How does an IP-PBX work?

If you're thinking about jumping into the world of VoIP, one option is an on-site IP-PBX. With products ranging from freeware open source to turn-key appliances, you'll find many alternatives for businesses of any size.

The term "IP-PBX" is commonly used, but it is slightly misleading because the roles the old PBX systems and new VoIP-enabled ones are not a one-to-one match.

In standard analog telephony, each phone is connected using pairs of wires to a central switch, called a PBX, which then connects to the local telephone company and long distance providers using more wires. Every call goes through the PBX and every telephony feature (such as automated attendant, call forwarding or voice mail) is a function of the PBX.

In the world of VoIP telephony, the function of the PBX is more distributed. For example, once a call is set up, the actual voice traffic can go directly from one IP telephone to another IP telephone without passing through the PBX.

Most IP-PBX systems are designed to work with IP-based telephones connected to an existing corporate LAN. While it's not strictly necessary, many network managers place the IP phones on a dedicated-and firewalled-VoIP LAN.

The IP-PBX itself is the only piece of the VoIP network which will need to talk to the Internet, either to deliver calls to a VoIP telephony provider or just to have access to necessary software updates. These Internet-based telephony service providers can accept calls from you using standardized protocols, such as SIP, and deliver those calls to local numbers, long distance, or international phone networks. The connection works both ways as well: an Internet-based telephony provider can take calls coming from the traditional phone network to your phone numbers and deliver them to you using VoIP protocols directly over the Internet.

Smaller companies with only a few analog phone lines can use analog gateways to make a connection to a regular public switched telephone network. If you're using digital trunk services, such as PRI ISDN or traditional T1 circuits, you'll need to have a PRI or T1 gateway. Some hardware IP-PBXes have analog, PRI and T1 gateways "on board," but it is just as common to have these gateways as separate, LAN-connected devices.

Smaller businesses may want to use hosted IP PBX services as an alternative to having their IP-PBX on site. Since the connection between IP telephones and the IP PBX is over, well, IP, there's no reason they all have to be co-located in the way a traditional PBX requires. Hosted IP PBX services offer the same advantage of many other outsourced products, including a more comprehensive feature set than is found in low-cost IP-PBXes and lower capital and operational costs. When a hosted IP PBX provider also sells local and long distance service, they may be able to cut those costs by aggregating business customers to gain a larger volume discount.

However, hosted IP PBX services have drawbacks that make them inappropriate for many businesses. The most common deployment model requires all calls, even those between people on the same LAN, to go through the IP PBX. This puts significant stress on Internet connections, requiring lower latency and greater attention to QoS controls. Small business Internet connections over asymmetric broadband connections such cable modems or DSL are rarely capable of providing acceptable service for more than a few users.