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The Future of On-Premise Telephone Systems
September 18, 2019

The Future of On-Premise Telephone Systems

The PBX is the grandad of the telecoms industry. Reliable, sturdy and the backbone of many businesses communications; the PBX is often referred to as an ‘on-premise’ telephone system, to differentiate it from cloud-based VoIP telephone systems.

The History of the PBX

Introduced in the 1960s, the PBX has ben steadily evolving for over half a century. PBX’s were originally made for large multi-national businesses. They took up large amounts of room and cost a fortune. However, over time the PBX adapted and improved as the technology became increasingly popular.

The PBX as we know it today is derived from the old switchboard style operators, where calls would be manually connected by a human. As PBX became smaller and more affordable, they included more and more features such as call recording, wallboards and more.

Nowadays, the PBX is a neat and complete little box that sits in your office, controlling all aspects of your telephony. These small PBX systems have long been the only way to reliably connect your business to the outside world.

However, things are changing.

The ‘PBX Killer’

The telecoms market is experiencing a large shift. This shift is turning people away from the traditional PBX, onto a new, more modern alternative: the cloud.

Cloud phone systems, often called ‘hosted phone systems’, ‘VoIP phone systems’ or ‘hosted PBXs’ are not dissimilar to the traditional on-premise PBX. They offer mostly the same features, they have the same purpose, and they often use the same handsets too.

These new VoIP phone systems sit in the cloud, and are accessed via a broadband connection, rather than telephone lines. The obvious benefit of this is that your business does not need to have an on-premise box-on-the-wall, therefore illuminating all of the associated costs.

PBX and VoIP diagram

The advent of cloud communications has lead many businesses to ditching their PBX systems in favour of an all-VoIP cloud solution. Across the UK, companies are moving to an all cloud environment, often saving lots of money in the process.

But what does VoIP mean for the PBX?

You’ll find lots of articles online about the ‘death’ of the PBX and how the cloud will rule the world one day. While there is no denying the clear decline in the popularity of the PBX telephone system; its demise is often grossly overstated.

In short: PBX’s aren’t going anywhere.

Does the on-premise PBX still have a place in 2019?

The PBX will always have its place, but that place is changing. Before the cloud, a PBX was the only way to connect your business to your customers - so it was dominant in the market place. But now, as the landscape changes, so does the role of the PBX.

We’ve supplied telecoms for over 30 years, and have witnessed these changed first hand. The main trend that we’ve found is that smaller businesses, typically those with under 20 extensions, will look to implement a cloud telephone system.

The PBX is still a great option, for businesses who require more control of their telecoms, or who want a more robust, stronger comms solution. It also does not require a good broadband connection (where cloud telephony does).

We found that bigger businesses are the ones who stick to a PBX. This is often for a number of reasons:

  1. They can use one centralised telephone system for all of their offices.
  2. They retain good control of their system, for features and fine-tuning.
  3. They make an enormous amount of calls that a cloud system would struggle to handle.
  4. They like that the system can be fixed by an engineer with a spanner; rather than a computer.

All of the above are great examples of why a business may wish to go with the PBX solution, rather than the cloud alternative.

What if your business has a PBX?

If your business has a PBX, that’s fine - you’ve no need to worry. PBX’s aren’t going to ‘die’ or become suddenly obsolete. In fact, we still recommend PBX solutions to certain businesses that we think would be best suited to them.

If you’re thinking that you’d like to upgrade your telephony, then that might be a good time to look into both cloud and on-premise telephone systems. By comparing the two, you can get a good idea of feature differences, costings and reliability. This will help you make the best decision for your business.

Our advice: Don’t just rush out and buy a VoIP phone system. Seriously. VoIP sounds all new and amazing, but consider which option is best for your business before you buy.

Our article might help you: How to Choose the Right Small Business Phone System

One last thing: The ISDN Switch Off

In 2018, Openreach announced that they are switching off the UK’s ISDN network in 2025. This so-called ‘ISDN Switch off’ is giving businesses an extra incentive to move over to VoIP as soon as they can.

Whilst there is no immediate rush, ISDN will be phased out sooner or later (whether they make the 2025 deadline remains to be seen). So, if your business is looking to change your telephone system, or if you’re wondering how you can save money, the upgrading to the cloud may be a good idea.

If you would like any more information about either cloud or on-premise telephony, please email us at or call us on 01934 882200.

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