Hosted PBX Vs. SIP Trunking – Which Is Most Suitable For Your Business?

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It’s pretty clear to most businesses in this day and age that going for a VoIP (Voice over Internet Protocol) system is the smart choice to make. Compared to traditional telephone services, VoIP simply cannot be beat. The cost savings alone are enough to convince most companies, but, added to that the host of advanced features, the ability to scale at will, the increased reliability, accountability and uptime guarantees, and it’s really not hard to see why VoIP is the smart solution for smart companies.

 

But ‘VoIP’ itself is somewhat of an umbrella term. There are many ways in which a VoIP service can be implemented, and one of the most hotly debated standoffs that emerge from this field is that between hosted PBX and SIP Trunking.

 

Indeed, you may well find yourself struggling with this very decision right now, which is why we’ve put together this blog post to help you make the right choice. As descendants of VoIP, all calls with hosted PBX and SIP Trunking are placed over the internet, rather than the traditional copper wires of the PSTN (public switched telephone network). But they each involve a variety of different functions and features, some of which will be more beneficial to certain businesses than others.

 

So, firstly, let’s take a look at each service in isolation so we understand exactly what we’re dealing with.

 

What Is Hosted PBX?

Sometimes referred to as virtual PBX, IP centrex or IP PBX, hosted PBX (private branch exchange) is a telephone system that essentially provides classic telephone calling features without the need for any on-site equipment other than IP phones.

 

Hosted PBX always comes with the standard features that you would expect from a modern telephone system — call conferencing, do not disturb, call forwarding, music on hold, etc. But, in addition to the these, there are also many advanced features that can be very attractive to certain businesses.

 

Hosted PBX Advanced Features Include:

 

  • Find me follow me (FMFM): this is an advanced call forwarding feature, which enables calls to be forwarded to a number of different numbers so that calls are never missed.
  • Voicemail to email: automatically forwards any voicemails received to a user’s email inbox.
  • Virtual numbers: to save on long distance call charges, business can set up local contact numbers in any number of locations, which then get routed back to the main office.
  • Auto attendant: this allows the user to set up an automated greeting for callers, which will then direct them to any number of locations.
  • Group hunting: to ensure calls are always answered in the most punctual fashion, group hunting will make all phones ring until someone picks up. This is especially useful in sales and customer service departments.

 

Why Businesses Choose PBX Hosting

Since the PBX provider owns and maintains all the hardware involved with running a hosted PBX system, the startup costs are kept to an absolute minimum. In addition, the scalability that hosted PBX offers means that the system can grow with your business (provided it is on a relatively small scale (see below)). Businesses also benefit from having access to the full range of VoIP services as listed above.

Who Uses Hosted PBX?

 

Generally speaking, Hosted PBX is the ideal, inexpensive solution for the small business that is not expecting to grow significantly in the foreseeable future.

 

Bigger businesses, on the other hand, say with over 20-30 employees, will typically require a solution that is much more expandable.

 

What Is SIP Trunking?

 

Also known as IP Trunking, SIP Trunking creates an alternative to connecting to the PSTN. SIP Trunk users are able to continue to use their existing telephone system and equipment (i.e. the telephones themselves), but cost is significantly reduced by replacing the traditional trunk (i.e. the copper wires over the PSTN) with the internet.

Many businesses will of course already have PBX equipment in place, and so by simply adding SIP Trunking to this existing system, business communications are improved and costs are saved as both voice and data are carried on the same line, thusly eliminating the need for any additional lines that may be used to send faxes or access the internet.

One of the main advantages of using SIP Trunking is that it offers unlimited connectivity, even to remote locations.

However, what is slightly prohibitive with SIP Trunking is that some of the advanced features and functionality will be restricted to the PBX that is already in use by the business.

Why Businesses Choose SIP Trunking

Businesses choose SIP Trunking when they want to expand their telecommunications operations at scale. SIP Trunking offers all of the features that come with PBX, but efficiency and quality is significantly improved via the removal of primary interfaces. Huge cost savings are also incurred, mainly due to line pooling, which is simply the ability to share phone lines across multiple locations. Further cost efficiency is also engendered as audio and video are consolidated into a single line.

Who Uses SIP Trunking?

Generally speaking, it is the larger enterprise with over 20-30 employees who tends to use SIP trunking. This is simply because SIP Trunking offers greater scalability, flexibility and cost savings on a larger scale than hosted PBX.

 

So, Hosted PBX Vs. SIP Trunking — Which Is Most Suitable For Your Business?

The deciding factor when choosing between SIP Trunking and hosted PBX should be the size of the business. Smaller businesses will nearly always be better off with hosted PBX, as it provides all of the functionality of VoIP at little cost, both at the startup phase, and then later when it comes to maintaining the system. SIP Trunking, on the other hand, is better for larger businesses with more employees with existing PBX in place.

Indeed, before making the switch, businesses should take into consideration whether or not they already have PBX equipment. If so, then moving to SIP Trunking will be very easy to implement, and huge cost savings can be incurred straight away.

If the business is still relatively small, however, with no big plans to significantly expand in the foreseeable future, then hosted PBX will almost definitely be the right move, as it offers all the big functions and features of modern telephony at low cost.

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