PBX, PABX, Hybrid PBX/PABX, & IP PBX Systems: Similarities, Differences, & Benefits

In the past, conventional business phones (also called the plain old telephone system or POTS) were only able to accommodate one user at a time.

If your colleague has to take a call, you’ll need to physically pass them the handset. If they need to complete a huge volume of calls, they would need a personal number or no other calls would be able to come through. What’s more, if the business operates in several locations, you would need a new connection and a new number, even if the branch was in the same city.

This antiquated system prevented managers from knowing who received the call and deprived them insight into what was discussed. When looking into expanding in multiple locations and the business owner wants a phone in each location, they also first need to determine whether there’s an available terminal in each location to connect the phones to.

The arrival of Private Branch Exchange (PBX) systems has changed the way businesses handle calls, as they eliminate most physical limitations present in old telephone systems.

What is PBX

PBX refers to the internal network of phones that connect to telephone trunks as a group instead of individually. The system behind traditional PBX is actually very old. It used to involve switchboards, manned by a live operator who manually plugs wires to complete the circuit and connect the calls to the recipient.

Although a PBX has changed how businesses take calls, it still posed certain challenges. For one, users are constrained to a particular number of outside calls (trunks) and internal phones (extensions). PBX users also share the outside lines for making external calls.

The traditional PBX system (which required an operator to work) has become obsolete as the electronic switching system was introduced. To make the distinction between the manual (human-operated) and automatic (electronic switch-operated) systems, the term private automatic branch exchange (PABX) was created.

What Is IP PBX?

The advent of the Internet led telecommunications experts to integrate Internet protocol to PBX. As the name suggests, Internet Protocol Private Branch Exchange (IP PBX) enhances the traditional telephone switchboard by using Internet connectivity to link calls between:

  • Traditional telephone users
  • A traditional telephone number and a Voice over Internet Protocol (VoIP) line
  • Local or internal VoIP lines

You can upgrade an existing PBX system into IP PBX by integrating session initiation protocols or SIP trunks. SIP trunking enables VoIP in IP PBX: the technology is responsible for starting and terminating conversations between two or more users in an IP network. These real-time calls can be audio-only or video conference calls.

SIP trunks can connect multiple phone numbers into a PBX, allowing various members of your company to use one external number when making outbound calls. The interconnected lines are an advantage for B2B transactions as it streamlines communications with suppliers and partners. SIP trunking also allows you to make long-distance and international phone calls through the Internet, which can significantly reduce your monthly phone bill.

Besides the cost savings on telecommunication hardware installations and service charges, IP PBX systems offer other benefits to small and large businesses:

  • Scalability – IP PBX runs on computer software, which is easy to configure according to your enterprise’s needs.
  • Flexibility – Administrators or developers can add software-based features to boost your OP PBX functions. Examples of these features are voice mail and an automated attendant.
  • Mobility – IP PBX extensions can be moved anywhere in your office, eliminating the need to re-patch and re-wire telephone lines. You can even use your mobile phone to make calls using your extension, thanks to SIP software protocol.

What is PABX

The automatic switching systems have significantly improved how PBX operated. While PABX systems do not entirely eliminate the need for human action, they lessen the need for live operators as they automatically connect the calls. Operators only become necessary manually connect or supply information to callers who may be unfamiliar with the organization they’re calling.

Electronic switching allowed PABX systems to integrate features that were unavailable in manual systems, such as voicemail, call waiting, call conferencing, automatic ringback, and internet connectivity.

PABX systems also perform all the switching necessary to make internal calls within organizations and connect extensions and external phone lines. Large organizations such as contact centers benefit from PABX, as this system allows for a single access number to open several lines for access callers while providing external lines for the staff and internal callers.

PBX and PABX are often used interchangeably, because they perform the same function. The only difference is, PABX is just a new term coined to describe PBX’s newly enriched capabilities.


If you already have an existing PBX infrastructure, can you upgrade it to include cloud functionality? The answer is yes. You can combine both solutions to come up with a “Hybrid PBX,” or a “Hybrid-Hosted PBX.”

A hybrid PBX is a system that takes existing legacy equipment and uses it with Voice over Internet Protocol (VoIP) to deliver more advanced capabilities and greater flexibility. It integrates the same convenient features provided by VoIP services such as auto-attendant and call rules. This system also allows videoconferences, fax over IP, and virtual conference rooms.

A hybrid PBX provides the best of both worlds. Hybrid PBX, for example, allows SIP trunking. This means you can connect two or two dozen channels to your PBX/PABX, so you can make local, long-distance, and international calls over the internet. If either the legacy PBX phones or the VoIP server works, hybrid PBX automatically switches over to the other network, so your operations do not get disrupted.

The truth is, making the switch from a traditional business phone to a PBX or hybrid system isn’t exactly cheap. But PBX and Hybrid PBX solutions pay for themselves in the long run. You’ll find that a POTS line can be more expensive to maintain. As calls get transferred multiple times between several different locations, and using various devices with POTS, users tend to pay more for long-distance and international calls.

One of the biggest benefits you can reap from a hybrid PBX is having to dodge long-distance charges, as calls get routed from one office to the other through the hybrid PBX system itself. In addition, if you operate in a temporary location, you can bypass the building’s telephone lines and instead simply use cordless phones to directly connect to the hybrid PBX.

PBX vs PABX: What You Should Know

Is there really a difference between PBX and PABX systems?

The presence of the word automatic is what sets PBX and PABX apart. During the earlier days, PBX was simply a room where switchboard operators connected calls by manually plugging wires to a call circuit. As technology continued to evolve, innovations in communication technologies occurred — one of these is electronic switching. Automation entered the scene.

The introduction of this new communication tool meant that PBX needed a newer term, so it evolved from PBX to PABX.

What a PBX/PABX System Can Do for your Business

The unique capabilities of PBX take this system from a simple communication platform to a machine that prompts new business processes and streamlines operations. Here are some things a PBX/PABX system can do for your business:

  1. Switch between departments and users without dropping the call.
  2. Aid workforce management and increase productivity rates by providing historical data through features like call recording.
  3. Set up a customer care center to address the concerns of customers from different locations.
  4. Greet prospective customers and business partners with a customized pre–recorded message. You can even choose the appropriate music as they wait to be connected.
  5. Manage and transfer calls according to your specific schedule. If you’ll be out of the office in the afternoon, for example, you may have the calls forwarded to your mobile number, so you don’t miss any important calls.
  6. If you operate in multiple remote locations, you may expand your hosted PBX to accommodate the size and requirements of your business. This also works for startups and smaller companies that depend on the gig economy.

Today’s workforce is always on the move, and modern business phone systems are adapting to cater to their needs. Switching from a traditional business line to a PBX system can help teams adapt to increasing demands and fast turnover rates as well as cater to customer concerns despite geographic challenges.

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