Wednesday, July 12, 2006

We Don't Need No Stinking PBX

Once a business grows beyond a few telephone lines, the common practice is to install a PBX or Private Branch Exchange system. The PBX is small single-purpose computer that manages interconnecting phones in-house and connecting them to outside lines as needed. The big cost savings of a PBX system is based on not having to pay per minute for any calls that stay within the company, even between remote locations, and making the most efficient use of expensive outside lines on a shared basis. Well, that's the sales pitch anyway.

PBX systems are an endangered species for larger companies and make no sense at all for smaller and virtual companies. Why? It's the cost thing. The same cost savings pitch that created the demand for PBX systems is now their undoing. Take in-house phone line switching for instance. It's based on having dedicated telephone wiring from the PBX system to each telephone. But what if you get rid of the phone wiring?

No phone wiring? How can that be?

The new cost savings paradigm comes from having a single set of network wiring that serves both computers and telephones. In fact, the same network that already serves the computers can also be connected to the telephones. One network, perhaps with some upgrades, one set of wires. This is the VoIP or Voice over Internet Protocol approach to telephony.

Another cost savings comes from having one set of technical support people handling both the phones and computers. PBX systems need their own specialized team. Each time a phone is moved, the PBX system needs to be reprogrammed because it associates telephones with the lines they are plugged into. VoIP phones are network equipment like computers. They have their own identifying addresses that are recognized regardless of where they are plugged-in on the network.

Yet another cost savings comes from what is called "toll bypass." Instead of paying a toll to use the phone company's network for long distance calls, you use your own network or a third party network that may be cheaper. Calls that leave your network may be connected to the phone company at more advantageous rates near the outside location.

To manage phone services on an enterprise network, you'll need some specialized equipment that takes the place of the PBX system. These controllers go by various names including IP PBX or Soft Switch. In addition to the switching equipment, you'll need telephones that connect directly to your network. To see whether this approach is cost effective for your company, you'll want to get competitive quotes for PBX vs Enterprise VoIP.

Another approach is the "virtual office" system which gives you the flexibility of a PBX style phone system without the headaches of having to manage an in-house phone system. With a virtual office, the switching equipment and connection to outside phone lines is handled by a service company such as Packet8. All you need are the specialized phones and network adaptors for each location and a broadband Internet connection.

The real beauty of the virtual office comes with the "virtual" part. Your office can be 3 or 30 people at 3 or 30 different locations. The network doesn't care where the phones are physically located. Only their unique addresses and that they can communicate over the Internet. Members of the virtual office can be sitting cheek to jowl or they can be scattered around the country or even around the world. Regardless, you can easily forward, park or conference calls, access voice mail, and even have one person act as a switchboard operator if you wish. People calling your virtual company think they are connecting to a big office location with a sophisticated PBX system. No need to burst their bubble. Only you need to realize that you wouldn't know a PBX if it came up and bit you in the wallet.

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