Good question! Glad you asked!
You may be aware of SIP and its use in VoIP telephony. SIP is an acronym for Session Initiation Protocol which is the protocol used in VoIP calls for call session setup and tear down. SIP trunking is a protocol or method used to provide logical communication paths or call paths for VoIP calls between your PBX and your SIP trunk provider or carrier.
SIP trunking works over your data network, over the public internet or a private WAN connection between your site and your SIP trunk provider. Essentially, in simple terms, you can take an existing data connection and use an IP connection to connect your PBX to your SIP trunk provider. It would be somewhat the equivalent of using an PRI connection to connect your PBX to your PSTN provider. Your SIP trunk provider has a data network with interconnections into the PSTN. Your SIP trunk provider servers are a gateway to the PSTN.
Folks from who have setup older PBXs with PRIs know that when setting up a PRI you identify your switch type, encoding method and other parameters so that your PBX and the carrier switch are speaking the same language. Similarly, SIP trunking may require similar tweaks. The basic setup usually involves inputting parameters in your PBX such as the SIP trunks end point IP along with a username and password. In some cases, additional configuration is required.
There are significant advantages to using SIP trunks. For example, SIP trunks are a great way to save money and become more agile! But, that’s another subject for another day!