Drawing the Line Between Hosted PBX and VoIP


 There is much confusion between Hosted PBX and VoIP. There are even some claims that the the Hosted PBX are VoIP phones system, but not all VoIP Phone systems are Hosted PBX. ​

To add to the perplexity of the matter at hand is the many names PBX has. First of all, it is an acronym for Private Business Exchange, but it also goes by the name of PABX or Private Automatic Branch Exchange; cloud-based PBX; Digital PBX phone system; Time Division Multiplexer (TDM); business VoIP, Hybrid PBX, cloud system PBX, and the classic: Traditional PBX.​

office telephone


Those are all mouthful, but VoIP it is only called that way and it goes by Voice Over Internet Protocol. That rollout of the tongue nicely. That one clear difference there.​

Now that we got that out of the way, we now go to where the line in the sand is drawn. For this purpose, we devised a (six) point of comparison like analysing a fingerprint from a crime scene, so to speak, and these are:​

  •  Scalability
  • Cost
  • Infrastructure
  • Ease of installation and maintenance
  • Features
  • Dependability​

​With these parameters now in place, here is where we draw the line in the between Hosted PBX and VoIP.​


Other key difference between Hosted PBX and VoIP, is the manner they are installed and how you can scale up. With Hosted PBX it is still a matter of having hardware, there is this ratio that you have to contend with, with every phone you need a port, a port is in a card when the card is full you will need a new cabinet.​

However, VoIP phone systems are license based. It all goes down to licensing. Every user, features, voicemail boxes, and others come with a license. Once the license is added the feature or extension is created.​


A hosted PBX system for your business in 2021, can cost your business something between $29 and $57 per line, this is according to priceithere.com. They claimed that the initial costs of hardware for a Hosted PBX is within the range of $950 to $3100, or morePricing will depend on how many new phones or other pieces of equipment will be installed and purchased.​

Meanwhile, the cost of VoIP is between $20 and $1,000. The provider you choose will dictate the price depending on the number of users, network enhancement, setup and it there is an option of one-time VoIP hardware cost. This is based on a 2021 pricing model. About the cost per month, a hosted VoIP system typically costs just $20 to 40 per user per month, according to the same source.​


For Hosted PBX phones they are using Category 3 cable or Cat3 or above wiring. It is a type of unshielded twisted pair (UTP) cable. This is typically used for voice and data communications in computer and telecommunication networks.​

woman on the phone

On the other hand, VoIP solutions require a Category 5 cable or Cat5. Sometimes it needed a higher cable for each device to operate. This type of cable that is used extensively in Ethernet connections in local networks, and telephony and other data transmissions. It utilizes a twisted pair design, rather than a coaxial cable or a fibre-optic cable design.​

Ease of installation and maintenance​

PBX system is a bit on the cumbersome side, said taylor.com. Because if remember the card or cabinet mentioned earlier? For every card and cabinet that the end-user needs the hosted PBX provider will have to go on-site to do the installation in the premise.​

As for VoIP, installation is manageable. All it needs IT, staff. An IT team must look into the Business VoIP System and make this their priority or to keep this in check, there is a provider that can do this for you.​


For this point, the PBX system is a bit underwhelming as it only provides enough functionality to the table to be productive under the business setting. But it does not mean it is short of having any features at all. Some PBX providers offer, Mobility & BYOD features with Switch Connect WorkTime Concierge feature, Contact Center, automatically move a call from the mobile-to-fixed phone, and even call recording.​

Not to be outshined, the VoIP system is packed with many facets there are even 45 VoIP features to look for from your business phone provider. There is even a provider that gives a snapshot of the whole Business VoIP System with its dashboard feature and even provide real-time performance data for better system analysis.​

 Dependability  ​

This is when force majeure comes into the picture. We are referring to natural disasters that the normal power grid needs to be turned off. This is a good dependable line of communication comes into play.​

When this happens, a PBX system is still pretty much operational as it doesn’t reliant on electricity to operate. With this, you can still operate and even use this system to call for help or extend one, if needed.​

For the VoIP, it needs electricity to run, in case a disaster and having an operation power grid is not an option, this system is knocked out for now.​

Note that this dependability clause only touches the worst-case scenario like a natural disaster, like wildfire, flood, earthquake and other calamities.  Depending on the extent of the of the damage, some telephony may still work. This is all in the spirit of hoping for the best, preparing for the worst. ​

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