Q

How is VoIP different from a virtual PBX?

Telephony expert Jon Arnold explains how VoIP and virtual PBX are different, but related.

Is VoIP different from a virtual PBX?

The correct answer is they are different, but related. In short, Voice over Internet Protocol (VoIP) refers to the technology and standards that allow phone calls to be made over a data network. These days, VoIP is broadly used in reference to the telephony services offered by all kinds of operators as a replacement for legacy telephony service. So, VoIP can be used to describe both the underlying technology as well as the service that businesses pay for on a monthly basis to provide telephony for their employees.

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Either definition of VoIP is separate from virtual PBX, which raises a broader issue of how language creates unnecessary confusion for first-time VoIP buyers. You likely know what a PBX is, along with its VoIP-friendly upgrade the IP PBX. These are hardware-based switched telephony systems that are widely used by businesses. They are generally feature-rich but fairly expensive and beyond the reach of many small and medium-sized businesses (SMBs).

The best way to address that is with some form of a hosted VoIP service, where the business doesn't have to worry about managing the service or buying an expensive phone system. At a high level, the term hosted is often used interchangeably with both cloud and virtual, which brings us to this particular question.

There are important differences among these terms but, essentially, they all describe a service where most of your telephony is outsourced to a VoIP provider. In other words, the service -- a platform, really -- is hosted offsite, making it virtual in simple terms. The basic idea is that you just pay a monthly cost per subscriber and, in many cases, you can keep using whatever phones you have now.

This brings us back to how VoIP is related. Any provider offering a hosted, cloud or virtual PBX is doing so on the basis of you using their VoIP service, either completely or in tandem with time-division multiplexing. The key here is that VoIP has a lot more flexibility than a legacy service. For a provider, it has the ability to offer a software-based virtual service that can work on your desk phone, your PC and even your mobile phones. For SMBs with limited capital or IT expertise, these offerings are a great way to start a transition from legacy telephony to VoIP.

Learn more about virtual PBX:

  • Virtual PBX lets small businesses act big: Learn how virtual PBX gives SMBs telephony services without breaking the bank.
  • The benefits and drawbacks of virtual PBX: Virtual PBX is not for everyone. Learn what you should consider before choosing a hosted service.
This was first published in May 2014

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