What is VoIP? What is Hosted PBX?

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What is VoIP?

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What is VoIP?

So, you may have heard people talking about VOIP or Hosted PBX, but what does it all mean?

Well, very simply, hosted telephony works in the same way as a traditional phone system but without expensive hardware or the need for any hard wiring. In fact, it uses an internet connection for the lines and the main system is put in a cloud. The calls are made using VoIP (Voice over IP). This means the system can be changed instantly, as the “hardware” is now on the internet rather than on a telephone pole.

The fact that a system is not static and does not require any hard wiring like traditional phone systems means the possibilities are endless. The system can grow with businesses  without any disruption. It also allows businesses that operate from multiple sites to link up better. Or, businesses that have lots of people working from home can plug their phone into a router and be on the office switchboard.

We can add and remove lines (channels) in minutes giving your business complete flexibility. The system offers businesses of all sizes features that were once the preserve of large organisations that had systems which cost tens of thousands of pounds. We add to the system all the time so if there is something you would like that is not on our system tell us. If we think it will be useful we will make it for you.

Tecnical Details

So, you’re here to get the nitty gritty technical details on hosted PBX.

You’re in luck! We love the geeky stuff and our experts here enjoy getting their teeth stuck into a good technical guide.

Hosted PBX

So firstly, let’s start with the PBX part of hosted PBX. PBX stands for Private Branch Exchange which is a term used to describe business phone systems.

Business phone systems offer enhanced features compared to residential and mobile phone systems because a business needs more from it’s phone system to function.

These features can include conference call facilities, hold music, extension numbers, queues and a range of others that if you’re reading this you’re probably more than familiar with. 

The Cloud

The Hosted part of PBX means the system is held in the cloud. Traditionally, PBX systems were held in onsite computer servers which are expensive, take up space, and require someone with technical knowledge to set them up. That’s why until hosted PBX came about these advanced business phoneline features were mainly the preserve of very large companies.

That’s all changed now, as we can host data on virtual clouds. We’re sure you know, but it’s worth mentioning that being “in the cloud” has nothing to do with the sky. It simply means a group of servers which are hosted in a data centre, and not actually onsite. These large groups of server’s host data from lots of different companies and locations, meaning their capacity is shared out. The technical knowledge, space, and maintenance is shared out among different customers and so it opens up opportunities to companies who wouldn’t invest in their own advanced computing facilities but can afford to share them with others.

Okay, so we’ve gathered that hosted PBX is a phone system which is powered by specialist equipment which is hosted off site (i.e. not in a room down the hall in your office). But what’s all this talk about VoIP phones about?]


Voice over IP (VoIP) is term used to describe making phone calls using the internet. Instead of breaking down sound into binary code (computer language) and shooting it down a phone line that’s strung between buildings it shoots it down an internet cable instead. Then the speaker at the end of your phone decodes the binary and projects the sound of someone speaking.

So, why is the internet cheaper than phone lines? It’s using a technology you’re already paying for. So rather than buying new phone lines for an analog traditional system you use the internet which you already have installed.

Also, there isn’t as much manpower required, so you aren’t paying for engineer time to come and install a line just for you. The engineer time is shared across all the companies using the equipment. Finally, it’s a culture issue, internet phone calls are cheaper because the companies who sell the calls generally charge less than analog phone system providers. We’re not completely sure why, but we fully support it, we want you to get the best deal possible!

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