Hosted PBX

What is Hosted PBX Phone Systems – Easy Complete Guide

Hosted PBX, or Private Branch Exchange, is a vital piece of technology for businesses of all sizes. But what is it? And more importantly, why do you need it? Read on to learn more about PBX and how it can benefit your business.

Many people are not aware that there is such a thing as Private Branch Exchanges, which can be described as telephone systems possessed and deployed by one company. There are two kinds of PBX:

1. Hosted PBX:


Hosted PBX you can make your employees call from the web browser or an app. This is because it’s accessed over a network in the cloud, which is a special type of memory that stores information and sends data across networks without getting lost along the way!

The flexibility of a hosted PBX is unparalleled. Your employees can work remotely and use their business phone numbers from any location, instead of calling from an office landline.

When considering hosted PBX solutions, there is a lot to consider. Let’s get started!

  • What Is the Process of Using a Hosted PBX?
  • How does a hosted and on-premise PBX differ?
  • Should I go with a hosted PBX?
  • How does a hosted PBX function?
  • The Advantages of a Hosted PBX Phone System
  • How to Select a Hosted PBXs Service Provider

2. Cloud PBX:

The case for installing a cloud PBX service for your business is quite strong, specifically this year. An IP phone system that’s managed offsite and maintained by the company you select will save your company from expensive infrastructure needs and any software or training expenses! Plus you can benefit from quick deployment of these systems without additional configuration. These systems are easy to install and fulfil the requirements of a large and small staff. Even if there are only two people on staff who need new phones now (which would be amazing). And since everything about this PBX happens online – there is minimum maintenance required.

Difference Between Hosted And On-Premises PBX:

What is the distinction between hosted and on-premises PBX?

The primary distinction between a hosted PBX and an on-premises PBX is that a hosted PBX does not need extra infrastructure and software to complete on-site phone calls. Both kinds of PBXs have perks and setbacks. The technical distinction is in the call data transmission method.

On-Premises PBX

  • Reduced cost per seat.
  • There will be no internet access.
  • Simple calling functions.
  • You must be present in the office to make calls. Costs for routine maintenance, such as full-time workers to handle the system.
  • You’re in charge of the hardware.

Hosted PBX

  • Online setup takes only a few minutes.
  • Usage of network bandwidth is kept to a minimum.
  • No maintenance is required.
  • Can carry out call recording, re-routing, and forwarding from any gadget, at any period of time.
  • Support from multiple data centers equals 99.999 per cent uptime.
  • Training and assistance are provided.

The traditional, on-premises PBX is not only difficult and expensive to manage but also requires more staff. With that said those who work in IT may have the right skills needed for such an environment because it can be very technical work involving telecoms knowledge as well Voice over IP (VOIP) technology itself!

In order to foster innovation, we should remove barriers. This is easier said than done! The challenge comes from managing these types of systems especially when there are upgrades or changes needed which could potentially disrupt business if done incorrectly so much in favor for the entrepreneur – but with some planning and forethought this can be avoided altogether.

There are lots of reasons to consider an IP PBX, not just because you want the flexibility or security that comes with working remotely. You might also be interested in making calls over Skype while traveling outside your office-the sky’s really no limit when it comes down this type phone system!

A traditional on premise switch can only connect one line at any given time; if working from home periodically is important for employees then there isn’t much point investing into such high cost equipment (onpremises). Interim options include upgrading straight onto internet telephony using digital Voice Over Internet Protocol(VoIP) phones which allow conversations alongside regular analog models within same household.

The internet has changed the way we communicate. It’s now possible to work from home or fully remote on occasion, but if you want that option for your company then there is no way an on-premises PBX will suffice anymore because it only works at one location which means certain calls may get missed when they should go through – like conference calls between employees who are all Idea Falls CT area code 1742 numbers! An IP phone system allows people working remotely as well even though their location isn’t necessarily close by; still these professionals need access too communication tools.

Of course, the more “modern” option that will give you access to full digital phone experience, is to switch to a hosted PBX.

But, a plain PBX might be preferable if you have a non-existent IT budget and don’t have any plans to expand your office phone service. This isn’t a dig against PBXs; instead, they are very reliable if nothing changes and the business needs don’t change.

PBX Failures? Here’s How To Fix Common Issues

A hosted PBX shifts your phone and communications infrastructure over to a trusted VoIP provider. Instead of individual phone extensions, each phone is replaced with a VoIP desk phone.

1. Hosted PBX - Network Topology Illustration

With the implementation of the hosted PBX, your voice communications use the existing data network. Business broadband can easily support the unified communications needs of the entire office. All the top PBX features like call routing, call recording, and conferencing are provided from the VoIP service.

Instead of using a proprietary phone with your PBX, hosted platforms let you use any SIP phone for the greatest compatibility. Calls are established securely over the same network your computers use.

The information that travels over IP networks to the cloud PBX, which reaches scalable data centers. Those servers route calls to other VoIP providers, including the publicly switched telephone known as a PSTN.

To manage how your calls are handled, including advanced call features, you just need to access an online voice portal in your browser to adjust your settings. Once you click save, the changes are applied in an instant.

This process works the same for small businesses as it does for larger offices—just plug your phones in and get back to work.

There are two types of hosted PBX phone systems. Let’s compare them to see how they benefit companies like yours.

2. Should I Switch To A Hosted PBX Phone System?

You should consider switching to a hosted PBX system if your company is in a growth period where you expect to regularly add phone numbers or phone lines. Another major reason to switch to a hosted PBX system is if your employees are working from home or are full remote employees. A hosted PBX system means that all your business phone numbers exist in the cloud and can be accessed from devices anywhere with the internet.

A hosted PBX system requires less  upkeep and maintenance than an on-premises PBX system.

Being in charge of an on-premises private branch exchange can be a full-time job. That means a company might spend a salary on someone whose entire job is to understand the system inside and out, and continuously stay on top of changes, updates, and patches. This makes for a stiff challenge when you consider how much it costs to keep someone on staff.

PayScale estimates the median salary for a telecom manager with PBX skills is $82,340 with the market topping out at $121,000.

The Benefits Of Hosted PBX:

There are many reasons why businesses switch from an on-premises PBX to host their business phone system in the cloud.

When comparing the two, you’ll notice that hosted PBX offers a wealth of features. That’s because there are dozens of VoIP features to implement.

At a glance, here are just a few of the top reasons why people switch to hosted PBX:

1. Business phone numbers that can fully support remote employees:

One of the reasons why a hosted PBX is a top choice for many small and growing businesses is the flexibility employees have to work remotely. Voice over Internet Protocol lets employees use an app and immediately have their calls forward to any phone number or device. Whether they want a call to go directly to their cell phone or their laptop, VoIP makes it happen anywhere in the world.

What’s needed to make this happen? Simple: a VoIP service provider and a reliable internet connection. With those two factors coming together, hosted PBX can accomplish something the traditional PBX never could.

2. Fast Setup with Minimal Maintenance

Another critical factor is the ease of set up and how easy the system is to maintain. Unlike traditional PBXs, hosted PBX can be set up within a few days, sometimes even the same day. Because the implementation requires no on-site infrastructure, which makes the entire solution easier to maintain.

You’ll remember that with the traditional PBX, it was sometimes necessary for a business to hire a full-time employee that was trained on the system and could make any significant changes or troubleshoot problems. Hosted PBX takes that need away, saving companies a hefty amount in their IT budget.

3. Flexibility & customization on demand

With Hosted PBX, a business can change its call settings in a flash. The same way an employee can log in and easily route their phone number to a new device. Cloud-based PBXs make accessing features like call forwarding, conference lines, Caller ID, and Voicemail to SMS as easy as toggling a setting on or off.

A middleman is often needed to update PBX features. Businesses had to call telecom providers to implement the options they wanted (usually at an additional cost). A hosted PBX has put the power of flexibility and total call control in the hands of the user.

4. Enterprise-grade Reliability & Performance

For businesses, increased reliability is arguably the most crucial benefit.

Hosted PBX, since it’s not a physical landline or housed in an on-site phone system that can have a whole lot of problems, from the building’s wiring to downed telecom lines. With built-in redundancies like failover, interconnected data centers, businesses can find ways to ensure they’re always up and running.

Even in the event of inclement weather that requires evacuation, you can configure your VoIP phone system for remote employees, to alert customers with timely messaging, forward calls to voicemail, or even route them to cell phones. It’s possible because a hosted PBX operates across multiple redundant servers located across North America.

5. How to Choose the Right Hosted PBX Provider

Not all cloud PBX providers are the same. Selecting the service provider makes a massive difference in achieving the goals in your business. Before implementing a hosted PBX solution, we recommend deciding on the most important features to your organization.

Cloud system buyers should establish their business requirements, compare VoIP features, research security protocols, and examine service and support offerings.

Choose a hosted PBX provider that covers the following factors:

  • Initial and recurring phone service costs
  • Capabilities of the business phone system
  • Price, availability, and quality of support
  • Third-party reports on uptime and system reliability
  • Security best practices and certifications like PCI, SOC, and HIPAA
  • Number of data centers and its security profile
  • Accessibility and ease of use of the unified communications platform
  • Verified customer reviews and industry benchmarks

When you score your hosted PBX service, you will see that Nextiva consistently ranks as the best business phone service in the industry. Why? Nextiva is easy to use, offers unrivaled reliability, and the support team is legendary.


The workplace has changed a lot in 20 years, let alone the last five. The pandemic forced us to work exclusively from home and many businesses moved to hosted PBX solutions so their employees could continue to receive calls and work remotely. Those still on a PBX (like hotels that have a phone in each room) are usually doing so because they paid a ton upfront for the equipment and software licenses, and may still be paying off the loan. It’s a fact that work has fundamentally shifted from structured offices to ones that embrace more flexibility. It’s time for your business phone system to keep up with the change.

Business owners and IT administrators share universal respect for products and services that just work. Gone are the days of tinkering with an old Windows server with outdated PBX software to save a few dollars. This is a classic case of tripping over dollars to pick up pennies.

The modern office will continue to shift towards using less hardware. Softphones will replace desk phones as the new standard. Call centers will continue to upgrade their ageing PBXs with a modern hosted PBX that connects their agents around the world using nothing more than an internet connection.


Zayne Z

Meet Zayne VoIP Blog's dedicated Content Researcher with 5+ Years Experience. Passionate about VoIP technology, he delivers accurate, engaging articles, keeping readers informed on industry trends with excellence.