Home » Microsoft Teams » Direct Routing in Microsoft Teams Could Spark the End to Cloud Voice

Direct Routing in Microsoft Teams Could Spark the End to Cloud Voice

Up until now if you wanted cloud voice provided within your Office 365 tenant you had a choice, calling plans and consume Microsoft’s Cloud Phone System, use Cloud Connector Edition to connect your on-premises PSTN investments to the cloud, or hybrid voice if you had an existing Skype for Business Server implementation.

When investigating which one of these three scenarios to implement, you’ll quickly realise that neither option is that silver bullet that is going to see the return on investment you hoped for by consuming cloud.

Microsoft’s cloud only solution is really quite expensive when you start to scale that out to all your estate. It also has holes in coverage, being that it is only available in 9 countries worldwide. For me, the calling plans offered by Microsoft are not good value for money.  They are not flexible in that you pay for an amount of minutes per user, whereas traditional PSTN providers charge an amount of minutes per site / contract typically.  For instance, your business may consume 30,000 minutes per month over 50 consumer users. This works out at 600 minutes per user. To accommodate the users and consumption requirements in Microsoft, you would need 50 calling plans, 1 per user. Each calling plan in the UK gives you 1200 minutes per month, so that’s double the capacity of what you need i.e. 60,000 minutes worth of available usage. So you are paying for 50% capacity that you will never use. Now the cost, Microsoft calling plan vs telco contract may mean the actual monetary cost is less than 50%, but in all likelihood, your on-prem telco solution is more competitive. The question then turns to other organization benefits by moving to cloud only, if they can offset the investment or not.

The feedback I have received from customers is the perception of calling plans is prohibitive to be a complete replacement of on-prem telephony solutions. Therefore, they look for hybrid solutions.

Cloud Connector Edition is free and inclusive to the Phone System license. This allows that hybrid connectivity between your PSTN and the Microsoft Phone System so that existing investments can be realized by the business. The idea of this was sound, the execution, not so. CCE required dedicated hardware, it could not be collocated on existing hardware investments. Furthermore, it was hyper-v only, which for vmware only businesses posed a supportability challenge. If that wasn’t enough, it required Windows Server 2012 R2 Datacenter edition due to the number of VMs required, bringing the cost of a CCE solution from free to somewhere in the region of $20,000 or more.  When considering HA for CCE, this doubled the cost of the solution for each site. An org with 5 sites, that’s near $100k outlay for a solution that the business does not own in perpetual terms.

From the feedback I received, this solution was not really viable for companies, within the UK at least. The reasons given where cost, but more intriguingly, lack of confidence in Microsoft. When explored further, the agile approach that Microsoft is taking towards the cloud and changing products (SfB to Teams for instance) made customers nervous. They didn’t want to invest 100k into a solution the vendor themselves do not believe in because they’ve brought in a completely new UC solution in that of Teams. Customers, just felt CCE was clumsy and had a short shelf life. And they have been proved right in a way, even though CCE and SfBO remain potential solutions today with no sign of end dates as yet.

And then we have businesses who have some on-prem SfB infrastructure. Do they configure hybrid voice knowing that the long term strategy of Microsoft is Teams and not SfBO? At the moment there is no hybrid SfB Server and Teams coexistence story, the islands approach is messy in organizations where the demographic is split between on-prem and cloud SfB. Businesses are looking for a good story and experience with full support for interoperability whether that is for transition, or end state. But in order to consume on-premises PSTN connectivity with Teams when an org already has SfB enterprise voice is no small task. Firstly it is not supported, second the alternative in Direct Routing is possible, but there are some significant reconfiguration challenges at the SBC level which will take a lot of time and effort to implement. And time = money.

As you can see, there are challenges with each of the current solutions above. Now add in the network variables, in cloud only voice, we are relying on internet connections to deliver enterprise grade call quality. We know that is not going to happen consistently and there will be regular challenges to overcome. The alternative is Express Route, which carries some considerable cost plus the complexity of deploying it into your network. CCE mitigated this with media bypass support as well as SfB server hybrid. But for all cloud users, the internet connection is on the critical path and will forever be a problem to some degree or another.

The other quite significant problem with cloud only voice is reliability. There have been some quite significant outages with voice services in Microsoft over the last 2 years and companies tend to have long memories. These outages stick inside people’s mind. We all have outages, but when your entire business is invested into a single solution and that is not available, it becomes a problem. Where voice is concerned, this is a very big problem compared to an outage to a SharePoint site for instance. So the trust that the service is fit for purpose is probably not where it needs to be for cloud voice to really take off.

These are the challenges Microsoft face as I see it. I don’t envy them, but I do respect them for giving this one serious go. And all in, the voice offering today coupled with the collaboration functionality is market leading, there is no one out there with this level of integration between communication, collaboration and productivity. It is an enterprise class solution.

But, and here is the rub. Cloud voice is simply dead.

Strong statement I know. But let me explain. It is acknowledged that calling plans aka cloud voice is expensive. But hybrid solutions done right are more compelling and cheaper (most of the time). You want people to use your cloud? Allow them to hook up what they have now and use it in your cloud. Simple.

CCE was the attempt, Skype for Business Server probably doesn’t have the place in the hybrid cloud world that it once had, and if you’re looking for a integrated communication and collaboration tool, then Microsoft Teams is your only real solution today. Sure, there are others, but when you drill down and assess your goals, you’ll realise in most cases the competitor products are no more than PoC or small scale projects that never really take off in the direction you thought.

Direct Routing is a game changer for Microsoft Teams and hybrid voice. It is the cloud voice killer in my opinion. The future is hybrid voice. Quite simply I cannot see it being any other way.

Direct Routing allows you to connect to Microsoft Cloud using nothing more than a SIP trunk and an SBC. CCE and SfB Server no longer play any role in the hybrid voice journey for Microsoft Teams. And this is a good thing, because it opens up all kinds of opportunities.

The benefits of Direct Routing are huge:

  • I can leverage my existing investments in PSTN connectivity and see out my contracts
  • I can use it to negotiate better contracts vs calling plans or vs existing contracts
  • I can integrate to legacy PBX worlds and other voice technologies I may have on-prem with ease
  • I can use it as a way to consolidate existing PSTN connections to better increase my savings
  • I can move a user’s number between PBX and Teams or vice versa without significant disruption to the user, or admin overhead (porting numbers etc.)
  • I can preserve dialling habits of the users so they don’t have to learn new ways of dialling the same destination
  • I can arrange PSTN coverage in countries that Microsoft do not have PSTN presence in
  • I can enable a site with minimal investment and at speed
  • I can configure inter-site HA and DR
  • I can configure least cost routing
  • I can connect to perimeter devices, fax, analog etc.
  • I can maintain good voice quality because the majority of my media stays local to my LAN and I can implement QoS end to end
  • I don’t need express route
  • I can consume Direct Routing as a Service
  • I can guarantee service availability

Perhaps the most intriguing possibility is Direct Routing as a Service (DRaaS) and this really carries several nails in the cloud voice coffin. As a business my objectives are: maintain service availability, provide adequate tools for the business to function and achieve these with the minimum investment.

Why take on the responsibility between PSTN and cloud by owning your SBC and Direct Routing trunk when someone else can do this for you?

Wouldn’t it be great if your carrier can say to you, don’t worry we can provide all you need to connect to Microsoft Teams under your contract with us?

That to me is the most exciting part of the Microsoft Teams hybrid journey, the ability to be so flexible in how to use Direct Routing to suit the business needs and financial constraints is one of the best reasons to consider Microsoft Teams as your default communication platform of the future.

Personally, with Direct Routing being available, I wouldn’t consider Microsoft Cloud Voice with calling plans as a long term solution to my business at least. I think it has its place, rapid enablement if you have an acquisition, a temporary solution until something permanent comes in like Direct Routing.

But you’re about to comment on this article and say Mark, you’ve forgotten that the world is now an agile place. I haven’t forgotten.

Everything up to now has been written in the context of an organisation with a lot of investment in site infrastructure and the majority of employees work from one or more of their sites. For these organisations, Direct Routing is a no brainer, and the default approach that should be considered in most cases.

For startups and organisations transitioning to an agile working strategy, encouraging working from home, or from a shared co-worker office space who have very little in the way of on-premises staff, then cloud voice delivered 100% by Microsoft should be the solution for them. The perceived cost of the calling plans is therefore offset by the reduction in overheads of property, utilities, equipment such as desks, chairs, lockers etc. employee services e.g. canteen, cleaners, maintenance and reduction in ICT support structures. For these organisations, cloud voice albeit on a apples vs apples comparison is more expensive generally than using on-prem, comparing the investment vs having to implement all that infrastructure to support on-prem working, the organisation is still saving a shed ton of cash by investing in Cloud voice.

So perhaps I revisit my blog title and say for organisations that are inherently site based, Direct Routing is a no brainer and a potential cloud voice killer.

For organisations that work in an agile manner, i.e their workforce is predominately remote to the office, then cloud voice is the solution for them and Direct Routing is not a consideration in many cases.




  1. Fantastic write up Mark, and echos my thoughts exactly when considering calling plans, CCE and/or direct routing as possible ways to light up PSTN connectivity for cloud users.

  2. Hi Mark

    Excellent article and I agree 100%. I think Microsoft had a very ambitious objective of rolling our voice worldwide but under Satya Nadella I think they have taken a more pragmatic approach. I have been asking for this solution, for all the reasons you highlighted, for 8 years already. I believe MS were a little myopic strategically in the early days. Glad they finally see the light, hope it is not too late.

  3. Hi Mark, very good article (as always!). In Italy we do not have the “Calling Plan” option for our customers, but I agree with you, even if we had that option it is quite impossible to sell, costs are higher by some orders of magnitude compared to standard SIP Trunk offers. No CCE ’till now, too expensive. Tons and tons of On-Prem, and I think we’ll deploy more and more in the future. Teams DR is a GREAT product and it will be easy for us to deploy (side-by-side with SfB also), the problem is in the Teams client, too heavy for many PC and too distant from the basic phone users. I said in the past and confirm: MS is underestimating the impact of the client change from the end user perspective.
    We will stay and see….

  4. Hello Mark,

    Thanks for this article.
    I’m working on a project that involve to move traditional PBX to Office 365 Cloud PBX by the end of this year. We want to keep our own PSTN carier and avoid Skype for Business On-premises deployment.
    Teams DR seems the perfect solution for that, however, we need some features that are not available yet like AutoAttendant/Call queue, Room System..

    Do you think it’s a good idea to start with Skype CCE instance with SBC and then move to Teams DR with SBC later ? (and remove all CCE deployments)

    • Hello

      Teams DR should be what you deploy. Today Teams can use Organizational Auto Attendant and Call Queues this is Generally Available. This doesn’t require any on-prem investment, even Teams DR as it is a cloud only solution. If you need to retain numbers, then you would port the numbers across to microsoft and convert them to service numbers, and then assign to an OrgAA or Call Queue respectively. From an enterprise voice perspective, SfBO and CCE do not bring you any capability you cannot reproduce in Teams.

      • Are you sure about AA and Call queue ? I did not see any news about it and it’s still mark as not ready yet in Lucas Vitaly comparison table.
        What do you mean by “retain numbers” ? I was thinking to port them to the SIP carrier directly but maybe I miss something.

      • Hi

        Yep I have AA and Call queues set up for my business coming through to Teams.

        By retaining numbers I mean the user keeps their own number whether that is porting or using direct routing.

        Hope this helps


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