More than 70% of companies switch today from legacy PBX phone systems to VoIP, but still, the majority of companies use PBX for daily communication. The decision whether to use PBX vs VoIP seems formidable. There is decades of heritage of PBX associated with reliability, and it is expensive to install and own. VoIP makes calls over the internet in an attempt to reduce companies’ expenses, enable remote work, and expand without additional hardware.
At Dialer Portal, we’ve helped hundreds of businesses upgrade from outdated systems to modern VoIP without stress. In this post, we’ll explain what PBX and VoIP mean, how each works, and which one is right for your budget and team. Scroll down to learn how you can save money and simplify your phone system.
What is PBX?
PBX is an abbreviation for Private Branch Exchange. It refers to a business phone system for managing calls within and external to the enterprise. Rather than every employee having his own individual phone line, a PBX links all office phones to a single network. This setup lets staff call each other using short extensions, transfer calls, and share the same external phone lines.
A PBX can be a physical box that is installed in your office or a virtual one that is accessed. The older one utilizes copper phone wires and equipment that resides in the house, but more recent models may traverse the internet.
In short, a PBX is the office call traffic cop. It routes calls to the correct individual, links employees with each other within the building, and controls features such as voicemail or transferring a call. Companies generally employ it to minimize the cost of phone lines and keep communication structured.
What is VoIP?
VoIP is short for Voice over Internet Protocol. VoIP is a technology that allows individuals to use the internet for making phone calls, not phone lines. Speech in VoIP is converted into digital, is transmitted via the internet, and is converted back into sound when received.
In contrast to outdated landline technology, VoIP doesn’t require bulky phone equipment. You can call with a computer, a smartphone, a tablet, or a VoIP office phone. It just requires internet access.
VoIP also supports other calls other than voice. It is able to support video calls, instant messaging, and file transfers. This makes it a handy method for business corporations and individuals to communicate from almost anywhere.
PBX vs VoIP: Key Differences
Knowing what is the VoIP and PBX difference can guide companies into selecting the proper telephone system. Following is how they rate on the most critical factors:
Cost
A PBX phone system vs VoIP can differ a lot in price. PBX needs a big upfront investment for hardware, installation, and wiring. VoIP uses the internet, so most costs come from monthly service plans. VoIP is usually cheaper to start and easier to manage over time.
Flexibility
PBX systems work best in one office because they depend on physical lines. VoIP, however, can be utilized anywhere there is internet access. Workers can take and make calls using their laptops or cell phones, even at home or away from the workplace.
Maintenance
A traditional PBX needs technicians to fix issues and upgrade hardware. This can be time-consuming and expensive. VoIP equipment is stored on the internet by providers, so companies do not require on-staff experts or additional maintenance teams.
Features
PBX is usually for voice calls and basic call routing. VoIP provides some additional features such as video conferencing, call recording, voicemail-to-email, and smartphone apps. These additional features allow teams to stay more connected between locations.
Scalability
Installing additional phone lines on a PBX takes a long time and is costly in cabling and hardware upgrades. VoIP cuts the procedure to a snap—you can add a new user in seconds without installing extra lines or equipment.
Reliability and Security
PBX systems are not affected by internet interference, so they can be very stable. VoIP relies on the internet, so there must be good connections and adequate security. Encryption and backup systems are utilized by most providers to secure and make VoIP calls reliable.
Choosing Between PBX and VoIP: The Pros and Cons
Ready to choose your business communications system? If you need a bit more help, here’s a summary of the pros and cons of PBX and VoIP:
PBX Pros and Cons
Pros of PBX
- Reliable during outages
A traditional PBX uses landlines, so it works even if the internet goes down. Businesses can keep calling without worrying about connection problems. - Clear and consistent call quality
PBX systems use stable phone lines, which often provide better sound quality compared to internet-based calls. - Familiar and easy to use
Most employees already know how to use PBX phones. There’s little to no training needed for basic functions like transfers and extensions.
Cons of PBX
- High setup and maintenance costs
PBX is wired, equipment-based, and must be maintained periodically. Upgrading or maintenance usually requires a professional, hence expensive. - Limited flexibility for remote work
It works best in one office location. Staff cannot easily make or receive calls if they’re outside the office network. - Hard to scale as you grow
Installing new phone lines or relocating to another facility is time-consuming and costly, involving more equipment and installation.
VoIP Pros and Cons
Pros of VoIP
- Lower costs for businesses
VoIP needs no heavy hardware and uses the internet, so setup is cheap. Monthly service plans often cost less than traditional phone lines. - Flexible for remote teams
Employees can take and make calls anywhere through a laptop, smartphone, or VoIP deskphone provided there is internet connection. - More features for communication
VoIP provides video calling, voicemail-to-email, recording, and mobile apps. These features enable teams to collaborate and be productive.
Cons of VoIP
- Depends on internet quality
VoIP will fail if the internet is jumpy or slow. Companies require solid, good connectivity for seamless calls. - May need special devices
Certain setups demand VoIP-compatible headsets or phones, which are an added cost to new users. - Security needs attention
As VoIP is internet-based, companies need their provider to ensure it is encrypted and secure from hack or data loss.
Conclusion
Having to decide between PBX and VoIP is a tough choice for any business. Both choices unite your employees and customers, but they accomplish it in wildly different ways. The old-fashioned PBX is perfect for businesses that want a good in-house phone system and don’t depend on the internet. It’s easy to understand, but it is extremely pricey to set up and difficult to make larger as your business grows.
VoIP provides you with flexibility, however. Your workers can labor wherever they are, and it is easy to add more users. It is economical, particularly for firms with remote workers or multiple facilities. With options such as video calling, voicemail-to-email, and call forward, VoIP makes your company contemporary and connected.
Regardless of whether you are deciding on PBX phone system vs VoIP or require assistance comparing cloud PBX vs VoIP, Dialer Portal is ready to assist. We assist companies in deciding on the right system, implementing it correctly, and in saving costs in the process. Ready to make the transition? That’s easy: contact Dialer Portal today and discover the advantages of hosted VoIP for your company. Sign up today and simplify your communication, make it flexible, and save money.
FAQ’s
What is a PBX and how does it work?
A PBX is a phone system that connects office phones to each other and to outside lines. It helps route calls, transfer calls, and manage extensions.
What is the difference between PBX and VoIP?
A PBX uses landlines and hardware in your office, while VoIP uses the internet to make calls. VoIP is cheaper and more flexible for remote work.
Can I switch from PBX to VoIP and keep my number?
Yes. Most providers let you keep your old phone number when you move from PBX to VoIP.
Is VoIP reliable for business calls?
Yes, as long as you have a strong internet connection. Many providers also use backups and encryption to make VoIP safe and stable.
What are the benefits of hosted VoIP?
Hosted VoIP lowers costs, adds features like video calls, and works for remote teams without needing heavy hardware.