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Hosted PBX Basics

Hosted PBX telephone systems provide your business with the latest features and equipment, for a fraction of the purchase price of traditional PBX systems. The main advantage of getting a hosted PBX system as opposed to purchasing your own system, is that you will not have to purchase any hardware or software for the system. In other words, your business will save money on up-front setup costs and support costs. With a hosted PBX system, your business will always have the latest phone equipment without incurring capital depreciation costs. Your only ongoing expense will be the monthly service fee that you will negotiate with your vendor.

In addition to enjoying advanced features like advanced call routing (to any phone), distributed administration capabilities and better call capacity handling, hosted PBX systems enable your business to scale more effectively. With a hosted PBX system, your business will be able to tap into the latest call features as your business grows. Additionally, hosted PBX systems provide a high level of fault tolerance, making for a more robust telephone infrastructure at a relatively low cost.

Hosted PBX systems do have some drawbacks. With a hosted system you will not be able to have real-time system monitoring, true automatic call distribution (instead of simply hunt groups) or easy extension dialing. All of these drawbacks stem from the fact that the PBX system is hosted offsite. However, most businesses find that the cost savings associated with a hosted PBX system often offset these drawbacks. Additionally, hosted systems are not limited to a specific number of lines or concurrent calls, whereas in-house PBX systems are. With traditional PBX systems, if you are operating under normal call capacity, you may be wasting money on extra capacity; if your call volume is over your normal capacity, you will lose customers to busy signals. Hosted PBX systems completely eliminate the need to worry about capacity, since hosted systems flex to your business demands; ultimately, you pay only for what you use.

Other Hosted PBX terminology:

  • Software PBX: Another term used to describe a hosted PBX telephone system.
  • IP or VoIP PBX: A PBX system running on a VoIP network.
  • Hosted VoIP PBX: A hosted PBX system that is running on a voice over internet.
  • protocol (VoIP) system: Calls can be routed to IP telephones anywhere in the world.

Points to consider:

  • How many phone lines do you need?
  • What is your purchasing timeframe?
  • Do you have multiple locations/offices?
  • If you are interested in a VoIP hosted PBX system, how fast is your internet connection?
  • Is it fast enough to handle your peak call volume?
  • How many employees will be using the hosted PBX system?
  • What additional features do you require? (such as auto-attendant, ACD, multi-party conferencing, etc.)

Leading suppliers:

Related articles - December 2008

- Hosted PBX or Virtual PBX
The Hosted PBX Wikipedia page – read about basics, trends and the future of PBX. (Source: Wikipedia)
  Hosted PBX versus PBX On-Premises: Pros and Cons
An article discussion the pros and cons of regular vs. hosted PBX solutions. (Source: VoIP News)
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  Virtual PBX: Dialing for Dollars
An article that highlights some of the advantages of a hosted PBX system. (Source: Small Business Computing.com)
  Toll Free Virtual PBX Systems Level the Playing Field for Small Businesses
An article about how virtual PBX is leveling the playing field for small businesses. (Source: PowerHomeBiz.com)
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  The Year of the Hosted PBX ... Eventually
A short article exploring how hosted PBX systems are applied across a full range of business sizes. (Source: XChange)
   

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