over TLS) and a range of UDP ports (typically 49152-53247) for media traffic must be open between the SBC and Microsoft 365 endpoints.

The setup process typically takes two to four weeks, depending on your existing infrastructure and how many locations you are connecting. Organizations with multiple sites or complex routing requirements should expect a longer timeline.

When Direct Routing Makes Sense for Your Business

Direct Routing is not for everyone, but it is the strongest choice in specific situations:

• You have existing carrier contracts: If you are locked into multi-year agreements with a telecom provider, Direct Routing lets you keep those contracts and add Teams calling on top.
• You need advanced call routing: Organizations with complex IVR menus, call queuing rules, or least-cost routing across multiple carriers benefit from the SBC’s policy engine.
• You run a hybrid phone system: If some locations still use traditional PBX hardware and you are migrating to Teams in phases, Direct Routing supports that hybrid architecture.
• You operate in regions Operator Connect does not cover: While Operator Connect’s carrier network is growing, some countries and regions still lack verified operators. Direct Routing works with any carrier anywhere.
• Compliance requires on-premises call recording: Certain industries (finance, healthcare, government) need call recording infrastructure they control. An SBC can route calls through on-premises recording systems before they reach Teams.

If none of these apply to your business, Direct Routing may add complexity without a clear payoff. That is where Operator Connect becomes a better fit.

Why Many Businesses Choose Operator Connect Instead

Operator Connect removes the SBC from the equation entirely. Instead, a Microsoft-verified telecom operator (like BluIP) establishes a direct peering connection between its network and Microsoft’s cloud. You activate the service from the Teams Admin Center in minutes, not weeks.

Here is what that looks like in practice:

1. Select your operator: Open the Teams Admin Center, go to Voice > Operators, and choose BluIP (or another verified provider).
2. Provision phone numbers: Your operator assigns numbers directly through the Teams interface. No separate portal, no SBC configuration.
3. Start calling: Users with Teams Phone licenses can make and receive external calls immediately.

BluIP is a Tier 1 global service provider and certified Microsoft Operator Connect partner. That means BluIP owns and operates its telecom infrastructure directly, rather than reselling another carrier’s network. For Teams voice, this translates to geo-redundant connectivity, carrier-grade reliability, and 24/7 support from engineers who manage the actual network, not just a help desk layer.

BluIP also offers a 30-day free trial for Teams Calling, so you can test the voice quality and management experience before committing. Dynamic E911 compliance (including RAY BAUM’s Act and Kari’s Law) is built in, which matters for organizations with distributed offices.

Request a demo to see how BluIP connects Teams to the PSTN without the SBC overhead.

How to Set Up Microsoft Teams for External Calling

Regardless of which PSTN option you choose, the general process follows these steps:

1. Confirm your licensing: Verify that users have Teams Phone licenses assigned in the Microsoft 365 admin center. Check your current plan: E5 includes it, E1 and E3 need the add-on.
2. Choose your PSTN method: Based on the comparison above, pick Direct Routing, Operator Connect, or Calling Plans. Most mid-size and enterprise organizations choose Operator Connect or Direct Routing for better carrier flexibility.
3. Set up voice routing: For Direct Routing, this means configuring the SBC, creating voice routing policies, and assigning PSTN usage records. For Operator Connect, the operator handles routing; you just assign numbers to users.
4. Port or provision phone numbers: Transfer existing numbers from your old phone system or get new ones. Number porting typically takes 7 to 14 business days. BluIP’s SIP trunking services can help bridge the gap during migration.
5. Configure emergency calling: Set up emergency addresses for every user and location. This is a legal requirement in the US, not an optional step. Your carrier or operator should provide dynamic E911 support.
6. Test and roll out: Start with a pilot group. Verify call quality, check number display, test transfers and voicemail. Then expand to the full organization.

For organizations using BluIP’s cloud PBX platform, the Teams integration works alongside other communication tools. That means you can run Teams voice for office staff while using BluIP’s AIVA Connect platform for AI-powered customer interactions at the same time.

Direct Routing vs Operator Connect: Cost Considerations

The total cost of Teams voice goes beyond the per-user license fee. Here is what to account for with each option:

Direct Routing costs include:

• Teams Phone license ($8/user/month with E1 or E3, included in E5)
• SBC hardware or virtual appliance ($2,000 to $15,000+ depending on capacity)
• SBC maintenance and software updates (annual support contracts)
• SIP trunk service from your carrier (per-channel or per-minute pricing)
• SSL certificates (annual renewal)
• IT staff time for deployment and ongoing management

Operator Connect costs include:

• Teams Phone license ($8/user/month with E1 or E3, included in E5)
• Operator service fee (varies by provider; typically per-user/month)
• No SBC costs, no certificate management, no dedicated IT overhead

For organizations with fewer than 500 users and no legacy PBX requirements, Operator Connect almost always costs less when you factor in the hidden expenses of SBC ownership. For larger enterprises with existing telecom teams and complex routing, Direct Routing’s upfront investment can pay off through carrier negotiation flexibility.

Frequently Asked Questions

What is the difference between Teams Direct Routing and Operator Connect?

Direct Routing connects Teams to the PSTN through an SBC that your organization manages. Operator Connect uses a Microsoft-verified carrier to provide PSTN connectivity directly through the Teams Admin Center. Direct Routing gives more control over call routing and carrier selection. Operator Connect is faster to deploy and requires no on-premises equipment.

What license is needed for Microsoft Teams Direct Routing?

You need a Teams Phone license for every user who makes external calls. This is included in Microsoft 365 E5 plans. For E1 or E3 plans, you can add it as a standalone license at about $8 per user per month. You also need a valid Microsoft 365 subscription with Teams.

Can I switch from Direct Routing to Operator Connect?

Yes. Many organizations start with Direct Routing and migrate to Operator Connect once a verified operator is available in their region. The migration involves removing the SBC configuration, selecting an operator in the Teams Admin Center, and re-assigning phone numbers. Carriers like BluIP offer guided migration support to handle the transition.

How long does it take to set up Teams Direct Routing?

A typical Direct Routing deployment takes two to four weeks. This includes SBC procurement and configuration, SIP trunk setup, certificate installation, DNS configuration, and testing. Operator Connect deployments can be completed in one to three business days because the carrier manages the infrastructure.

Is Direct Routing being discontinued by Microsoft?

No. Microsoft continues to support and update Direct Routing. However, Microsoft has been investing heavily in Operator Connect and Teams Phone Mobile as newer alternatives. Direct Routing remains the best option for organizations that need SBC-level control or operate in regions without Operator Connect coverage.