Direct Routing or O365 Phone System

Hi,

You will need Phone System for both Direct Routing and Calling Plans. Phone System is the PBX in Teams and the license that allows your users to call. Direct Routing and Calling Plans is the connection to the PSTN network. 

You can get Direct Routing in two flavours, self-hosted or telco-hosted. With the self-hosted you need to manage equipment yourself since you need a SBC, but you don't need to have something on-premises, you could host the SBC in Azure (or some other cloud service). With Direct Routing SBC hosted at an Telco they will take care of this for you, so you don't need to install anything yourself. 

If you have analogue devices that you need to connect to Teams you currently need a SBC connected with Direct Routing, if you can't get rid of those devices.

With Calling Plans from Microsoft you get a number from Microsoft and you don't need to bother about anything else, they will be your operator. Easy, but it could also be a bit pricy for some organisations (but you don't have to manage any equipment, so there you save some bucks). Calling Plans is not available in all countries, so that might be a problem for you.

If you have users in many countries and combination of Direct Routing and Calling Plans can be an option for you too.