For years, Private Branch Exchange (PBX) was the industry standard for describing business telephone systems, but is the term now obsolete?

We would definitely say yes; however, the number of people still inquiring about IP PBX, VoIP PBX, and Cloud PBX proves there is still some confusion.

Essentially, PBX is a legacy term used to describe a business-grade phone system designed to share lines and route calls. Nowadays we use terms like IP, VoIP, or hosted to describe exactly the same thing, so the PBX tag is no longer needed.

That being said, it is valuable to understand the history of PBX and its role in the evolution of today’s robust technologies.

PBX in the Beginning

The term PBX was penned in the early ‘70s to describe systems which were made up of “trunks”, or phone lines, and “stations”, or desk phones. A PBX system made it faster, easier, and less expensive for businesses to handle both external and internal call volume.

A PBX could be considered the “mother” of the modern day telephone system with humble beginnings in the early 1900s as privately-owned switchboard systems manned by operators in charge of routing interoffice calls.  For businesses who couldn’t yet afford their own PBX equipment—which took a lot of space and money—dedicated blocks of switchboards could be rented from public telephone companies to manage their internal calls. These packages were sold as Centrex Service, short for Central Office Exchange Service – another commonly recognizable term.

The Evolution of PBX

Fast forward to the mid-1990s with the advent of Internet Protocol (IP PBX) which paved the way for VoIP technologies (the transmission of voice signals as data over an internet connection). This revolutionized business telephone systems with enhanced features and functionality grouped under the term Unified Communications (UC) which includes softphones, mobile integration, instant messaging, video calling, and Presence technology.

Is There a Difference Between PBX and VoIP?

VoIP ushered in the era of Cloud hosting – using a secure Internet connection and a provider’s Cloud technology to host the “brains” of a telephone system, thus eliminating the need for large hardware investments.

With Cloud hosting, businesses can now save on costs but still enjoy a fully-featured telephone system. A “hosted PBX” is essentially just a hosted VoIP system. The PBX descriptor is simply not needed.

Get the Right Telecom System for Your Business

If you’re in the market for a new business telephone system, we recommend inquiring about VoIP and hosted phone systems – there’s no need to use the term PBX in your search.  Better yet, contact the experts at Sunco and let our team take the guesswork out of finding a new on-premise or hosted phone solution that will work best for your business!

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