Glossary · Phone system (PBX)
PBX
In one sentence
A PBX (private branch exchange) is a business's own telephone switch. It connects internal extensions to each other and to the public network, and runs features such as IVR menus, queues and voicemail.
Also known as : PBX · PBXs · IP PBX · IP-PBX · private branch exchange · phone system · phone systems
What is a PBX?
PBX stands for private branch exchange: a small telephone exchange that belongs to the business rather than to the phone company. It is what lets a receptionist put a caller through to extension 214, plays a recorded message when the office is closed and decides which line an outbound call goes out on.
Older PBXs were cabinets in a comms room, wired to every desk phone. Today most are IP PBXs: software running on a server, an appliance or a virtual machine (Asterisk, 3CX, FreePBX and many vendor platforms), with phones connected over the office network using VoIP. The next step, a cloud PBX, moves the software into a provider’s data centre.
How it works
- Registration: each desk phone, softphone or mobile app registers with the PBX using SIP credentials.
- Dial plan: the PBX applies rules. Three digits reach an internal extension; a number starting with 0 or 9 goes out to the carrier.
- External connection: to reach the public network, the PBX uses a SIP trunk, or gateways to legacy ISDN and analogue lines.
- Call handling: IVR menus, queues, ring groups, opening hours, voicemail and recording are all PBX features.
All of this is configured in an admin console. That flexibility is also the burden: someone has to maintain the system, apply security patches and watch for toll fraud, a well-known risk for PBXs exposed to the internet.
Example
A Dublin recruitment agency with 30 staff bought an on-site IP PBX in 2018. Over time, half the team started working from home two days a week, and every remote softphone needed VPN access to the office server. When the server’s support contract ended, the agency compared renewing hardware with moving to a hosted system. The deciding factor was not price but resilience: a fire alarm or power cut at the office no longer meant losing every phone line at once.
PBXs at Universal Telecom
If you are happy with your PBX, our SIP trunk connects it to the public network and lets you keep your numbers. If you would rather stop maintaining a server, our virtual PBX delivers the same features, extensions, IVR, queues and recording, hosted by us. Either way, our team can plan the move with you through the contact page.
Frequently asked questions
What is the difference between a PBX and a cloud PBX?
A traditional PBX is hardware or software you own and run, on site or in your own data centre. A cloud PBX is the same set of features run by a provider in its data centres; you rent it per user and manage it through a web portal.
Do I need a PBX for a small business?
You need PBX features as soon as more than one person answers calls: transfers, a greeting, out-of-hours handling, voicemail. For most small businesses those now come from a hosted system rather than a box on site.
Will my old PBX stop working when ISDN is switched off?
A PBX connected through ISDN or analogue lines needs a new connection once those lines are withdrawn. Many systems can take a SIP trunk directly or through a gateway; very old ones are usually replaced.
Related terms
- Cloud PBX
A cloud PBX is a business phone system run by a provider in its data centres. Extensions, IVR menus, queues and call routing are managed from a web portal, with no PBX hardware on site.
- SIP trunk
A SIP trunk is a voice-over-IP connection between a business phone system and a carrier. It replaces ISDN lines and carries calls and numbers over your internet connection.
- Extension
An extension is a short internal number, usually three or four digits, given to a user or device on a business phone system. Colleagues dial it to reach each other, and the system uses it to route calls.
- IVR (interactive voice response)
IVR (interactive voice response) is the automated phone menu that greets callers and routes them based on the keys they press, such as “press 1 for sales, press 2 for support”.
- VoIP
VoIP (voice over internet protocol) carries phone calls as packets of data over an IP network, such as the internet or an office LAN, instead of over the copper lines of the traditional phone network.
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