What’s PBX?

PBX stands for Private Branch Exchange. For years, it’s been the standard for many businesses. PBX systems allow businesses to use a central telephone landline for all of its employees.

Rather than each employee having their own line and phone number, each PBX user (or department) gets an extension off that central line for inbound calls, and they share several outbound lines.

PBX systems have several features you’re probably used to:

  • Free in-office calls to other extensions
  • Call-directing and -transferring options
  • Hold music or custom messages
  • Automatic Call Distribution (ACD) queues
  • Conferencing
  • Detailed records of inbound/outbound calls

Standards change, though, and in recent years, a superior telephone communications system has emerged.

What’s VoIP?

Voice over Internet Protocol, known as VoIP, is a newer way of making phone calls. Instead of traditional landlines, VoIP systems work over the internet. Everything about VoIP is digital, and that allows for more features that make VoIP better than traditional PBX in just about every way.

You can have VoIP one of two ways: on premises or cloud based. On-premises VoIP means all the hardware and networking is housed, managed and maintained at your place of business. Cloud VoIP—AKA Hosted VoIP (and, confusingly, Hosted PBX)—means that all the hardware and networking is hosted, managed and maintained by a 3rd-party service provider.

For the purposes of this post, we’re going to focus on Cloud VoIP, which provides all of the PBX features mentioned above and more.

How do PBX and Cloud VoIP measure up?

We mentioned that Cloud VoIP is better than PBX in just about every way, so how exactly do they differ? We’ve broken it all down for you here:

Standard features

Like PBX, Cloud VoIP has your standard offerings detailed above, but it also includes some other cool features like multi-device functionality, a virtual receptionist, presence information and instant messaging.

With PBX, these features cost extra, if they’re available at all (which they won’t be for older PBX systems). But with Cloud VoIP, it’s all standard.

Bring Your Own Device (BYOD)

BYOD allows users to bring their own personal device to use on the company network. BYOD in general boosts productivity, but with Cloud VoIP, it allows users to make and receive phone calls from their work number using any smartphone, tablet, laptop or SIP desktop phone. BYOD allows employees to take their work on the go and not miss a beat.

PBX, on the other hand, rarely allows for BYOD. If it does, you’ll likely need to purchase specific hardware and spend a good deal of time setting it up.


This one is open and shut. PBX requires its own infrastructure and setup, so you’ll have to purchase and install different pieces of hardware throughout the office.

With Cloud VoIP, you only need to purchase SIP desk phones to hook up to your existing network. Your service provider takes care of everything else.

Agility and scalability

Businesses continually grow, and sometimes they shrink, so it’s necessary for their technology to be able to do the same. Cloud VoIP allows businesses to add or remove as many users to their subscription whenever and as often as necessary. It’s just a matter of changing their service subscription.

PBX, however, is much more complicated to scale. Scaling up requires purchasing new hardware, upgrading the infrastructure, and more. Scaling back down from there is even more of a pain.

Software integration

Since Cloud VoIP works digitally over your internet connection, VoIP systems can be integrated with a variety of business applications like CRM, ERP and more to make life easier for everyone.

PBX systems offer no such integration. They run on their own, insulated network, disconnected from the internet.


Once again, it’s no contest here. Any maintenance with Cloud VoIP is on the service provider. Whether it’s hardware, service or network maintenance, your provider will make sure everything runs smoothly and fix it quickly when it doesn’t. That also means you don’t need a large, expensive IT department just to take care of your phone system.

On the other hand, PBX systems require expert IT attention on everything from system setup to regular maintenance to upgrading features and integrating new systems. This kind of expertise can get expensive very quick.


The only costs involved with Cloud VoIP are for the service subscription and any SIP phones you might need—though BYOD can make those desktop phones unnecessary for many businesses.

As you might have imagined, you have to buy everything for PBX systems: the (expensive) hardware, the setup, service, maintenance and energy costs— that’s all on the business to pay for.

On average, Cloud VoIP subscribers can expect to pay about $5 less per line than they would for a PBX system. So not only does Cloud VoIP have more and better features than PBX systems, Cloud VoIP is cheaper, too.

Who has the best Cloud VoIP service?

There you have it. Cloud VoIP beats PBX soundly in every fact. So whom do you turn to for the best Cloud VoIP service? To DigiFone, of course! DigiFone hosts the best Cloud VoIP service in the industry.

Not only do you get all of the features that Cloud VoIP offers above, but DigiFone service goes above and beyond with these additional features:

  • For our friends in the healthcare field, DigiFone is 100% HIPAA compliant with full encryption for voice-to-text transcription. Keep your patients’ PHI safe and secure.
  • DigiFone service is compatible with more types of SIP phones than other VoIP service providers are. You can use any handset you like, as long as it’s SIP-compatible.
  • We offer free on-site training for your staff, so they know how to use every feature from Day One.
  • View detailed call logs and review key call metrics with our in-depth call monitoring and tracking dashboard.

Whether you’re a small business, large corporation, non-profit or government organization, DigiFone Cloud VoIP can help you with all your phone system needs. If you’re thinking about making the switch to VoIP, get started with a consultation from our experts. Call DigiFone at
614-635-9676 or chat with our representatives online.