What is PBX?

PBX means a private branch exchange. First, we need to understand what exchange is. In a Telecom network, a switching system is located on a premise. The premise is the exchange or telephone exchange. Your PSTN phone line connects to the switching system. This is a public branch exchange, as anyone with a phone connection can connect to the switching center and own it by a mobile network operator.

A PBX is an exchange inside personal property owned by a company or an individual. It uses the same technologies as public exchange uses. A PBX connects to the switching center using a trunk. The TDM trunk can allow multiple calls simultaneously.

A private branch exchange enables multiple phones to access the same trunk by different phones inside the premises. Each phone is allocated an extension number that is local to the company. There is a common public phone line to connect PSTN. Many phone users can use the same trunk.

What are PBX Functions?

In an office, PBX connects phones internally as regular phones. This enables free calls among the people sitting inside an office. An office may be at a single location or at multiple. With VOIP, multiple offices connect over SIP trunking to make free calls.

It provides the queuing of incoming calls. This is very important for a call center not to disconnect the call if all agents are busy.

It plays the voice message to the caller and can collect inputs as DTMF digits so that the caller can reach the correct person in a call center.

A call can be transferred to another extension without losing an incoming call.

It provides statistics, which helps in getting a customer base for more revenue and boosting the sale of the product or service.

It provides the option to share a phone line among multiple callers.

Intelligent call handling.

Call recording.

What is Analog PBX?

Traditional phone lines that connect to the public switching centers are analog. At a single time, only data or voice can work on a phone connection. You might use a dial-up connection for the internet. During internet browsing, if someone calls on the landline number, he gets a busy tone. As technology advances, digital or ISDN phone lines are introduced. ISDN can carry voice and data simultaneously, and the internet speed can be much faster than analog lines.   A physical splitter is used for phone and internet router devices. Analog or digital lines connect to a phone system using E1/T1 TDM cards. Each E1 slot has 31 channels. Few can be used for signaling, and remaining for actual voice.

An analog or digital line system is an analog or digital PBX. There is a dedicated phone line from PBX to the telecom network switching center. When the location changes, the network operator needs to update the configuration and set up a new phone line to the new location. The main issue is capacity. If concurrent calls increase, there will be a requirement for more additional E1/T1 lines, which may add more time and cost.


As telecom is growing rapidly and new technologies are emerging. VoIP or Voice over IP is the new and most popular method of communication. A VoIP system can have voice and media sessions over an IP network. With VoIP, a PBX can connect to the public telephone exchange over an IP network. It provides a flexible calling capacity. No need to upgrade any physical wire if the number of concurrent calls increases. It uses SIP trunking, which provides the required signaling to set up VoIP calls. It is inexpensive compared to the analog similar system, as it does not require additional analog or digital cards. Most of the cost is software only cost.

Hosted PBX:

Now with cloud and data centers, many companies sell software as a service. PBX is one of those services, and it is called Hosted PBX. This was only possible after VoIP. A company can choose the hosted option, where there is no need to invest in initial hardware or software. Just buy the required functionality from a service company that has set up PBX in the cloud or data center.

PBX providers:


Here is the list of hosted PBX providers.

How to Setup PBX?

Suppose you want to set up your system. VoIP is a good ch ce.  First, you can get the SIP trunking connection from a service provider. Install the Asterisk and set up a dialing plan and extensions.

What is IP-enabled PBX?

This looks similar to the IP PBX, but there is a difference. The IP-enabled PBX should have TDM along with an IP connection ty.  The internal phones may be connected over IP, and the connection with the public switching center is over transitional TDM lines.