What You Need to Know About Hosted IP PBX
The landline business telephone is soon to become a technological relic. And the hardware behind it – on-premise private branch exchange (PBX) technology – is slowly but surely being replaced by a more scalable, flexible, and cost-effective alternative.
That alternative is hosted IP PBX: a business phone system that’s owned and managed by your service provider and accessible via almost any internet-enabled device. This technology isn’t just for startups and small businesses. It’s an ideal solution for almost any business. Even large enterprises are choosing this cloud-based business phone alternative. Why? There are several reasons, but cost, scalability, the opportunity to access more features, and the ability to customize the experience are the main ones.
The latest sign of the decline of on-prem PBX technology comes as Avaya, a major PBX hardware provider, filed for Chapter 11 bankruptcy protection on January 19th, 2017. The market for PBX hardware is shrinking. Revenues were down by 5% in 2014, while revenues for internet-enabled telecom solutions rose by 20% according to IHS.
So, in light of this fast-growing technology, there’s no time like the present to learn more about it, how it works, and who it’s for.
What is hosted IP PBX?
Hosted IP PBX is a powerful phone system that is owned, operated, and maintained by your telecom service provider. It works over Voice-over-IP (VoIP) technology rather than traditional phone lines. That means your call data is transferred over the internet, not over the public switched telephone network (PTSN). It also means that you don’t have to store and maintain physical PBX infrastructure at your office.
This connectivity model opens the door to many opportunities that weren’t available with a traditional on-prem PBX.
For one, if you have a hosted IP PBX set up, you can work with full functionality from anywhere in the world. You can use any internet-connected device (including a cellphone) to connect to your office phone system and even access all your extra features like call transferring, call holding, conference calling, auto attendant, and more.
Second, because a hosted IP PBX system runs over the internet, you don’t necessarily have to replace your existing PBX system. In fact, the two systems can run in parallel. This is a big advantage if you’ve recently invested in PBX hardware, but want to eventually migrate to a hosted IP PBX. You can protect your initial investment while trialling a hosted solution to see if it works for you.
Finally, because the hardware is owned and maintained by your provider, you can significantly reduce your internal IT requirements. Hardware installations, upgrades, maintenance, and complex administrative tasks become worries of the past. With a hosted IP PBX solution, you can administer your system using intuitive on-demand software. And when you need to add more lines or locations, you just have to call your provider and get it set up in 1-2 days instead of 1-2 months, which is the typical on-prem PBX set up time.
How does hosted IP PBX work?
It’s really simple. Your telecom service provider holds all the hardware required to run your PBX system at their premises. That means you don’t need an internal team of experts to maintain it. Your provider will also supply the software required to administer and operate the system. You can use desktop computers, laptops, cell phones, tablets, and most desktop phones to make calls. And, if you want, you can get IP desk phones designed specifically for business VoIP calling.
All these devices are connected to your provider’s servers via your office network and the internet, and managed with a single software interface. So any device you can connect to your network (even over Wi-Fi) can access your hosted IP PBX system and therefore be used to make phone calls.
Who is hosted IP PBX for?
Hosted IP PBX is ideal for small and medium-sized companies who want a sophisticated, feature-rich telephone system without investing in new telecom equipment. Generally, it’s ideal for companies with 10 or more employees. For companies with under 10 employees, a virtual IP PBX system is usually a better fit. It’ll have less features than hosted IP PBX, but will be more cost-effective for a small team.
Usually a virtual IP PBX comes with some basic call answering automation features, while a hosted IP PBX is a complete business phone system, with many more enterprise-level features like call forwarding, auto attendant, conference calling, and voicemail to email.
Companies with multiple locations (especially across multiple states) will see the most benefits from switching to hosted IP PBX. This is because it allows you to run all of your phones under a single, centralized system, drastically reducing your telecom resource requirements. This will let you scale without any additional investments, adding more and more lines as your location footprint grows. You benefit from the economies of scale your provider achieves by managing business phone systems for several companies under one roof. And you’re free to focus on what’s most important for the growth of your business.
Hosted IP PBX is also an ideal phone solution for fast-growing startups. Imagine being able to open a ‘virtual office’, with a real local number in a major city like New York. You can instantly boost the credibility of your company without having to invest in real estate. But that’s not the only benefit for startups.
A hosted IP PBX system makes it easy to give your company the appearance of a much larger organization. One way to do this is to use an auto attendant, a virtual assistant that takes all your calls and routes them based on your customers’ needs. This way, you can give all your customers, no matter where they’re calling from, the same user experience.
It’s also important to note that there’s no limit to the number of lines and locations you can support. Hosted IP PBX providers won’t put a ceiling on your success. So you can stick with the same technology solution as you grow.
Best of all, hosted IP PBX is quick and easy to set up.