What Is a PBX Phone System and How Does It Work?

A PBX (Private Branch Exchange) is a private telephone network that companies or organizations use to manage incoming and outgoing phone calls, as well as communicate internally.

A Private Branch Exchange is called to connect telephone extensions to the Public Switched Telephone Network (PSTN). The latter is the aggregate of the world’s circuit-switched telephone networks, which are operated by national, regional, or local telephony operators, providing infrastructure and services for public telecommunication.

As compared to proprietary systems, PBX phone systems usually deliver much more flexibility since they use open standards and interfaces. The operation of contemporary PBX phone systems is based on standard hardware, which is more affordable and can be replaced more easily, which can’t be said about closed systems.

Private Branch Exchange (PBX) Structure and Operation.

The term PBX was first used to show how switchboard operators managed company switchboards through the manual use of cord circuits. Later, the manual systems were replaced by automated electromechanical switches and electronic switching systems.

To distinguish between these two systems, the terms PABX or private automatic branch exchange and PMBX or private manual branch exchange began to be used by the professionals in the field. Nowadays, PBX is the most widely-used in the industry and refers to complex, in-house telephony switching systems of all types.

A PBX or Private Branch Exchange consists of both hardware and software. It connects to communication devices the way telephone adapters, hubs, switches, routers and telephone sets do.

These systems feature different sizes and complexity: you can find both too expensive and complex corporate communication PBX systems, as well as basic plans that are hosted on the cloud for a 2-digit monthly fee. You can also find simple PBX systems at home designed with basic features, serving as an upgrade to your existing traditional phone line.

A PBX is made up of:

• Telephone trunk (multiple phone) lines that terminate at the PBX
• A computer with memory that’s responsible for managing the switching of the calls within the PBX, and in and out of it
• The network of lines within the PBX
• A console or switchboard for a human operator (optional)

If you use a PBX phone system within your company or organization, you can communicate both internally and with the outside world through different communication channels like Voice over IP (VoIP), Integrated Services Digital Network (ISDN) or analog.

By the way, Pinngle is a free cross-platform instant messaging and voice over IP (VoIP) mobile application that comes with numerous striking calling and messaging features that are of great significance both for individuals and businesses. Pinngle has recently launched its public channels, which can be of special importance for marketing efforts of companies. Moreover, now, you can have a virtual or international phone number through Pinngle and receive completely free calls. This is also important for companies and organizations all over the world.

Thanks to a PBX, you can have more phones than physical phone lines (PTSN). Moreover, you can make free calls between users. With a PBX, you can enjoy features like transfers, voicemail, call recording, interactive voice responses (IVRs), and automatic call distributor (ACD) call queues.

PBX Phone Systems. Types and Main Advantages.

PBX phone systems are of different types and have 2 main benefits for businesses that you can use to your advantage. These advantages include:

• Transferred Calls

Employees can transfer calls internally, setup an auto-attendant, or dial-by-name directory that enables callers to direct themselves to the right extension

• Shared Phone Lines

Employees can share just 10 phone lines

What about the different types of PBX? These are:

• Traditional Analog PBX

The technology of original PBX phone systems is landline-based. Their operation relies on a physical PBX hardware box. Traditional landline phone lines enter your office and get connected to a PBX box. Then, the phone lines are distributed to each office desk. Traditional PBXs are best for 50+ employees.

• IP PBX

Now, you can have an IP PBX phone system, which uses VoIP technology and IP networks like the Internet for call channeling. IP PBXs offer a wide range of features. These are best for 50+ employees.

• Hosted PBX

The operation of hosted PBX services is based on the cloud. The online companies providing these systems offer them against a monthly fee. The service is managed through the Internet. Hosted PBXs are generic and can’t be geared to your needs. However, they’re quite affordable and don’t require any upfront investment. Hosted PBXs are best for 5-50 employees.

• Virtual PBX

Virtual PBXs can be characterized as  “light” versions of hosted PBXs. The operation of a virtual PBX is similar to that of a hosted PBX, but, generally, comes with fewer features. It can be a good option for those who need a professional-sounding phone system quickly and affordably. However, a virtual PBX can be more expensive in the long-run.

PBX phone systems help businesses enjoy reduced costs. Of course, the exact savings depend on companies. However, with a PBX, you, as a business owner, don’t have to run a line from every phone in the building to the telephone company’s central office.

What’s the most important feature of a PBX phone system that would make you use it for your company? We’d love for you to share it with us in the comments below.