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What Is a PBX Phone System? Which One Is Right for Your Business?

Abhishek Bhargva

Telco ICT


PBX Phone System

Are you still searching for the best business phone system out there?  

We get you. It can be too overwhelming for a buyer due to loads of information or options available. Since we, at Telco ICT, excel in helping out clients to find the right phone system to fit their business needs, you can rely on our expertise.  

We have listed down the different types of PBX phone systems to help you understand which one will be the perfect fit for your business.  

First, let’s understand about the PBX phone system. 

What exactly is PBX?

Private Branch Exchange (PBX) can be perceived as the internal telephone network for your business. Users can communicate with each other through internal lines/phones and even make/receive external calls, thanks to the PBX phone system.  

Your business can get voice mail, auto-attendant, call queue, call transfer and call forwarding features through PBX phone system. By leveraging Voice over Internet Protocol (VoIP phones) or digital phone lines, PBX systems are operated. And, the physical phone lines entering into your business can also be split into multiple lines.  

Best part: Calls among users are free! 

Types of PBX phone systems

If you have shortlisted the PBX phone system for your business, then there is still some decision work that needs to be made. Below are the types of PBX phone systems we have listed for you: 

Analog PBX Phone System

It gained a reputation for being a typical telephone system as it’s been used by businesses since decades. Connected through Plain Old Telephone Service (POTS) lines to the Public Switched Telephone Network (PSTN), it can even handle fax transmissions using physical phone lines. 

Calls can be made or transferred within a certain location through the analog PBX phone system. Besides, they can even handle outgoing/incoming calls by using outside lines. 

Please note that they were around when traditional copper lines were in vogue, and the time when the Internet was never heard. Thus, you cannot expect the latest features such as remote working ability, converting voicemail to email or any multimedia services.  

Let’s say in the near future, your business grows, then you might have to add new telephone wires or new jacks to accommodate new employees, it can be a problem.  

Although a little old-school, they work fine even when there is no Internet connection. Amazing!  

VoIP PBX Systems

IP PBX or VoIP phones work just like traditional PBX and can be best described as a new version of private branch exchange.  

How does IP PBX differ from traditional PBX systems?

Hosted PBX

  • Offers extra features 
  • More cost-effective option 
  • Instead of traditional phone lines, it uses Internet protocol 
  • Voice gets converted into data, later to be transmitted through the Internet. Vice-versa. 
  • Maintenance is super simple 


  • Video conferencing 
  • BOYD (Bring Your Own Device) 
  • Messaging 

On-Premises PBX system

It is a little different from PBX telephone systems but still leverages VoIP phones technology to manage telephone systems. Please note that servers managing incoming/outgoing calls are maintained on-site. But the features are still the same offering support for mobiles devices, voicemail to email conversion and using Internet connectivity. 

Challenges of On-premise PBX:

  • Initial upfront cost of installation 
  • Need to have IT staff with good expertise 
  • Proper maintenance of phone systems 

Good part:

  • After expenses gets covered, you will be free from fee raises as cost goes down with time 
  • Lets you retain relationship with current phone service provider 
  • Flexibility to configure your system internally 

Cloud PBX Systems

Cloud PBX, a subtype of an IP phone system, is also described as hosted PBX. It runs by leveraging Internet connection to VoIP phones service providers. Except physical phones & an Internet connection, no on-site equipment is needed, since everything is handled by the service provider.  

All incoming/outgoing calls are routed through the service provider to transmit the voice to data packets and even handling calls off to Public Switched Telephone Network (PSTN). 

All you need to do while using hosted PBX phone systems is a strong broadband connection to the Internet that supports many telephony devices such as smartphones and office conference phones.  

Benefits of opting for Hosted PBX Phone Systems

  • Integration with CRM, Microsoft Teams, & other 3rd party systems. 
  • Plug-and-play set up 
  • Ideal for small businesses with no funds to invest in telephone infrastructure 
  • Features to empower customer support teams 
  • Collaboration features that include conferencing, instant messaging, and screen sharing 
  • Supporting on-site & mobile workers 
  • Easy installation and maintenance of unified communications systems  
  • Scalability 
  • No hardware equipment & professional IT staff needed. 

Benefits of On-site PBX

  • Lesser operational costs 
  • Extra control by owning equipments 
  • Building relationship with telephone company 
  • Zero annual or monthly licences/subscription fees 
  • Much ability to determine security level 

Which one is right for your business?

Now that you have got enough idea about the PBX system, it’s time to decide which type works fine for your business. You need to assess your needs and accordingly pick out the right option. 

Below are few things to consider: 

1. Operational model

Do you have your workforce mostly at the office or do they have to be on field to connect with the outside world? How exactly does your organization work? Is your staff more tech-savvy or more old-school?  

2. Budget

Whenever services are implemented, they come with certain costs. Some services can be virtually free depending on the choice you make. For instance, On-premises VoIP phones or hosted PBX lets you add/remove lines without any hassles at zero cost. But, if you go for analog configuration, it will lead to physical installation costs or paying up for new lines. 

3. Business size and projected growth

Do you have a small/medium sized enterprise or larger enterprise? Is it expanding or shrinking in business? Will the number of lines get impacted when you adapt to any type of technology? Will you need features such as remote work support, video conferencing or call routing? 

4. Infrastructure

Before going for the best PBX phone system, you need to ask the following questions regarding existing infrastructure: 

  • Are you working from a single or multiple offices? 
  • What is the type of legacy system you got to integrate with the new telephony solution? 
  • Which solution is your business using for telecom these days? 
  • Got any in-house IT staff? 
  • If yes, are they experts in telephony concepts like SIP trunking? 

Well, if you still have any questions or queries while exploring the right phone system to fit your business needs, the Telco ICT can help you out. Meanwhile, you can also explore our wide range of VoIP phone systems available to make an informed decision. 

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