How to Set Up Microsoft Teams Phone System
- Sam Williams
- Mar 29
- 2 min read
If you're still running a traditional phone system (PBX) or paying for a separate VoIP service, you can replace it with Microsoft Teams. Your team makes and receives calls using the same app they already use for chat and meetings.
It's not a five-minute job, but it's not as complicated as it sounds either.
What you need
A Microsoft 365 plan that includes Teams (most do).
Teams Phone licences — this is an add-on to your existing M365 plan. It's included in E5 but needs to be added separately for Business or E3 plans.
A way to connect to the phone network. Two options: Microsoft Calling Plans (Microsoft provides the phone numbers) or Direct Routing (you connect through your own SIP trunk provider, like Telstra or a VoIP provider).
Microsoft Calling Plans vs Direct Routing
Calling Plans are simpler. Microsoft gives you phone numbers and you pay per user per month. Good for businesses under 50 users who want minimal setup.
Direct Routing is more flexible. You bring your own phone numbers through a SIP provider. You can keep your existing numbers, get better rates for Australian calling, and have more control over call routing. Most Australian businesses go this route.
There's also Operator Connect — a middle ground where a certified telco provider handles the connection. Check if your current provider supports it.
Setting up auto-attendants and call queues
An auto-attendant is your 'Press 1 for Sales, Press 2 for Support' menu. Go to the Teams admin center → Voice → Auto attendants → Add.
A call queue distributes incoming calls to a group of people. Useful for support lines. Teams admin center → Voice → Call queues → Add.
Keep it simple. Nobody wants to navigate five levels of menus. One auto-attendant with two or three options, routing to call queues or individual extensions, is enough for most small businesses.
Porting your existing numbers
If you want to keep your current business phone numbers, you'll need to port them. This takes 2 to 4 weeks in Australia depending on the provider.
Start the port process early and plan a cutover date. During the port, there's usually no downtime — the numbers switch over and start ringing in Teams.
What to expect
Call quality depends on your internet connection. Teams calling works well on NBN and fibre. On ADSL or congested connections, you might get dropouts.
Your team will need headsets. The built-in laptop microphone and speakers aren't good enough for regular phone calls. Budget for a decent headset per person.
The transition takes some adjustment. People who are used to a desk phone with physical buttons need a week or two to get comfortable with the Teams calling interface.
We've helped businesses move from traditional phone systems to Teams Voice. We handle the licensing, number porting, auto-attendant setup, and training. Get in touch if you're thinking about making the switch.
