A PBX (Private Branch Exchange) telephone service refers to a private phone network used by a business or organization. It encompasses various communication channels like VoIP, ISDN or analog. It allows users to communicate internally (within their company) and externally (with partners and clients).

The telephone system connects calls between users within the PBX on local lines and lets them share a single external phone line through which the company can be contacted.

Here’s your guide to how PBX phone services came about, the evolution of the technology from traditional to virtual calling services, and why this type of phone system is beneficial for business.

The Brief History of PBX Phone Systems

Back in the day, when someone called a business (aka when a business received an inbound call), a human operator or receptionist from outside the company would need to manually connect the call to the relevant person using cords and a switchboard.

In the 1960s, the first iterations of PBX were introduced as a way for employees to make calls within their office or connect to others outside of it without having to go through a receptionist. Ultimately, it was a way to reduce costs by making internal and external company phone communications more effective.

By the 1990s, as the internet and computer technology experienced major advancements, so too, did telephone systems. After integrating with computers, they eventually incorporated the use of their internet connection. Today, PBX systems have a multitude of complex features including call forwarding, voicemail, missed call email notifications, call recording, extension dialing, and mobility.

What Components Make Up a PBX?

Several components make up a traditional PBX system.

  • The system includes a CPU (Central Processing Unit) that controls call switching, call logging and routing, and connecting and disconnecting.
  • A power supply module gives the phone system the power it needs. Its capacity depends on the number of extension lines.
  • Line cards are used to increase the number of extension lines in the system.
  • The operator console controls incoming calls and routes them to the appropriate extension through minimal human intervention.
  • Trunk lines are the PBX’s way of connecting to lines outside a building.

What’s the Difference Between On-Premise and Virtual PBX?

Traditional on-premise PBX telephone systems call for hardware and physical equipment to be located in the organization’s building. A trained IT professional is in charge of installing and configuring the system. With this type of system, companies are responsible for upgrades and the maintenance of security patches and system services when problems arise.

A virtual PBX system is managed by a VoIP provider for business like RingCentral. In this scenario, your provider is in charge of implementing cloud-based software and phone lines. As the world gets more and more mobile, this solution is becoming the standard for many businesses. After all, it is accessible from anywhere and uses an internet connection to keep your telecommunications lines connected. It allows employees in a company to receive calls on any phone, in any location.

Advantages of Going Virtual

The advantages of investing in a virtual PBX system over a traditional on-premise one are enormous.

Virtual has all the benefits of a traditional phone system such as voice, fax, voicemail, extensions, conferencing, paging, and intercom calling without the added expense and limitations of hardware like trunks and switches. Additionally, advanced systems like RingCentral Office include complete mobile integration, business SMS, and online meetings with screen sharing.

Because virtual systems are built with mobility in mind, it has a leg up on on-premise systems. For instance, because traditional PBX systems are physically stationed in offices, they are more prone to destruction due to accidents or natural disasters. With a cloud-based PBX, your data is managed 24/7 by a provider and troubleshooting happens in real-time, virtually. Even better, this type of system runs on multiple data centers—meaning the risk of service interruption is minimized even when it runs into some technical issues.

Probably the most relevant advantage to having virtual over on-premise hardware is the cost savings it brings to a business. For one, you avoid paying for actual hardware—which can cost thousands of dollars. At the same time, you save on the actual installation and physical maintenance of this hardware.

Virtual PBX systems are built for rapid company expansion. They give you the flexibility to add new telephone numbers and extensions as needed, and these changes can happen instantly thanks to cloud technology.

Traditional PBX systems pose various limitations that companies simply cannot afford if they want to optimize business operations.

Ultimately, you get more for less with the virtual solution.

Why Use a Virtual System?

There are other reasons why you might want this type of system for your business.

As work becomes more mobile, being able to connect with others no matter where they are is crucial to any business. Virtual PBX systems like RingCentral support employees with mobile and desktop apps that allow them to call and send messages from anywhere. Even better, with its VoIP system, third-party apps that you already use for work are integrated with the service. You can seamlessly connect apps like Google and Dropbox with RingCentral.

When you upgrade your company’s communication services to a virtual system, you improve scalability and adaptability that helps your business grow. A VoIP system lets you connect multiple office locations and employees under one unified communications system. You can also get new phone numbers, locations, phone lines and extensions at a moment’s notice with cloud-based technology.

So what are you waiting for? Going virtual is the future of business communications, and the future is here. Take control of your company’s telecommunications with the most advanced VoIP system for businesses in the market.

RingCentral is here to get your company on board with a flexible, cost-saving, PBX communications solution that puts your business at the top.