A Hosted PBX is a virtual telephone system where, instead of having all your telephone hardware in the office, your hardware is provided by a system hosting company and you connect to the system via a network connection. The diagram below shows the configuration of a hosted PBX telephone system and how it makes effective use of Voice Over IP (VOIP).

PBX Background

PBX (Public Branch eXchange) refers to telephone switchboard hardware that routes calls from the main public telephone network to extensions within an organisation. For many years PBX systems have been installed in offices to manage incoming calls and these switching systms have become ever more sophisticated as telephone technology advances.

Traditionally the PBX hardware has had to be onsite at the office, usually in a cabinet in the IT room or tucked away in a cupboard or storeroom in the office building, with the improvement in Voice Over IP (VOIP) technology the PBX hardware no longer has to be onsite and can be 'hosted' by a service provider, in a similar way to the way webhosting is provided by Internet Service Providers (ISPs).

The PBX system provides a wide range of facilities apart from just routing calls, for example call queueing, transfering a call to a different extension when the phone isn't answered, voicemail and faxes. These facilities are all available with hosted PBX services in the same way, many companies even provide a web interface to allow you to manage your own network services.

For more information see our Advantages of Hosted PBX Systems and Disadvantages sections.