VoIP vs PBX: How to Choose the Right Phone System for Your Business


VoIP vs PBX: How to Choose the Right Phone System for Your Business

If you had to select between a VoIP phone system and a PBX phone system for your business, how would you know which one would suit your specific business needs?

While both solutions provide all of the business phone system functionalities, there are significant differences in subscription costs, technical skills, and maintenance requirements.

In this article, we'll go through the pros and cons of VoIP vs PBX systems, as well as their integration feasibility, benefits analysis, and more.

What is PBX?

business phone systems providers

Private Branch Exchange (PBX)

Businesses and enterprises that need multiple phone lines for their operations use PBX phone system hardware to host their phone systems locally.

A PBX system switches calls between users on several local phone lines while authorizing all users to share a single external phone line. In the initial days, businesses installed local PBX phone systems to reduce the subscription cost of multiple telephone lines for each user.

The traditional PBX systems were analog, however, modern systems use digital signals that are converted to analog signals once they leave the local system.

What is a VoIP Phone system?

Voice over Internet Protocol (VoIP)

VoIP phone systems use the Internet rather than physical switches to route calls. VoIP technology switches the analog voice signals into digital packets which are then transmitted to the recipient caller via the internet.

The VoIP phone system is used to communicate with users who use either IP or traditional business phone systems. It has become a popular choice for customers and businesses alike. The VoIP phone system market is expected to quadruple in the next 3 years.

What considerations should you make while choosing between VoIP and PBX?

While both PBX and VoIP providers offer all the features you need from a business phone solution, different facets must be taken into consideration while choosing either VoIP or PBX.


Initial Investment

Installing a hosted PBX is a large operation that requires a high upfront cost. With the requirement for a constant power supply, costly routers, protocol gateways, configuration software, and key hardware such as telephones and headsets, the initial setup cost could exhaust a business's technology budget. Businesses that are growth-centric must invest more in deploying IP phones with VoIP so that they can transform their telecommunication platform at a low cost.


Scaling up with PBX is difficult. Every time a company has to hire a new agent, it must add new phone lines and allied communication technologies. It becomes much more difficult if the company intends to relocate its office space. They will have to install a brand new PBX phone system, incurring additional setup charges.

VoIP phone systems, on the other hand, require a license. When you add a license to the system, it automatically manages the system's features, existing and new users, voicemail boxes, and so on. Scaling a VoIP service is also simple and hassle-free. If your company wants to upgrade to a higher VoIP plan or acquire extra phones and add new customers, it can be done with only a few clicks. Even if it is necessary to upgrade the existing phones and routers, this will not be an issue. It is possible to use the same VoIP plan.

Size Limitations

Traditional PBX phone systems have a limit on the total number of phone numbers and lines. When you add more lines, you need to expand the server space and hardware, which raises the business costs. Furthermore, calls can only be routed through direct devices within the system, restricting the flexibility of call possibilities.

Only bandwidth limits the maximum count of numbers and users in VoIP. Adding and removing users is simple, and the charge amount is updated accordingly. Businesses can use many local and international phone numbers on the same system.

Call Quality

The call quality of a PBX business phone system is determined by the hardware — routers and phone models. Because the calls are routed through landlines, it is critical to ensure that the phone system is appropriately configured for high-quality calls.

While the sound quality of VoIP phone systems is primarily dependent on a good internet connection, the deployment of fiber optic lines will eradicate any call quality difficulties.

Reliability and Security

When correctly installed, a PBX phone system is highly reliable and secure. The PBX systems are adequately protected from hackers because they rely on a classic PSTN (Public switched telephone network) over an internet connection.

Furthermore, power outages will not be a problem with traditional PBX phones. Because the phones are not powered by electricity, they will continue to function even if the power goes out. However, hardware failure is a significant element to consider. In the event of an internal problem, the entire PBX phone system will require technical adjustments, resulting in downtime.

Meanwhile, because VoIP technology is powered by electricity, expect your system to shut down if there is a power outage. Furthermore, because the technology is dependent on an internet connection, any drop in speed will have a substantial influence on call quality.

While VoIP providers are always improving their technology to make it as secure as possible, it is also up to your organization's security protocols to avoid hackers or breach attempts. It is mandatory to use safe passwords, call encryption, and a solid firewall.

PBX vs VoIP – IT Responsibility

PBX phone systems necessitate sophisticated IT knowledge. Experts will be required for both the initial installation and ongoing maintenance. Hiring an external team only for the process of adding extra lines to update new features to the existing system can be costly and time-consuming unless you have people with prior experience with the PBX phone systems.

One of the primary advantages of VoIP over PBX is that it does not require an external IT team to maintain. Depending on the size of your organization, you may just need one person to build and maintain this system. Your service provider will resolve any service or troubleshooting difficulties for you. During the first purchase of VoIP phone systems, most suppliers will also include knowledge base documents or tutorials to make onboarding easier for your users.

Team Mobility

To connect their phone systems, hosted PBX systems require an internal data network. Outside of the office network environment, official phone systems will be ineffective. With the advent of COVID-19, the businesses fast-realized that hosted PBX were not portable.

With VoIP phone systems, you may handle calls from your desktop and laptop computers, as well as your mobile phones. Service providers include native apps in their packages for iOS, Android, and Windows. This allows your customer support and sales personnel to handle calls outside of the office, allowing them to work remotely to maintain business continuity.

Another advantage of VoIP phone systems over traditional PBX phone systems is that they are far less expensive. They also have adaptable structures that can be increased or reduced without incurring additional costs.

Customization Options

Customization of PBX phone systems is possible, however, there is a limitation as it requires special tools and expertise which is both time-consuming and expensive. Furthermore, as the customization evolves from time to time, the PBX system's maintenance cost rises substantially.

VoIP plans can be easily customized without requiring any hardware adjustments. Through their online dashboard, users may quickly manage the required parameters. Most of the features ranging from voicemails to managing call queues are easy to set up and user-friendly.

Types of PBX Phone Systems – Which one you should pick for your business?

Traditional PBX Systems

At the business's physical location or locations, a traditional hosted PBX phone system is installed. The calls are forwarded through a regular service provider. This implies that even if there is a power outage, your company may continue to make calls and maintain contact.

Although the initial investment is pricey, overall monthly costs will be lower. If your business has a dedicated IT team to keep servers online, a traditional PBX phone system is also a wise investment. The technician will be reachable if something goes wrong. The best part is that the in-house professionals can advise you on the best connection speed at your specific business location where the PBX is primarily set up.

IP PBX System

An IP PBX commonly referred to as a Voice IP (VoIP) PBX system, leverages the currently available internet access. Similar to a regular PBX, setting up the network requires a hefty initial cost. However, choosing VoIP services enables you to lower the cost while gaining additional services and features.

In addition to offering call reliability and superior sound quality, an IP PBX is also easier to maintain. While IP PBX systems are constrained by the company's internet bandwidth, traditional PBX phone systems are limited by the number of phone lines within their communication infrastructure.

Additionally, each call uses a small amount of space because the call data is truncated into digital packets. Businesses that want complete control over the internal configuration of their PBX and do not want to pay the subscription costs associated with other PBX choices may choose an IP PBX.

You can unlock the full power of your on-site VoIP PBX system by using SIP trunks. Sophisticated call routing and call accounting are among the prominent features of the VoIP phone system.

Hybrid PBX System

A hybrid phone system combines digital PBX and VoIP technology to provide a fusion of approaches for connecting to external phone numbers. Due to its on-site installation and ability to connect remote offices to the phone system, this form of PBX is simpler to manage. SIP trunks are supported by the majority of hybrid PBX systems, which results in excellent voice quality.

The hybrid PBX phone system is best suited for businesses whose phone service cannot be completely dependent on the internet or whose employees spend most of their time stationary. If the majority of your workforce is office based then the Hybrid PBX system could be the most suitable option.

Cloud-based PBX System

Virtual PBX, another name for a cloud-based PBX phone system, offers all PBX apps, system capabilities, and calling services in the cloud. The network infrastructure is created by an Internet connection, appropriate call management software, and a web application. A single monthly invoice covers the full bundle. Your telecom provider will provide warranty service, software updates, and PBX maintenance.

The most economical choice is a cloud-based PBX phone system, and some of its most beneficial features are:

  • Superior calling features
  • Advanced data recovery
  • Budget-friendly pricing
  • Highly flexible & scalable
  • Intra-office networking
  • Easier system management

One of the most important choices a business must make is choosing its phone infrastructure, so if you're seeking to enhance your company's phone system, look no further! Your search for a cutting-edge business phone system is over thanks to a dedicated cloud communication platform supported by Trikon!

Recent Post

  • Trikon

    Trikon and Velocity Frequent Flyer


  • Trikon

    Why the NBN is good for business?


  • Trikon

    An Official Great Place to Work® Certified company!


  • Trikon

    Factors to Consider While Choosing Hosted PBX Provider


  • Trikon

    The Comprehensive Guide To VoIP Phone Systems


  • Trikon

    Benefits of Cloud-Based Communications in eCommerce Business


  • Trikon

    VoIP vs PBX: How to Choose the Right Phone System for Your Business


  • Trikon

    Common Mistakes to Avoid When Choosing a Business VoIP Service


  • Trikon

    5G and small businesses in Australia


  • Trikon

    5G and the new era of Blockchain and NFT's


  • Trikon

    The Significance of 5G in a Metaverse Universe


  • Trikon

    Why does your business need a website?


  • Trikon

    Trikon 5G is the perfect internet solution for Australian smart homes


  • Trikon

    5G is not just another 'G'


  • Trikon

    How can Australian businesses bounce back from the pandemic pandemonium


  • Trikon

    Map of the new digital Australia


  • Trikon

    Jump start business communication with hosted phone system


  • Trikon

    6 tips to optimise & setup office internet


  • Trikon

    Covid-19: not a pandemic for businesses


  • Trikon

    Data usage & estimates


  • Trikon

    SIP trunking: future of VoIP & streaming media


  • Trikon

    Things you need to know about 5g


  • Trikon

    The future is cloud communications


  • Trikon

    How to shift from ISDN to SIP lines, its value & utilities?


  • Trikon

    Future ready small business phones systems & why you should shift to them


  • Trikon

    How can managed printing help my business?


  • Trikon

    Cloud phone vs old pbx systems


  • Trikon

    Don’t lose on your small business connectivity



Quick contact


Quick contact

Unbeatable Deals

Grab your phone and talk to us NOW!

Be part of something

Join us and reinvent your career by collaborating with
world class teams and extraordinary individuals.