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How Business VoIP and Cloud PBX Differ

December 27, 2011
By Jamie Epstein, Business VoIP Web Editor

As different types of technology are constantly introduced to the market, it is easy to get confused about what solutions have certain capabilities and features. To help break it down, this article will detail the key differentiators between business VoIP and Cloud PBX.


Business VoIP utilizes voice over IP technologies that allow calls to be made over an IP network such as the Internet rather than a traditional PSTN. VoIP phone systems are typically used by small to medium sized businesses (SMBs) and offer users a cost-effective way to make and receive calls, while simultaneously gaining access to multiple features that seamlessly integrate with the company’s resources over the Internet.

Outdated phone systems required circuits to be switched by PBX equipment and phone lines to be connected to the Public Switched Telephone Network (PSTN). However with business VoIP, the system can quickly convert the signal digitally and sends it by voice data packets through an Internet Protocol (IP). In addition, VoIP can also utilize the PSTN which enables calls to be connected to l land lines, according to a recent piece.

VoIP technology is extremely important as it combines voice and data into one unified network. This helps to dramatically increase mobility, as the system can be accessed wherever an internet connection is available.

Some features typically associated with business VoIP are advanced call forwarding and electronic messaging, auto-attendant, three-way conferencing, Advanced Call Distribution (ACD), call routing and more.

On the other hand, Cloud PBX is a phone service that is connected via the internet, and the phone service provider is required to maintain and manage the overall cloud PBX system.

Cloud PBX boasts many capabilities that go above and beyond what a conventional telephone system can offer such as caller ID, voicemail and call routing.

A huge reason to implement a Cloud PBX solution in your business is the increased scalability it offers. “It is enough if you initially buy the base system and add extensions and features as your business grows. With normal telephone systems it is necessary to pay more or install additional wiring to add another phone line, but this is not the case with a Cloud PBX system,” the article revealed.

Cloud PBXs also enhance mobility, as they work no matter where you are and can call a mobile phone directly.

Moreover, there are several different types of Cloud PBX systems including Public Cloud PBX, Private Cloud PBX, and Hybrid Cloud PBX. Each of these Cloud PBX systems rely on business VoIP technology to work successfully.

If you haven’t already begun to leverage these technologies, now is most definitely the time.


Jamie Epstein is a business-voip Web Editor. Previously she interned at News 12 Long Island as a reporter's assistant. After working as an administrative assistant for a year, she joined TMC as a Web editor for business-voip. Jamie grew up on the North Shore of Long Island and holds a bachelor's degree in mass communication with a concentration in broadcasting from Five Towns College. To read more of her articles, please visit her columnist page.

Edited by Carrie Schmelkin

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