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What's the Meaning of PBX And How does a PBX system work?

A PBX is a Private Branch exchange, it handles the same functions as old-fashioned telephone operators, who once sat at large manual circuit boards, spoke with each caller to learn who they were trying to reach, and manually plugged wires into connectors to complete calls. Different PBX systems work in different ways, then the following will tell you what is a pbx and how does a pbx work.


PBX stands for Private Branch exchange, and has become a general term used to describe a business telephone system that offers multiple inbound and outbound lines, call routing, voicemail, and call management features. While many IT professionals are well-versed in networking technology, today, they must often also handle (or manage vendors who manage) the company PBX system. The following is a basic primer to give you a better understand of PBX systems.


"For two years running, mid-market and enterprise customers have ranked Mitel the 'Best Value' in the Eastern Management Group's annual PBX (premises and cloud) customer satisfaction research. Mitel's position this year is bolstered by another first-place ranking for the company, purchase experience, in Eastern Management Group's audit of satisfaction measurements. Thousands of IT manager customers participated in the review of 33 premises and cloud PBX companies." —NoJitter

What Is A PBX?

A PBX is a hardware system that handles routing and switching of calls between a business location and the telephone network. Originally, the PBX was not a thing but a switchboard operator; their name originates from the way they interact with the public switched telephone network (PSTN).

"Private" refers to the fact that they are separate from the PSTN, even though they can connect to it. "Branch" describes how a PBX fits into a PSTN: the main communication circuits are called trunk lines, and end points that connect to it and handle smaller amounts of traffic are called branches. "Exchange" refers to the fact that connections are exchanged through a switching system, allowing larger numbers of calls to be routed through a limited number of lines.

What Does A PBX Do?

It handles the same functions as old-fashioned telephone operators, who once sat at large manual circuit boards, spoke with each caller to learn who they were trying to reach, and manually plugged wires into connectors to complete calls. Modern systems are automated, incredibly speedy, and can do a great deal more than any manual operator.

A PBX also provides sophisticated calling features such as call waiting, auto-attendants, music/message on hold functions, and voice mail. Advanced features like find-me-follow-me are very useful for companies with highly mobile employees or sales forces, are also provided through a PBX.

What Are Key Systems? Are They The Same As A PBX?

No, the two are actually quite different. A key system is typically only useful for small businesses, with limited numbers of users (typically less than 50). A key system has telephones with multiple buttons ("keys") with lights that indicate which lines are in use , like you might expect to see on a receptionist’s desk. It is limited in function and feature set. Unlike users on a PBX, users on a key system typically do not have an assigned extension or Direct Inward Dial Number (DID) that rings only their phone. In fact, a common key system configuration is to setup incoming calls to "Ring All" (i.e. all incoming calls ring on all phones). It is also less common for key system users to have a private voicemail box.

How does a PBX system work?

There are three variations of a PBX phone system: analog, digital or cloud-hosted. An analogue PBX or landline system uses the public switched telephone network (PSTN), and these are becoming increasingly rare. A digital PBX uses the internet connection and bandwidth and can offer additional, more intelligent features for the modern business at a low cost. We explore the features of cloud-hosted PBX systems later in this post.

Different PBX systems work in different ways. For example, traditional PBX systems will use the old copper telephone landlines to connect inbound and outbound calls. In contrast, more modern systems may use VoIP telephony (voice over IP) or digital lines combined with the analogue lines. With a traditional or analogue PBX phone system, copper phone lines connect to the on-premises phone system, connecting to the PBX box within the office or business site. The PBX box then uses telephony switches to enable incoming calls to be directed to phones within the premises. Each phone within the premises will also connect to several outside lines (or trunk lines) via that PBX box.

An IP PBX system makes use of digital phone signals as opposed to analogue landlines. Updating to an IP phone means businesses can benefit from some more intuitive functions. While traditional PBX systems only have a certain number of internal extensions and outside trunk lines, with an IP business communications system, users can benefit from almost unlimited access in terms of adding extensions and trunks, making it a smarter choice for businesses looking for flexibility and scalability.

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