PBX System: Definition, Features and Benefits

December 28, 2022


A private branch exchange is a phone system within a company that routes calls between users on local lines, allowing all users to share multiple external phone lines. 

Unlike the Public Switched Telephone Network (PSTN), the main purpose of PBX is to save the cost of requesting a line to the telephone company’s central office for each user.

A PBX phone system typically includes call forwarding, call forwarding, call queue, auto-attendant, voice mail, etc. provide business phone features such as

PBX systems work through VoIP (Voice Over Internet Protocol) or analog or digital phone lines. With a PBX phone system, the physical phone line to your business can be split into multiple lines, allowing you to support more calls. Even better, calls between users are free.

Types of PBX Systems

There are three main types of PBX systems: hosted, on-premises, and SIP trunk.


With a hosted PBX, your business phone will be in the cloud. Setting up a hosted PBX system only requires signing up for service and purchasing the actual phone. 

Setting up takes minutes, not weeks, and cloud hosting lets you add or remove some extra features. Plus, as an account manager, you have full control over your business calls.

On premise

If you don’t expect your company to grow, an on premise PBX system can be very convenient. This is because the cost of an in-house system can be lower than the long-term cost of monthly payments for a hosted PBX system.

SIP Trunk

SIP trunk allows you to convert your existing landline PBX to a cloud-based phone system, reducing costs and expanding existing features. This includes tools such as softphone applications and reporting analytics.

How Does a PBX Work?

The equipment used in a PBX varies depending on the complexity of the system – for example, is it a traditional PBX with copper phone lines, or is the PBX a mix of analog and digital lines or with voice?

Traditional PBX phone systems use copper-based phone lines that run into the business premises connected to the PBX box. The box contains a telephone switch that allows calls to be distributed to different telephones in the office and a telephone switch that allows access to a limited number of outside lines – trunk lines.

IP PBX, or Internet Protocol PBX, uses digital phone signals instead of analog phone numbers to send calls. Because users can use an Ethernet cable to connect the phone instead of a traditional phone, there is no need for rework. IP PBX systems can also be deployed by managed service providers.

Advantages of PBX

The equipment required depends on the complexity and use of the PBX – for example, the type of telephone used at a particular site.


  • Telephone trunks (multiple telephone lines) terminating in the PBX.
  • A computer with memory that manages the switching of incoming and outgoing calls to the PBX.
  • PBX inside line.
  • Ultimate Communications (UC) Router – Wireless and cable.
  • Telephony – Universal Serial Bus (USB), VoIP and Session Initiation Protocol (SIP).
  • VoIP gateway.
  • Internet router.
  • Cable, cabinet, uninterruptible power supply (UPS).
  • Phone application server.

Features of PBX System

PBX phone systems have many features that help differentiate business phone systems from home phone systems. Here are just a few examples of some of the key features of a hosted PBX system:

Online portal management

With a remote PBX system, businesses and users can manage and edit certain phone functions through an online control panel. 

It becomes a central point for users to centralize basic functions such as creating ring groups, creating new phone extensions and endpoints, creating call routes or setting up SIP trunks.

Virtual presence

The presence feature allows team members to find out if their colleagues are available on another call or offline, allowing them to handle incoming calls accordingly.

Automatic attendant

The automatic attendant features of our PBX system allows callers to choose several options to route their calls to the appropriate person or department.

Call reporting and analytics

If you run a large call center or manage a large sales force, call reporting capabilities are essential.

They provide you with real-time phone analytics about your business phone usage, including:

– Time spent on the phone.

– Number of calls answered, missed and toll free.

– This is the most popular time for calls.

– Which team member answers the phone the most?

Each one gives you a better understanding of how your business uses the phone system.

For example, if you see that sales rep #1 spends half as much on sales calls as other calls, but closes the same number of deals, you can ask them to share their script. Accessing phone data makes it easy to find quick wins or pain points. Unlike a traditional PBX, you can see exactly where your team is spending their time.

Interactive voice response

Interactive Voice Response (IVR) is like an automated attendant, except instead of pressing a number on your dial pad, you just say the department you want to be directed to. There are two types of IVR. Basic IVR as described above and advanced IVR consists of AI talking. Both options are suitable for businesses with high incoming call traffic.

IVR is a great way to stay on brand and your business communication policy. It also allows you to offer self-service options for customers.

Local and toll-free phone numbers are free

Customers can charge the phone if they call a business toll-free number. But with a toll-free number, there is no additional cost to contact the customer. Your business caller ID will show the area code that does not charge extra.

This phone number can also have a positive impact on the sales team. According to TollFreeNumber.org, people who call toll-free numbers order more products and higher-end items.

The Area Code is not important for customers to see if they will be charged extra. An unknown area code in caller ID can cause calls to go unanswered.

According to Software Advice, people are four times more likely to answer calls from local numbers. Check to see if your provider offers free local virtual numbers to earn money from trusted people with well-known local area codes.

Audio and video conferencing

Cloud PBX systems are not limited to making and receiving calls. Some providers allow you to make video and audio conference calls with your team. It works by creating a virtual meeting room, called a conference bridge, with the appropriate access code for your team to join. 

They can use any Internet-connected device, including a softphone, VoIP headset, or cell phone, to participate in the meeting. Everyone can hear conversations, jump in where needed, and even share their screen for better collaboration.

The best part? Call quality doesn’t suffer when you’re on a conference call. Since VoIP calls are made over the Internet, conference calls require only powerful bandwidth.

Phone encryption (TLS and SRTP)

In the US, a data breach can cost businesses an average of $3.68 million. It’s no surprise that security is a key factor when choosing a cloud PBX phone solution.

However, VoIP calls are very secure if your provider offers phone encryption. Access phones add two layers to a digital connection, including:

– Transport Layer Security (TLS)

– Secure Real-Time Transport Protocol (SRTP)

Both of these means that your phone is encrypted. Hackers can not eavesdrop on internal or external phones.

Voice mail to send email

Most business phone systems have a congested and disorganized voicemail system. With a cloud PBX phone system, that doesn’t have to be the case. Voicemail to Email is a feature that takes a recording of your voicemail and sends it to your email inbox.

Every time a voicemail is left on your VoIP account, an email and an MP3 file will be sent. You can then listen to it on your computer and follow along at your convenience.

Some providers also offer voicemail transcription features. It will send the same voicemail, only you will see the text and transcribe it as text. Make it easy to return calls, take notes, and share call information with your team.

Advanced call routing and queuing

The main advantage of using a split PBX is call routing and call queuing. Agents cannot answer all calls immediately, but callers will be added to the call queue if the call fails or is put on hold. 

An automated message tells you where the line is, how long you’ll have to wait, and thanks you for your patience.

If you call the wrong group, advanced call routing routes the call to the most appropriate agent. Callers do not have to queue. This makes call routing and queuing ideal for high-volume call centers.

Click to call

By tapping the call option, you can directly call a local business by tapping the phone number on your device – so you can think of this feature as a one-touch call.

Click to Call allows you to leverage web traffic and make it easy for customers to call you. You don’t need to copy and paste it to your mobile phone. They just press the phone button and connect.

Enterprise level reliability

Cloud-based phone systems offer one advantage over traditional installations – the network is managed by engineers. Check whether your provider has a dedicated security team at the data center location. 

That way, they can monitor and fix any security vulnerabilities and ensure that the network is always up and running. Fortunately, Asterisk2VOIP has an uptime of 99.999%, which means no downtime for your business.

Why Choose Asterisk2VOIP’s PBX System?

As more and more businesses are under pressure to make their business communications faster and more mobile, switching from legacy phone systems has become a priority for many. 

As cloud-based, integrated systems become the order of the day, software-based solutions are a no-brainer for businesses to make their organizations more agile, scalable and cost-effective.


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