What is a PBX (private branch exchange)? The difference from a business phone is explained in an easy-to-understand manner. We will thoroughly explain PBX functions, IP type / cloud type differences, merits, and how to select the best PBX for your company!

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What are PBX (Private Branch Exchange) Benefits?

About PBX (private branch exchange)

PBX is a private branch eXchanger installed in the company, that is, a telephone exchange.

If you call the main phone number on the company’s homepage or company registration information, most will connect to this PBX first.

In addition, the main functions are to be transferred to each extension telephone number from here, or to make an outside call from each extension telephone.

Digital PBXs that digitally process voice signals are the mainstream, but recently, IP-PBXs that have been converted to IP and integrated with local area networks (LANs) have also evolved into cloud PBXs that use the cloud.

Explains the role of PBX and what it can do.

Control outgoing / incoming calls from outside lines

what is pbx
PBX has a function to connect the incoming external line to the internal line and a function to connect each telephone to the external line, but it also has the following additional functions to control outgoing and incoming calls.

Incoming call control

There is a dial-in function that allows incoming calls to be received by phone number, not by phone line. A contracted line telephone number is used as a parent number, and another number that shares the same line is added as a child number. This is a function that can be directly applied to a specific extension number from the outside. As a direct phone, you can set multiple phone numbers on a single line.

Outgoing control

The following functions are added to control outgoing calls to outside lines.

LCR (Least Cost Routing)

A function that detects the dialed phone number and automatically selects the provider with the lowest call charge according to the number.

ACR (Automatic Carrier Routing)

A function that automatically selects a predetermined provider.

Call function between extensions

Call function between extensions
This function allows calls between extensions. Because the same line is used for calls between extensions, there is no communication charge. If there are multiple sites in a large company, you can also connect PBXs, which are the centers of each site, with the company’s dedicated line and connect the sites as if they were extension lines to build a communication network.

Representative number incoming call function

Incoming calls to the main number are connected to the phone of a group registered in advance, and there are calls that set priority and call in order from the highest priority, or calls in numerical order.

Transfer function

The following functions are available for transferring to other phones or mobiles when you are away or busy.

・Call forward ( Forwarding when you are absent or busy and unable to answer the call )
Busy transfer ( Forwarding to the specified transfer destination when the phone is busy)
Responding to delayed response ( When there is no response within the set number of rings, it is transferred to another phone)
Selected transfer (only incoming calls that meet the set conditions)
Out-of – service transfer (using a smartphone as an extension ) If the phone is out of service area, it will be transferred to a phone in another service area)

Park hold function

If you press the park hold button during a call, you can receive an outside line on any telephone. For example, if you don’t know who to transfer a call that is handled by an employee, hold the call to a specific number and check if there is a person who can handle it. This function allows you to resume a call on hold. In more detail, only the person who puts the call on hold can resume the hold phone, but the hold can be resumed from any phone.

The article below compares PBX’s specific services. Of course, the functions described so far are also included, so it will be helpful for those who want to deepen their understanding.

Park hold function pbx
20 Cloud PBX Service Comparisons | Basics and Benefits | Boxil Magazine
Currently, cloud-type PBXs are becoming mainstream because of the benefits that cannot be obtained elsewhere. PBX …
view the details

Difference from business phone

The business phone itself is not touched deeply, so if you want to know more, please see the article below.

business phone
What is the difference between a business phone and a regular phone? | Structure / Function / Features |
Business phones that are now being introduced as usual by any company.

Common points between Business Phone and PBX

Business phones and PBXs have the following functions in common.

  • One line is shared by multiple extension telephones and used for incoming calls from outside lines and outgoing calls to outside lines.
  • Call and transfer between extension telephones.

Difference between business phone and PBX

Some things you can do with a PBX but not with a business phone include:

– it is used in the extension of the smart phone (to receive calls on the go is, it’s business phone will take the transfer fee)
the base between each other in the – another location, be connected by extension
information, call the other party Display CTI function
・ Connect to PC

Business phones and PBXs also differ in the following respects.

Number of phones that can be connected

Some business phones can be connected to several hundreds, but usually only about 50. PBX can connect thousands or more, and it is possible to support multiple sites with one PBX.

Office form

A business phone can only be used on one floor with a single base that does not cross floors, but a PBX can be used even when there are multiple bases such as a company that spans multiple floors in the same building, branches, and factories.

Required functions

Business phones have many basic functions that are easy to use for users with many external calls, such as automatic forwarding of external lines, registration of abbreviated numbers, and registration of extension numbers. Advanced functions are not required.

Business phones are centered on support for customer-facing and external phone support functions such as voice mail and forwarding to the outside, while PBX builds an extension network at multiple locations to lower call costs, It is used for the purpose of improving internal business efficiency, such as linking with a PC.


Since business phones do not have dual CPUs, they cannot be used if the system goes down. PBX is equipped with a high-performance dual CPU that can handle high traffic, so even if one CPU goes down, it can continue to be used with another CPU.


Business phones usually cost several million yen at most, but PBX costs millions to tens of millions of yen depending on the scale. Business phones also require a main unit (ME) to be installed, but the initial setup costs are lower than with PBX.

Types of PBX

PBX currently used by many companies, but IP-PBX and cloud PBX are spreading in addition to conventional PBX. Introduces the functions and features of IP-PBX and Cloud PBX.


Internet Protocol PBX, which is installed on the same premises as a conventional PBX. It is a PBX that supports IP, which is a LAN protocol, and enables voice communication on an existing LAN. In other words, an extension network is built with LAN cables by assigning an IP address to each terminal (telephone or PC) instead of physically wiring the extension connection. There are special equipment provided as hardware and software installed on a general-purpose server for systematization.

IP-PBX has the following advantages.

・ Even if the extension user changes seats, it is not necessary to change the extension number by simply rearranging the LAN cable.
-The extension telephone function can be used as a function of a computer network, and a system linked with a personal computer can be constructed.
・ PBX installed at each site becomes unnecessary by using the Internet.
・ Because the extension between bases, call charges between bases are reduced.
-Easy to manage with a personal computer.
-If you install the application, you can also extend the smartphone.

The following functions are not available in the conventional PBX.

・ Record call contents on PC.
・ Ability to send an answering machine as an email attachment.
-Click to Call function to make calls from the phone book.
・ SIP, the standard protocol for IP telephones, allows PCs and smartphones to be used as extension terminals. When using a personal computer, there is a function that pops up caller information on the incoming call screen.
-A function that displays the company’s representative number as the calling number from the smartphone when the smartphone is used as an extension.
・ Video call function.
・ Recording of call contents, call time, caller’s phone number information, and other functions for backup.
・ Paperless fax function that allows you to send and receive faxes without using a computer or paper.

Cloud PBX

Rather than installing PBX equipment on the premises, it uses telephone exchange function services in the cloud, and is a step further in IT-PBX.
The function is basically the same as IT-PBX, but it has the following advantages.

・ Reduce initial costs for installation and operating costs including power costs.
・ Reduce operations related to operations.
・ Even if the company scales up, it can be expanded immediately without the need for new installation.
・ Only necessary functions can be selected from various functions.
・ Cooperation with mobile devices is possible.
・ Installation costs are not required even if the office is relocated.
-Telecommuting employees can also use it.
・ Calls between locations including overseas are free.

Tips for choosing the best PBX for your company

When installing or replacing a PBX, the selection points for selecting an IP-PBX or a cloud PBX are as follows. In addition, the number of employees and the number of lines used at a single site is small, and there are more functions to connect external calls such as business partners to the extension rather than the extension function between the bases, the video call function, and the extension of the smartphone. A business phone may be sufficient if you want to focus on.


If you want to keep initial costs, operational costs, and maintenance costs low, or if you want to reduce call costs between locations, including overseas locations, a cloud PBX is better. However, because most of the cloud PBXs have rental fees, for example, a company with a scale of 100 people or more, it may be cheaper to lease or purchase an on-premises IP-PBX.


If the business or company scale is expected to expand in the short term, a cloud PBX that can be expanded immediately without installation work can be continued more quickly.


If you want to select a function freely, or if you want to easily extend a smartphone or tablet device, a cloud PBX is better.


If you are concerned about the security of calls, it is better to use an IP-PBX that communicates in an environment protected by a corporate network without connecting to the Internet. In addition, with Cloud PBX, it is not possible to call some special phone numbers such as 110 and 119, and telephones can no longer be used if the office is out of power. It is better to choose IP-PBX even when the environment is bad.

What are PBX (Private Branch Exchange) Benefits?

Following are the some basic advantages of PBX:

Reduce call charges

A company with multiple employees has a telephone set for each employee or group. If you talk to a colleague on the same floor using this phone, you will be charged a communication fee if you communicate through the telephone office of the carrier. PBX reduces this call charge. PBX can activate internal communications without worrying about call charges.

Effective use of line

If there are multiple employees, multiple external lines are required. If you have a fax machine, that line is also required. However, just because there are a total of 12 telephones and fax machines, 12 lines are not necessary. If it is possible to connect up to 4 lines at the same time, it is efficient to apply for 4 lines to the central office, collect the 4 lines and share them together. PBX can aggregate this line. You can also reduce the basic charge by consolidating the lines.

Reduce operational costs

Since IP phone charges are the same in USA, you can extend your smartphone by installing applications . Extensions can also be used for calls with employees, reducing operational costs.