What is the Difference Between Cloud PBX and VoIP?

In the world of digital solutions, the sector of telephony communications has seen some amazing advances. One of the best is the trend that moves businesses away from problematic analog systems and towards connectivity-run phones. Two of the most popular options include cloud PBX and VoIP.

Most people who are familiar with the basics of such technology might correctly assume that they are very similar; but, what exactly sets them apart, and how do you know which technology is the best choice for your business? 

By discussing and comparing their various designs, features and purposes, we explain exactly what cloud PBX and VoIP are, and hopefully, this will give you better insight into which one can be the most valuable addition to your communications network.

What is Cloud PBX?

A cloud-based PBX system is a step up from the more traditional PBX network, which is hallmarked by a lot of physical equipment that must be located on the premises of the business. Such hardware can include phone sets, cables and large servers. 

When you migrate your PBX phone network to the cloud, aptly called cloud PBX, or sometimes hosted PBX, it eliminates the need to have all that physical hardware on site. It makes scaling easier than ever before, seeing that the only thing you need to add is an extra handset or two. While the handsets remain in the office, the functions of everything else are taken over by a remote service provider. 

Not only does cloud PBX give employees more space and the office a neater look, but it also takes several operations up a notch, including bringing together management, project integration and collaboration, cost-effective in-house communication and connectivity with the public switched telephone network (PSTN). 

What is VoIP?

Short for Voice Over Internet Protocol, VoIP phones are also known as IP phones. Legacy phone networks, which carry voice signals along analog phone lines, require specialised hardware called PBX (Private Branch Exchange) which links the internal phones of a company to the public telephone network. 

VoIP phones, on the other hand, record your voice, turn it into signals and send them via real-time data packets over a local connectivity network, like WAN, Ethernet and high-speed Wi-Fi. 

As you can see, both VoIP and cloud PBX are connectivity-based technologies, and both were designed to take telephone communication networks to the next level. 

Other similarities include:

  • The elimination of nearly all hardware on-site
  • Clear audio quality
  • Useful features that make collaboration and workflow easier
  • Quick installation
  • Affordable monthly fees 

In both instances, all maintenance and updating issues also fall squarely on the shoulders of the service provider – not you. Most such operations can also be performed remotely. 

Do Cloud PBX and VoIP work together?

Despite their similar purpose and connection to the online world, hosted PBX and VoIP are not the same thing. They’re close enough to allow you to use them together in the same office or building, but they are not so similar that they are a hundred percent interchangeable. 

In other words, you cannot replace major parts of one with the other. This hybrid system simply won’t work. 

That being said, many cloud PBX providers rely on a VoIP service to replace the physical cables of an analog phone network in the office. This is the only way that cloud-based PBX and VoIP can work together, but it’s a great merger. 

This blend allows business owners to cut costs and work more effectively. Interestingly, you don’t need a PBX system to use a VoIP service! In such a case, the only thing you need is a VoIP phone and a stable internet connection.

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The differences between Cloud PBX and VoIP

Now that we’ve established that the two systems are alike in some ways, it’s time to look at what makes them different. 

The truth is that cloud PBX and VoIP serve the same demographic. They are for dedicated business owners who wish to use a phone network that is less expensive, more digital and efficient, and comes with no hardware maintenance. 

Cloud PBX can be described as a communications platform. In other words, it’s generally a more complete and flexible phone network system than VoIP. 

The latter, on the other hand, is mostly only a method for making calls. However, if you prefer VoIP, there is something called a hosted business VoIP phone network, and it offers a complete professional phone network. 

How do I know which phone system is best for my business?

Knowing which phone system will be the most beneficial for your business comes down to doing your due diligence surrounding the unique needs of your company. What might work for someone else might not work for you, so the first step is to make a complete assessment of the reasons why you want to move your network over to the cloud or a VoIP system. 

While it certainly remains a personal decision for the most part, there are times when VoIP or cloud PBX might be better suited than the other when it comes to certain types of business setups. 

VoIP is often preferred by smaller companies and solo entrepreneurs; but, it’s not unheard of to see bigger companies choose VoIP, plainly because they want to dip their toe into the world of online-based phone networks for the first time. 

Cloud PBX is a great choice for businesses of all sizes, but it might be a better choice for companies that are widely dependent on phone networking and other types of calls. Cloud PBX is often cheaper than VoIP, and since it was designed to be a flexible communications platform, it can also offer more specialised features.

Which is better: Cloud PBX or VoIP?

Being so similar in purpose and function, which technology is the best overall? A big factor in deciding the winner is, once again, personal choice and circumstance. 

One company might thrive with a VoIP system, while another can practically only move forward with their communication and business goals once they incorporate cloud PBX. 

The best way to understand what communications system your business needs is to speak with the team at United Telecoms. We aim to learn about your business, its current processes and future plans to help advise on the best system to choose.

Cloud PBX is for Everyone

If there has to be a winner today, and personal preferences aside, cloud PBX might be the better choice. 

This doesn’t mean that VoIP is bad or not worthy of being considered – VoIP certainly has its place and benefits – however, cloud PBX is extremely versatile and is suitable for those who are moving away from analog phones for the first time, as well as for companies that are used to cutting-edge technology. 

It’s perfect for all sizes and types of businesses too.

Cloud PBX has More Features 

Another reason that makes cloud PBX so popular is the fact that it offers a host of useful features that are business-orientated. Apart from linking staff in a way that was never possible before, companies can collect data to see how many calls are answered and by whom. 

There are also services like auto-attendant and automatic rerouting to help callers reach the correct department within the organisation, just to name a few. Some cloud PBX providers allow clients to customise their own packages by selecting only the features that they need, which eliminates a complex, cluttered system.

Cloud PBX Might Be More Stable

Both hosted PBX and VoIP rely on connectivity in order to work. Neither can function properly when your internet connection is weak or keeps dipping. In order to work as they should, both technologies require a consistent, high-speed connection. 

But even so, VoIP has a tendency to hiccup even under the best of circumstances. The good news is that this is not such a common occurrence that VoIP should be avoided, but if you absolutely insist on working with the most stable phone system, then cloud PBX certainly offers more consistency. 

Cloud PBX and VoIP for business communication

At the end of the day, there aren’t a lot of differences between cloud PBX and VoIP technologies. Both were created to squash the same old problem, which is to eventually replace old-school analog phones and traditional PBX systems. 

For this reason, both moved into the cloud, so to speak, and this shift made communication more efficient and cheaper, and maintenance also became a breeze. 

Since VoIP and cloud PBX serve so many different types of businesses, both will continue to have a place in the world of telecommunications for the foreseeable future. 

It is not truly a question of which one of the two is better or worse than the other; it is more about which one is the right platform or calling method for your business, based on the purpose and needs of your calling network.

Got questions? Contact our experts today.


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