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Technology Explanation By Alex Morgan · March 2026 · 8 min read

What is Microsoft Teams Direct Routing? Everything Your Business Needs to Know

Microsoft Teams Direct Routing lets you make and receive real phone calls inside Teams — without paying Microsoft for a Calling Plan. Here's exactly how it works.

💬 What is Direct Routing?

Microsoft Teams is a collaboration platform — messaging, video, file sharing. By default, calling within Teams only works between Teams users. To call external phone numbers (customers, suppliers, anyone on a normal phone), you need to add phone system capabilities. There are two ways to do this:

OptionWhat It IsCost/User/MoFlexibility
Microsoft Calling PlanMicrosoft provides UK phone lines directly£8–£12 extraLow — fixed Microsoft pricing
Direct RoutingUse a third-party SIP provider (like Telexico)£5–£15 extraHigh — competitive pricing, UK numbers

Direct Routing is almost always cheaper, and often gives you better UK number options and more control over call routing.

⚙️ How Direct Routing Works

In simple terms: Telexico provides a SIP connection between Microsoft's servers and the public telephone network. When someone in your business calls an external number from Teams, the call travels from Teams to Telexico's Session Border Controller (SBC), then out to the phone network. Incoming calls reverse this path.

You don't see any of this. From the user's perspective, they just make and receive calls directly in Teams on their PC, Mac or phone.

📋 What You Need to Set It Up

  • Microsoft 365 Business Voice or Teams Phone licence (£8–£12/user/month from Microsoft)
  • A Direct Routing provider like Telexico — we provide the SBC and connection to the PSTN
  • UK phone numbers (ported from your current provider or new numbers assigned)
  • A configured Teams tenant — Telexico handles this as part of setup

🤔 Direct Routing vs Hosted VoIP — Which is Right for You?

ScenarioBetter OptionWhy
Team already uses Teams heavilyDirect RoutingKeeps everything in one app
Need deskphones in the officeHosted VoIPPhysical phones not well-supported in Teams
Complex call routing / IVRHosted VoIPMore feature-rich call handling
Remote-first team, 365 already paidDirect RoutingNo extra software cost
Regulated industry (FCA)Hosted VoIP or Direct RoutingBoth can provide compliant call recording

💡 You can have both

Many businesses use Direct Routing for office staff on Teams and hosted VoIP for reception desks with physical handsets. Telexico can manage both from one account.

Telexico sets up MS Teams Direct Routing for UK businesses — including number porting and Teams tenant configuration.

Set Up Teams Calling →