Deciding which phone system is best for your business takes time to plan, research, and shop. To make an informed decision, you need to know what your choices are and the pros and cons of each. The phone system you want is one that meets your business’ needs. Because your business is unique, what works for another business may not work for yours. But if you want to replace or upgrade your phone system, you will need to choose between a PBX and a VoIP system.
What is a PBX System?
A PBX phone system is the on-premise phone system that has been in use for decades. It only came with direct copper wire line-to-line connections but in recent years has more options for the circuit that connects to it. If connected to the phone network with analog or digital lines, you are physically connected through the exchange network.
What is a VoIP System?
With a VoIP system, voice signals are converted into packets of data that are transmitted over the Internet. That means when you call a client, these signals travel through your network and out to the Internet.
Don’t get confused with the different types of VoIP systems that are out there. There are the following three options to choose from:
- On-premise VoIP System, Self-managed (you manage this system yourself)
- On-premise VoIP System, Partner-managed (a provider manages this system for you, but its brains are located at your place of business)
- Hosted VoIP System, Partner-managed (a provider manages this system for you, but its brains are located in the cloud)
Another confusing point is that there are a variety of names people are using for VoIP. They are all referring to the same type of internet phone system. Here are a few of them:
- Hosted VoIP
- Hosted Voice
- Cloud Voice
- IP telephony
- Internet telephony
- Broadband telephony
- Broadband phone service
The Plan: Questions you need to answer for your business
- How many users do you have?
- Is everyone centrally located or geographically dispersed?
- How will they use your phone system?
- What features are you looking for in a phone system?
- What is your growth trajectory?
- How much are you spending on your current phone plan?
- What is your budget for your new phone system?
VoIP is the less expensive system compared to PBX. It requires less hardware, which ends up costing you less to install. You will need VoIP-enabled phones and a connection to the Internet. Your monthly bills are also lower with the VoIP system and your billing is less complicated because your Internet and phone bill are often combined.
Direct copper wire line-to-line connections are always more reliable than Internet connections, which sometimes experience downtime or bandwidth limits. The quality of your VoIP connection will vary based on the quality of your Internet connection. If your Internet or power goes down, so will your phone system. PBX systems are set up independent of your internet.
Because of this, some businesses who choose VoIP will keep a few backup analog lines for emergency alarms that send signals to the fire or police department or for their fax machines that don’t work well with VoIP.
If you want more flexibility in terms of adding or removing users, choose the VoIP system. You can add as many users as your network’s bandwidth allows and increasing your bandwidth is usually an easier task than increasing PBX capacity.
PBX systems are not known for their flexibility. They are installed with the number of phone lines you initially choose. If your company grows and you need more phone lines or capacity, you will have to have a provider come out and install them.
A quality phone system that is compatible with your company’s needs is key to clear communication and productivity. We hope this guide helps you in your decision process of whether to go with a VoIP phone system or a PBX. If you have any questions or need further guidance, please give Fred (Idaho) or Joe (Utah) a call at (844) 400-0616.
Read a story about how our service engineers repaired a client’s VoIP phone system when they were experiencing Dropped VoIP Calls and Intermittent Internet Connection.