Virtual PBX

Standard PBX vs. Virtual PBX

The term PBX stands for Private Branch Exchange. A PBX is a phone switch that connects business telephones with the telephone network. The principal role of any PBX is to route incoming calls to specific extensions in an office, and to provide access to outside lines for individual PBX users. Over time, the number of PBX-based features has expanded far beyond this.

Standard hardware based PBXs can be expensive in both installation and continuing maintenance costs, with a prices ranging from $500 to $2000 per user for equipment, installation, and wiring. Basic features of a standard PBX include:

• Unique-number access to all employees and departments.
• Ability to publicize one number for full company access.
• Custom greeting to received calls.
• Music or message for callers on hold
• Voicemail
• Call transfer between extensions.
• Conference calls among multiple extensions.
• PBX usage data are available to management on demand, for efficiency and personnel analysis.

Virtual PBX provides these same services and features, but without the need for on-site hardwired equipment. Instead of buying equipment, customers contract for service with a PBX hosted service provider.  Because the cost to the host for adding features makes those features available to all customers, many more features are available, at a much lower price.  This rarely imposes any need for the hardware additions to the customer’s site. The service provider owns equipment and customers have shared access to the PBX.

Virtual PBX:  Pros

Virtual PBXs are available from many providers, and offer several advantages over standard PBX:

Call routing to any phone

This can be a significant benefit for companies that have virtual offices or employees that don’t commute to the main office. Incoming calls can route to a home line, wireless phone, or any other number, with messages sent by telephone or e-mail.

Start-up costs

The price of on-site PBXs can be prohibitive to even moderately sized clients.  Initial costs from $10,000 to $100,000 on a new PBX and its accompanying maintenance are difficult to absorb.  Virtual PBX customers avoid these costs, and pay only for the service.

Ease of management

Whether the new owner enters a maintenance agreement, or crosses his fingers and hopes to avoid emergency repair costs, the expense of using a hardwired PBX can be high.  Similarly, upgrading an on-site system almost always calls for purchase and installation of new circuitry or equipment.  Ownership increases per-employee costs for a growing company. Finally, users of Virtual PBX avoid the expense of dedicated personnel to manage and run it.

Scalability

For customers of Virtual PBX, scaling their service up or down is a simple matter of changing the number of lines crossing the demarc.  Hardwired PBX can only handle as many calls as the on-site hardware allows. Virtual PBX allows telephone efficiency to be determined by hiring choices instead of hardware.

Virtual PBX: Cons

Compared with hardwired PBX, Virtual PBXs lack some important features.  Since Virtual PBX customers own no hardware, they forgo the advantages that private ownership provides. Automatic Call Distribution (ACD), call transfers, and real-time monitoring are technically impracticable on Virtual PBXs. This is because the PBX provider intercepts incoming calls, and then forwards them to the customer’s extensions.  The following table summarizes some key comparisons.