Why NOT to Buy a New PBX

For decades, the standard answer to a failing business phone system or one that had run out of capacity was to install a new PBX in a process known as a “fork lift upgrade.” A new PBX is something like a new car. You get higher performance, greater reliability and more capacity. So now that you are in the market for a shiny new PBX or IP PBX, the best one to buy may be none at all.

What? You mean hang on to that old junker that’s almost impossible to keep running? No, not at all. Don’t go out and spend a thousand dollars or much more on yet another PBX box. Instead, look at a hosted PBX solution.

Hosted PBX, also called Hosted VoIP or PBX in the cloud, is a service rather than a product. You simply remove your old PBX and don’t put anything in its place.

Oh, then what do the phones plug into?

The phones will plug into your computer network. Nearly every company has a LAN with Ethernet jacks for each desk and office. You are used to having two separate networks in your company. One for the telephones and one for the computers. A hosted solution is based on a converged voice and data network, which is the Ethernet LAN that you have now. Larger companies have long ago converged their voice and data networks to take advantage of enterprise VoIP solutions. Small and medium size businesses can do the same. What’s important in a converged network is that voice packets have priority over data packets so that phone call quality is maintained regardless of the load on the network.

Clearly, you can’t just plug your old telephones into the LAN. The connectors are different sizes. That’s for good reason. Standard analog telephone equipment is completely incompatible with computer networking standards. There are two ways to resolve this. Either put network adaptors on each phone or replace the phones with newer IP phones that already have standard network interface cards built-in. You’ll probably want to use IP phones because they support more features over the network.

What do the phone lines connect to? There won’t be any outside lines connecting to your building like there are now. In other words, no analog business lines and no ISDN PRI. All the outside lines are connected to the hosted PBX at the service provider. You connect to that service provider using a line called a SIP Trunk. This can be a T1 line or Ethernet over Copper configured for SIP Trunking service.

I should mention that SIP Trunking can be setup to support your current analog telephones and wiring directly. In this case, the provider installs a piece of equipment called an IAD or Integrated Access Device. The IAD splits the SIP Trunk into telephone lines and broadband Internet service. In other words, it supports the two separate networks that you have now.

The whole reason you installed a PBX in the first place was to gain control of your internal calls and manage the sharing of multiple outside lines. The hosted PBX does the same thing from afar. Your internal calls stay on the network so that you don’t pay for office to office calls. Outside calls connect to the public telephone network at the cloud service provider.

A hosted PBX does some tricks that your old PBX doesn’t. You can have offices in many different cities all on the same phone system. You can also have local phone numbers in cities where you have customers but no physical office. Callers may dial a local number in Bangor, Maine and you’ll answer it in Phoenix, Arizona.

A major advantage of hosted telephone services is that you don’t have to come up with large amounts of capital to purchase a PBX system nor hire the staff to maintain it. That’s all handled for you by the service provider. They buy a much larger PBX system and have the staff available around the clock to maintain it and handle any problems that arise. You pay by the month for service, which often includes unlimited local and national calling plus a wealth of features to make office operations efficient. Some providers even include the IP phones in your service plan.

Are you getting ready for a telephone system upgrade? Don’t go out for a bank loan yet. Instead, get a quote for cloud hosted PBX telephone service and see if paying by the seat per month rather than making a big investment makes more sense for your business.