What is a PBX and how does it work?

鈽庯笍 Learn in this article what is a PBX is, how it works and how it can help your company’s communications. 馃 Be sure to read this interesting article!

If you are looking for an effective communications system to manage calls in your company, you have to read this article. It will help you clarify all doubts, optimize costs and time resources of your employees.


What is a PBX?

PBX stands for “Private Branch Exchange” and is a type of phone system that uses software-based Voice over Internet Protocol (VoIP) technology to route calls from an Internet-connected device to standard telephone lines.

It allows users to make and receive calls from anywhere over the Internet, in addition to other features of a traditional phone system, such as extension dialing, call routing and voicemail.

It is a way to organize and manage the pbx phone system in a company by which users can establish communications without the need for traditional telephone lines or telephone lines at all.

Enterprise PBXs are used by large companies that need a system with more features than a normal office phone system. They can be used for voice communications, faxing, video conferencing and other telephony-related tasks.

Pbx phone system is often used for business, but can also be used privately:

  • Internal communications: to make internal calls between different departments free of charge through the extensions.
  • External communications: calls to everyone outside the office or company to customers, suppliers, etc.

They offer many benefits, such as low cost, easy integration with other services, and easy scalability.

We can refer to this communication system with countless terms, but in the end they all mean the same thing. We can refer to this communications system, using the following terms:

  • PBX
  • PBX Switchboard
  • PBX Exchange
  • Cloud PBX
  • VoIP PBX
  • IP-PBX
  • Virtual PBX
  • Hosted PBX

what is a pbx

It is an ideal solution for companies that need to provide telephone service to all their employees, but do not want to invest in hardware and infrastructure (it offers cost savings and flexibility). It’s also useful for people who want to make calls from home, but don’t have a traditional landline phone.

The main benefit of using a virtual PBX is its easy and cost-effective implementation. The cost of installation and operation is lower than that of traditional systems, which makes it an ideal solution for companies with tight budgets.


PBX, what is it for?

A PBX is used to manage incoming and outgoing calls from a telephone switchboard. It distributes to the different IP extensions of the same main contact number, or refers them to an operator with several telephone numbers.

It connects different devices to each other and allows them to make internal calls (for example, within a company) through the Internet network without the need to use the conventional telephone network and for free.

This system also allows you to make external calls using different channels such as VoIP, ISDN or even analog (it is compatible).

Additionally, it has features such as transfer calls, voicemail, call recording, interactive voice menus (IVRs) and call queues.

-> Now that you know what a PBX is and what it is for, keep reading to learn about its functions and advantages.


IP PBX, what are its functions?

We have already talked about some of the benefits of using IP PBX as a communication system, especially for companies.

The most notable advantages are undoubtedly that it allows you to connect different devices with each other and make internal calls for free without using the public telephone network, since these communications use the Internet network.

Even so, there are many other functions that a Virtual PBX can perform, which are detailed below:

– Provide a corporate telephone number with which to contact everyone in a company.

– Make multiple calls at the same time from the same Internet network.

– Optimal call management: call forwarding, transfers, conferences, queue management, etc.

– Automate call answering, according to a menu of options that the user can select to go to an extension or department in question.

– Distribute calls among company employees based on extension.

– Allow call personalization, as it is able to identify the caller when contacting.

– Make and record call recordings.

– Record complete data and statistics to analyze the telephone volume of a company.

The use of this system also allows companies to ensure that connections are made correctly.

These are generally the most common functions of conventional PBXs.

It should be noted that the PBX system is in continuous development, so we can find software that integrates other even more advanced functions.

In particular, in GESDITEL we have different communication customization packages for companies. According to the needs of each company we determine the essential functionalities in each case, but this is something that is carefully studied in each new project.


PBX, what are the components?

To install a PBX, are physical components necessary. We detail below everything you will need for installation and use:

– A box where the internal parts are stored.

– A PBX through which agents connect incoming and outgoing calls.

– Computers in charge of data processing.

– Lines connecting the PBX to the traditional telephone network.

– Cards for internal logic, switches, power cables and any other hardware devices necessary for the PBX to operate.

– Devices in the form of desk phones, fax machines, credit card terminals, etc.

– Power supply.

– Any necessary additional device capable of adding functionalities: voice mail, call groups, etc.

These that have been highlighted are generally the necessary components for the installation and establishment of communications of a PBX switchboard.


PBX exchanges, how do they work?

The PBX system software is installed on a server and the telephone line branching into extensions is configured for it.

These extensions are assigned to each user or area of 鈥嬧媡he company, allowing there to be a single header number and a menu available so that the caller can communicate directly with the desired extension.

The main phone line number is technically known as DID and is the parent of all extensions and the one displayed when making an outgoing call.

When you dial the DID number of a PBX, you will hear an automatic message that invites you to key in the extension or area number you wish to communicate with. This system is known as IVR and its main function is to receive all calls and distribute them to the requested extension.

An IVR speeds up customer service, since no one will hear a busy line when contacting, but will feel instantly attended to. In this way, agents’ time is optimized and, in turn, missed calls or cumbersome queues on the telephone line are avoided.


company pbx phone system


Company PBX phone system, what are the advantages?

– Connectivity and accessibility facilities:

The virtual PBX uses VoIP technology that performs communications over the Internet. In this case, any device connected to the network and a system for receiving and listening to sound (such as headphones) can act as a telephone terminal.

– Flexible and scalable system:

It is possible to increase or decrease the number of extensions very easily, and this will not increase the cost of the service.

– Greater functionality and fluidity of communications:

This switchboard system makes it possible to integrate value-added functions for the company into the telephone service and that provide agility to support services: calls in queue, dial groups, digital receptionist with IVR, virtual fax, etc.

– DID, a unique number for incoming calls:

It is more comfortable for a company’s customers to have a single contact number, which can be served by:

    • a digital receptionist,
    • a welcome speech to the company,
    • a physical receptionist
    • or a switchboard agent.

In this way, it will be requested through questions with which department or extension the client wants to communicate.

– Allows you to create different phone numbers for certain departments:

This switchboard system offers the possibility of establishing a direct call with the extension that is needed without going through the central number.

– Calls at 0 cost in internal calls of the company through the different extensions.

These are the advantages that a basic PBX software offers. There is software under development that offers advanced features and even more remarkable advantages for companies, everything depends on the needs of the company in each case.

We are sure that as soon as you start using this communication system, you will be able to find many more advantages!


VoIP PBX and Virtual PBX, what is the difference?

VoIP is a technology that allows voice communication over the Internet (without using traditional telephone lines)

The Virtual PBX , on the other hand, is a software platform that provides business telephone service over the Internet. It is the private switchboard that is hosted in the cloud and offers functions such as voicemail, call routing, call recording, conference calls, etc.

What is a Hosted PBX?

A Hosted PBX is also known as:

  • Cloud PBX (in the cloud),
  • Hosted,
  • or Virtual PBX.

It refers to the telephone switchboard whose server is not physically located in the company, but is hosted in the cloud, which reduces installation, maintenance and hardware costs.


Cloud PBX, what are the benefits?

– Savings in installation, maintenance and hardware: it is not necessary to make a large investment before installing a Telephone System in the cloud. Maintenance costs are much lower, since you do not need to contract maintenance in charge of system management or have the server physically in the company.


– Office available from anywhere in the world: employees can telecommute from anywhere with a virtual switchboard in the cloud. It is ideal for employees who travel a lot, such as salespeople or company managers.


– Optimizes the corporate image of the company: This virtual telephone system will ensure that customers are not left unattended when they contact the company. Waiting times for these users will also be speeded up and more personalized attention will be provided.


– User Friendly: For end users, a cloud PBX is easy to use and manage. There is no need for advanced knowledge or specialized skills so you can start using your new PBX right away.


– Scalability: the number of extensions that a company needs can be adapted very easily. You can increase the company’s extensions on the line at 0 cost.


– Easy to use: Because there is no end-user administration involved with a cloud PBX, it is easier to use than a traditional phone system.

pbx system


These are the main benefits that we can highlight regarding the implementation of a PBX switchboard system in the company, although surely as soon as you start using it, you will be able to find many more!


Cloud PBX and Local PBX, what is the difference?

There is no difference in the technology used for a cloud and a local PBX. What differs is the location of the PBX.

A Cloud PBX is hosted in the cloud by a third-party company that provides business phone service in its data centers to the company that owns the switchboard. Also, it uses Internet protocols to route calls, or requires hardware installation and can be accessed from any device.

A Local PBX is housed in the offices of the company that owns the switchboard. It cannot use Internet protocols to route calls, requires hardware installation, and can only be accessed by devices on your local network.

A cloud PBX generally provides more features and flexibility than a local PBX, but also has higher costs.

Cloud PBX and Local PBX, which one to choose for my company?

  • A Cloud PBX is the best option for small businesses where there are no concerns about the volume of calls or the size of the team in charge of communications.

Plus, you won’t have to worry about bulky hardware or the complexity of a physical system tying you down to your desk if you work in a small office or if your tasks aren’t 100% in-office.

It allows you to work freely from the comfort of the place you want; all you need is a laptop with a good internet connection. A third-party provider will take care of all data and operations and you will not be responsible for maintenance.

  • A Local PBX is the best option for companies that do not have a good internet network and need the reliability of the local telephone network that ensures the quality of communications.

It should be noted that these systems also require quite a bit of hardware, cabling, and maintenance work to function, so the costs are going to be much higher.


What is IVR?

IVR (Interactive Voice Response) -> In switchboards, it is the system in charge of distributing the calls of a telephone line between the areas or extensions of a company. We could define it as a digital receptionist.

Thanks to this system, the calls travel to the telephone device indicated by the caller and are answered by the agent in charge.

The IVR makes it possible to streamline the service to the public, preventing the caller from hearing a busy line when contacting, since they will be answered instantly. cumbersome queues for users.


phone system for business


If you want to know more about the IVR system, go to our blog where we have more articles to develop this topic.


What is DID?

DID stands for Direct Inward Dialing and is a virtual number that helps users anywhere in the world to communicate with your company without having to assume the costs of a long distance call.

It is the trunk number of the reference telephone line from which all the extensions of a company are branched to different agents or departments.

This functionality is very useful for companies that use the PBX system where the telephony and data provider assigns a certain group of numbers associated to the telephone lines.




So far everything you need to know about “What is a PBX” this phone system for businesses. We hope the article has been useful, has cleared your doubts about this system and encourage you to implement it in your company.

If you wish to contact GESDITEL to receive more information about this Virtual Switchboard service for companies or if you wish to contract it, you can contact us through our Contact Form.

At GESDITEL we help businesses and public and private companies to improve their communications and save costs. We study the specific situation of each company and prepare personalized budgets adapted to the needs of each one.

Let us take care of your communications so all you have to do is grow your business.

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Por: Nati CaballeroPublicado el: 26 de julio de 2022