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VoIP vs. PBX – Debunking Common Misconceptions

VoIP vs. PBX – Debunking Common Misconceptions

When it comes to business communications, the terms PBX and VoIP seem to cause a lot of confusion. Too many articles treat these two things as if they are the opposite of one another. That’s not quite true.

What do you think when you see the phrase, VoIP vs PBX? You may think that they are a binary choice, and two different types of communications.

Let’s clear up the confusion. Here, we’re going to provide an easy-to-understand definition of both terms, then explore how they are actually related.

What is PBX?

PBX stands for Private Branch Exchange, a business phone system that connects office desk phones within the same network. It allows employees within a company to make calls to one another and to transfer calls for free. With a PBX phone system, a business can have multiple phones sharing fewer lines. That’s because rather than using physical phone lines, extensions are used to redirect phone calls to the intended receiver.

Traditional PBX connects to physical phone lines through dedicated hardware devices, so that the voice network and data network within a company are completely independent. With the introduction of IP telephony and the trend of ISDN & PSTN switch-off, analog phone systems are becoming obsolete.

What Is VoIP

VoIP is an acronym for voice-over-internet protocol. It’s simply a technology used to transmit voice data via an internet connection. A VoIP phone system takes your voice, turns it into file data, compresses those files, and then converts those files into packets of data. All of this happens in real-time. It’s virtually instantaneous. These packets are sent over the internet to a VoIP provider. The provider converts them back and sends them to the other phone.

Even though many things are happening during this process, a VoIP call is just as fast as an analog call.

People who were around when this technology emerged may be suspicious of it. Initially, VoIP providers had a difficult time successfully completing even a low level of service. That’s changed today. The sound quality of VoIP might be affected by the bandwidth and the device used. However, most VoIP providers now offer various different protocols and codecs to ensure HD audio quality.

A VoIP solution can also work fine for businesses of many sizes, not matter small and medium-sized companies or large enterprises. Read through to check out additional benefits of VoIP PBX systems.

So What is VoIP PBX?

VoIP (Voice over Internet Protocol) PBX (Private Branch Exchange) is a phone system that works similarly to standard PBX. The difference is that it makes use of a wide area network or local area network instead of the traditional switched networks used in older public switched telephone networks (PSTN) systems. It is also known as IP PBX.

A VoIP phone system can use VoIP to switch phone calls on local lines, between a VoIP user and a landline user, or between two traditional telephone users. IP PBXs can be set up using hardware, or consist entirely of installed software.

Besides on-premise VoIP solutions, there’s another option known as a hosted PBX solution. This is cloud-based and offered up by business VoIP providers. Hosted PBX offers virtually the same features, but doesn’t require complex on-site installation and equipment.

Why Do People Compare PBX and VoIP?

The term PBX may have different definitions for different people. Some people think that PBX is the same as traditional PBX, while others think that PBX is actually another term for the business phone system.

When most people compare VoIP with PBX, they actually want to compare PBX systems like VoIP PBX, IP PBX, hosted PBX with PBX systems like analog PBX, TDM PBX, and proprietary PBX. Next, we will show you their differences and the pros and cons of each type of PBX system.

Benefits of VoIP Phone Systems over Analog PBX

Lower Initial and Operational Costs

Landlines generally cost much more than VoIP solutions. Let’s start with the installation. Landline setup is usually charged a certain amount of money, while SIP trunking used in VoIP solutions requires little or no setup cost.

More importantly, since the calls are transmitted over an IP network, monthly service fees and calling rates are much lower for IP PBX users. The cost of internal calls could be reduced to almost none. You can also have a significant amount of expense from International and mobile calls typically.

Worksheet TCO Analysis: Calculating the Real Cost of a PBX Phone System

Mobile Team Support

Many VoIP PBX service providers offer mobile, web-based, or desktop softphones, which can turn your cell phone and computer into an office extension just like a desktop phone. This is very useful for multi-location offices, the remote workforce, on-the-go employees, and field workers. Traditional PBX phone systems are simply unable to support BYOD (Bring Your Own Device) mobility and help users break geographical boundaries. It just can’t adapt to the upward trend of hybrid work.

Advanced Telephony Features & Unified Communications

Traditional PBX generally only comes with limited basic features, and even if some systems can provide more, they usually require a lot of additional fees. IP PBX, on the contrary, offers a range of advanced telephony features like IVR, queue, voicemail, call recording, etc. They can even be license-free, depending on your service provider.

Better yet, VoIP solutions make it possible for you to embrace unified communications. This way, you will be able to enjoy more communication channels and functions, such as video conferencing, instant messaging, presence, CRM integration, etc. This is a major step toward digital transformation for any business.

Related What Is Unified Communications?

Easier Installation & Management

Compared to analog PBX phone systems, IP PBX systems are not only more user-friendly but also easier to install, configure and manage. With data and voice delivered on the same network infrastructure, you can not only reduce costs but also save a lot of time in the equipment installation and wiring of physical telephone lines. Some analog PBX phone systems can only be managed via complex commands that are proprietary to each vendor. In contrast, IP PBXs often provide an intuitive web-based management interface that allows IT staff to quickly and easily configure the VoIP system and its many features.

Phone Compatibility

Phones supported by analog PBX systems are usually very limited. Analog PBX phone systems usually require proprietary phones from the same vendor, which means you are locked into that one vendor and unable to use other solutions. A decent IP PBX provider usually offers a highly compatible PBX phone system that allows you to plug and play most mainstream IP phones as well as use analog phones via VoIP gateways. Better yet, they also provide softphones to make web browsers, your mobile phone, and your computer as SIP endpoints.

How To Choose The Right Business Phone System?

When choosing an enterprise phone system, you usually need to consider a variety of factors such as the size of the business, IT staff resources, and your requirements in functionality. Review the following to explore which business VoIP system is the best choice for your company.

Is your company’s network connection stable enough?

As mentioned before, with the phasing out of ISDN and PSTN lines, today’s future-proof business phone systems use mostly VoIP technology, which requires a stable and fast internet connection. This is the very first thing you need to confirm before purchasing any IP PBX. For areas with limited landline or SIP connection, VoIP GSM/3G/4G Gateway could the best alternative for business communications.

Do you have in-house IT staff to manage and maintain the PBX system?

The answer to this question greatly influences your choice between an on-premise IP PBX and a cloud PBX system. If you have technicians with the required expertise and you prefer the maximum control over your business phone system, an on-premise IP PBX is a great choice. However, for small businesses or start-ups lacking in IT resources, it will save you a lot of effort to choose a hosted voice solution and have it is taken care of by your service provider.

Does your company has any significant staffing changes in the near future?

Analog PBX phone systems are usually more costly and cumbersome to add lines and new users while VoIP phone systems are much easier to scale. Particularly, cloud PBX systems are more flexible for companies with staff growth or reduction over the course of the system’s lifespan. The number of extensions may be increased or decreased instantly, and you only need to pay for what you require. It is particularly beneficial for seasonal businesses with fluctuating communication needs or start-ups that are experiencing rapid growth.

Does your business operate in multiple locations?

If so, you may come across this question – “does it matter if I opt for on-premise or cloud-based PBX? While both phone systems can support organizations with multiple locations, they are implemented differently. Cloud PBX makes it easier to connect headquarters, branch offices and dispersed telecommuters under the same phone system. Some on-premise PBX providers also offer a variety of multi-site solutions, such as Yeastar Remote Access Service.

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User Login

Instantaneously receive user login credentials via email once the extension has been deployed by the adminstrator.

Log in conveniently via any web browser for access to the user portal.

Integrations

Integrate various CRM software for better customer service and satisfaction.

Enable transcription of audio messages into text with integration of third-party transcription service.

Enable API for integration with various third-party integrations for advanced performance such as call center and hotel reception services.

System

Provision email SMTP and template settings for event notifications to be sent out.

Manage storage allocation and duration of various types of data being stored on the PBX.

Determine the types of event notifications to be sent out, and the parties receiving them.

IVR

Add various audio voice prompts to be played according to different call scenarios.

Add voice prompts on multiple levels for more effecient and precise inbound call routing.

Voicemail

Customize default voicemail settings for each user extension.

Add various voicemail messages for allocation to different call scenarios and users.

Provision specific rules to how voicemail messages are played over the PBX system for better caller experience.

Reports and CDR

All call log activities are stored, with the option of having audio conversations recorded by default or for specific extensions.

Use intuitive visual call reports, to check various call statistics over extensions, trunks, queues, ring groups, and more.

Call reports can be viewed and downloaded directly from the PBX, or scheduled to be sent via email to respective parties.

Security

Restrict a general group or specific IP addresses to prevent unauthorized access to your PBX.

Limit the number of otbound calls users are allowed to make within a time period to protect against toll fraud.

Restrict certain country codes for outbound calls either company-wide or on certain extensions.

User Login

Determine extension ranges for different functions.

Define use of different voice prompts depending on call scenarios or intended function.

Provision basic and advanced SIP settings to be used on the PBX.

Recordings

Record all calls made on specified trunks, including inbound and outbound calls.

Recordings

Record all calls made on specified extensions, conferences, or call queues.

Paging and Intercom

Create different types of paging and intercom broadcast groups for selected extensions.

Set a time schedule to automatically start your broadcast.

Maintenance

Check for and download firmware upgrades to ensure that your PBX is always up-to-date.

Perform back-ups to prevent data and settings from getting lost.

Perform troubleshooting on your own to debug.

Conference

Pre-set conference settings and dial-in passwords for security, and allow internal users to send conference invites to external parties.

Speed Dial

Create multiple speed dial numbers to respective external numbers frequently used for outgoing calls.

Speed dial is activated when the set prefix (default or customized) is dialed.

Ring Group

Create multiple ring groups and determine custom ring strategies and failover settings for each.

Call Queue

Create different call queues with specific ring strategies and failover settings.

Static agents permanently answer calls in queue, while dynamic agents can log in and out. Allocate different extensions to each group.

Determine what actions are to be allowed for Mangers or Agents to manage on the Queue Panel.

Call Control

Have calls received on specific SIP trunks routed to designated extensions or destinations within the PBX.

Set-up dial patterns so that outbound calls are routed to their intended destinations.

Determine how calls are routed and received at different times of a day.

Contacts

Store, retrieve, and share company contact details easily on your PBX.

Organize company contacts into dedicated phonebooks and determine accessibility rights to extension groups for each.

Bulk import a list of contacts instead of having to key details in individually.

Role and Client Permission

Pre-defined user roles within the PBX are conveniently available for allocation, or create your own set of permissions.

Restrict users from viewing specific extensions, departments, or extension groups with Extension Visibility.

Allow or resrict specific users from managing or viewing certain company contacts

Auto Provision

Pre-defined setting parameters specific to respective IP phone models are conveniently available for easy set-up.

IP Phones can be quickly provisioned to your Yeastar PBX with just the pre-defined template and device MAC address.

Trunks

Register multiple SIP trunks on a single PBX as needed.

Different types of trunks can be created, Caller ID can be customized.

Extensions

View, deploy, add, and remove user extensions within your PBX system.

Configure default call and user settings for individual extensions.

Customize allocation of user extensions to specific ring groups.

Portal Login Page

Receive your administrator log-in credentials and set-up guide via email.

Log-in on any web-browser to get started with PBX set-up.

Installation Wizard will guide you through basic configurations.

User Login

Access all company contacts made available to you by the administrator.

Create your own personal contacts list for easy reference and dialing.

Bulk import contact details for convenient data entry.

User Login

Access and manage user settings for softphone application and voicemail.

Manage call routing and presence status for your individual extension.

Retrieve or download your personal call logs and recordings.

User Login

Receive your log-in credentials and set-up guide via email, sent by your admin.

Log-in on any web-browser to get started with PBX set-up.

Configure contacts and personal settings from the web portal.

Auto Provision

Add, remove, or modify IP phone settings from your web interface.

Upgrade IP phone firmware conveniently from your PBX.

Upload various default setting parameters specific to respective IP phone models for greater convenience during set-up.

Contacts

Store, retrieve, and share company contact details easily on your PBX.

Have detailed contact information for your vendors and clients conveniently stored .

Bulk add a list of contacts instead of having to key details in individually.

PBX Monitor

Monitor the status extensions, whether they aren idle, in use, or unavailable.

Know whether your SIP Trunk running properly, or experiencing problems.

Monitor the number of call conferences currently running on your PBX, and their individual durations.

Maintenance

Check for and download firmware upgrades to ensure that your PBX is always up-to-date.

Perform back-ups to prevent data and settings from getting lost.

Perform troubleshooting on your own to debug.

Call Detailed Report

All call log activities are stored, with the option of having audio conversations recorded by default or for specific extensions.

Filter by date, time, or extension number to retrieve specific call logs or recordings

Playback call recordings directly from the PBX or download to store externally.

Event Center

Determine what events and logs are to be recorded and/or have notifications sent.

Specify particular notifications to be sent to respective authorized personnel.

User Permission

Set up vaious groups of users for allocation to certain sets of access rules.

Determine what features a certain group of extensions can or cannot access.

Determine if users can access, play-back, or download call logs and recordings from the pbx.

Security

Restrict a general group or specific IP addresses to prevent unauthorized access to your PBX.

Determine specific the range of SIP ports for connection between your PBX and endpoints.

Restrict country codes for outbound calls either company-wide or on certain extensions.

Voice Prompt

Upload and designate customised audio recordings at multiple levels of a call journey.

Upload recorded music to fill the silence that would be heard by callers on hold.

Upload customised voice prompts to create a professional call experience.

General

Customize general call preferences either company-wide or for individual extensions.

Set-up feature dial codes for convenient user navigation to specific call features.

Determine how voicemails are retrieved, and also upload custom voicemail recordings.

Call Features

Add multiple automated responses to be played at different phases of a call journey.

Designate specific extensions to ring concurrently based on an external caller's dial pattern.

Customize messages and waiting times to keep external callers engaged when put on hold.

Call Control

Have calls received on specific SIP trunks routed to designated extensions within the PBX.

Set-up dial patterns so that outbound calls are routed to their intended destinations.

Determine how calls are routed and received at different times of a day.

Trunks

Register multiple SIP trunks on a single PBX as needed.

Provision SIP trunk settings and dedicate them to particular extensions.

Bulk add DDIs on each SIP trunk, for allocation to an individual or groups of extensions.

Extensions

View, deploy, add, and remove user extensions within your PBX system.

Allocate and deploy specific extension numbers to respective users via email.

Set-up default ring and presence status settings for individual users.

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Deal One View

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View cases created for a Deal in One View.

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Deal One View

View cases created for a Deal in One View.

View cases created for a Deal in One View.

View cases created for a Deal in One View.