SIP trunking refers to a service offered by telephony carries (traditional local exchange carriers or ITSPs) to terminate VoIP calls to the PSTN. Such services eliminate the need for a physical trunk line (analogue or ISDN) as the customers voice calls are sent to the PSTN using a standard IP connection. This eliminates the need for a PSTN gateway function at the customer premises.
In some markets, SIP trunks offer a more competitive solution. Benefits might include
more competitive pricing
greater flexibility as users usually can subscribe line-by-line, as opposed to the granularity imposed by ISDN (increments of 2 for BRI or 30 for PRI)
changes in the subscription often can be done without re-wiring
The downside though is an often less mature solution. Users should carefully evaluate the presence of all required/desired features (e.g. emergency calls, DDI, supplementary features such as CCBS/CCNR).