What is a PBX Phone System?

Simply put a PBX is a device that phone calls are terminated to. The PBX then handles how this call is handed out to connected handsets. To achieve this the PBX has three primary roles.

  • Keep an active connection to a carrier – Whether this is achieved by a traditional telephone line or a SIP Line
  • Keep in constant communication with connected handsets
  • Call Flow Management – Features such as voicemail, hunt groups, auto attendant etc

A PBX is the acronym of Private Branch Exchange which is a phone network that a company uses to communicate both internally (within the enterprise) and externally (with the outside world). Unlike the PSTN (public switched telephone network ), PBX helps to save on cost as it allows free calls between users without the need of each user having a line to the central office of the company’s telephone.

A PBX can be either a private telephone network or a telephone system for a business. While many may assume that the telephone company operates PBX, that’s not the case. The enterprise owns and operates it. In this case, the telephone service company only acts as the service provider or supplier. The PBX systems have evolved and no longer use analogue technology as they have already upgraded to using digital technology. For external calls on the local loop, digital signals are converted using POTS (plain old telephone service). Despite PBXs going digital, they can be designed to accommodate analogue telephones into the system by including network switching systems.

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How does PBX work?

The complexity of the system determines the equipment to be used in a Private Branch Exchange. Some of the factors that FTG utilize to help ascertain the type of equipment required include; whether the private branch exchange allows for the use of both digital and analogue lines, if the PBX system is cloud-based, whether it utilizes VoIP (Voice over IP, which is most common in 2021) or whether it is an analogue-based Private Branch Exchange system with landline copper-made phone lines are connected. Copper is currently being phased out in Australia. Below is a description of the above scenarios.

With a regular PBX, copper phone systems inter-link to the on-premises phone system and get connected to a PBX box in the office. The telephony switches found in the PBX box allow for distributing all incoming calls to different telephones within the premises. All phones within the enterprise can also connect to several outside lines, also known as trunk lines, via the PBX box.

On the other hand, an IP PBX sends calls using digital phone signals instead of analogue landlines. No rewiring is needed since one can use Ethernet cables to link telephones instead of the regular telephone ones. It is possible to have IP PBX hosted by administration service providers. This is the service that FTG offer. This offers great value and flexibility. Not having to purchase a phone server and simply paying per user enables our customers to grow or retrench when needed by simply changing the number of users. Since the initial pandemic, having the ability to be flexible has never been more important. Being flexible from a cost perspective and also flexible to be able to work from home.

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Features of Private Branch Exchange

Below are a few of the PBX features;

  • Internet router
  • Telephony application server
  • Cabinets, cables, and uninterruptible power supply (UPS)
  • IP PBX
  • VoIP gateway
  • Both wireless and wired unified communications (UC) router
  • A server that has memory to enable switching of calls within the private branch exchange and out and in of it.
  • Telephone trunk lines
  • A network system of lines in the PBX

The function of a Private branch exchange call center is to handle both incoming and outgoing calls. It is also packed with features that allow for the automated handling of inbound calls, such as IVR, predictive dialer systems, and customer relationship management to capture logistics and give information about a customer to the sales people.

Some companies prefer to use a centrex (central office exchange) service in the place of a PBX. This is a group of lines located and rented in the phone company’s’ premises. Usually, they are best for small businesses.

Difference between PBX and PABX

In a nutshell, the difference between both is the ‘A’ that stands for automated. PABX, therefore, stands for a private automatic branch exchange. PABX was designed for latest automated systems but private manual branch exchange (PMBX) utilizes the traditional manual systems. Today, both the PBX and PABX mean the same thing since all telephone systems are automated.

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Private Branch Exchange vs VoIP

While a regular PBX system connects physical phone lines to enable sending and receiving calls, VoIP systems utilize the internet to transmit voice data. Therefore, VoIP technology is strongly reliant on the bandwidth at a business’s location. On the other hand, an IP PBX system will offer unlimited services because all that is needed is more trunks and extensions. Also, traditionally an IP PBX had more advanced telephone features that include voicemail and reporting, digital receptionists, queues, and ring groups. However, these are now readily available in a modern hosted VoIP solution that FTG utilize. While these features may also be available for a traditional PBX, they are hard to implement and may require a lot of additional fees.

There are several factors that an enterprise looks at while deciding on which telephone option to settle on. The cost and the size of the company are significant factors that determine what to choose. Many large companies go for the latest technology and advanced features and often consider buying a system based on their future needs. However, with a hosted solution there is no need to purchase an on premise solution that allows for future growth.

For a smaller company, the cost is the primary concern, and some will prefer purchasing digital phones to be connected to the already-in-place on-site phone lines. However, the prices will go up if newer cables have to be installed and the LAN (local area network) is not ready for VoIP. This is where FTG is the right choice as we will upgrade full network infrastructure to handle the latest VoIP technology.

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Cost of Private Branch Exchange

Pricing is an essential factor when it comes to deciding on which telephony option to choose. With more enterprises preferring to use a free or almost-free service, programs like MS Teams have become common although to enable full phone system abilities to Teams gets expensive. This is where VoIP has become an ideal choice, with many companies preferring telephone systems that eliminate or reduce short-term and long-term operation expenses.

With internet telephony services, organizations can get a balance between reliable and affordable since they have access to enhanced features and the monthly telephone rate is lower than TDM (time-division multiplexing) systems. VoIP is an example of a system that offers various services, including long-distance calling and international calls, at a much lower cost. Although the process of migrating to VoIP may take time, FTG have ways to mitigate that by utilizing Exchange Based Diversion (EBD). A company may save with the network convergence since the telephony traffic will now shift from a custom voice network to a data network. Choosing VoIP will also help save on hardware costs considering that IP-based handsets and phone systems do not need a huge investment compared to going on with the legacy systems.

It is also important to note that network upgrade to handle VoIP on LAN may have hidden costs and penalties if the organization decides to end an existing contract with a telephony service vendor. An upgrade from legacy telephone system to VoIP would also necessitate a company to expand the capacity of its network to take care of voice traffic and boost SIP trunks. An area that an FTG representative will guide a business through and if required propose simple and cost effective upgrades.

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