Hosted PBX VS SIP Trunking: Which is Right for Your Business?

For companies that are hoping to save money and streamline business communications, the decision to choose a Voice over Internet Protocol (VoIP) phone system is a smart move. When compared to traditional telephone services, VoIP is far more customizable and feature-rich. Plus, the ability to scale at will on top of the system’s increased reliability make VoIP highly attractive.

It’s important to emphasize, though, that VoIP is not a single solution. Rather, it’s an umbrella term that covers any form of voice communication that is carried out over Internet Protocol (IP) networks. When implementing a VoIP solution, there are various options businesses can choose from. Two of the most common solutions are Hosted Private Branch Exchange (PBX) and SIP Trunking. 

In this article, we’ll take a look at each service to help you decide which option is most suitable for your business.

What is a Hosted PBX?

Also referred to as an IP PBX or virtual PBX, a hosted PBX solution is a telephone system that provides PBX functionalities (such as call conferencing, automatic call distributions, call forwarding, do not disturb, etc.) to businesses but without the need to own or maintain any onsite equipment. With hosted PBX, the call platform and its features are hosted or handled by the VoIP service provider in the cloud. It is no longer the business’ responsibility to own, operate, secure, maintain or upgrade the necessary hardware. This allows companies to focus on their core competency, as well as enjoy significant cost savings through limited required equipment.

What is SIP Trunking?

With Session Initiation Protocol (or SIP trunking), users are able to continue using their existing telephone system or PBX equipment, but without the exorbitant costs of connecting to the PSTN. SIP trunking replaces traditional phone trunks with the internet; which means your phone calls will be routed through the internet instead of traditional phone lines. This solution requires an IP-enabled on-premise PBX and a VoIP gateway that connects your PBX to the cloud.

So Which Solution Should You Choose?

As with any business technology, the decision depends on the needs of your business. You need to consider various factors first before making the switch. The following are only some of the things you should weigh in order to make an informed purchasing decision:

    • The size of your business – For startups and smaller businesses (with anywhere from 5 to 20 employees), hosted PBX is usually the better choice as it provides all of the standard and advanced VoIP features at a lesser cost. SIP trunking, on the other hand, is ideal for larger enterprises that already have an existing PBX in place and simply want more affordable calling.
    • Scalability – As a business expands, so do their communication requirements. Both options are highly scalable, but with SIP trunking you would need to purchase additional on-premise servers (and thus spend more money) to be able to add new phones and users to your phone system.  A hosted PBX service, on the other hand, would only require a notification to the provider or a few changes in your account’s web portal, which can be completed in a few simple steps.
    • Maintenance – If you’re choosing SIP Trunking solutions, maintenance issues must be handled by your IT staff. They are responsible for the upkeep and must ensure that your software is up-to-date. This can prove extremely challenging for some businesses, especially if they don’t have highly skilled and knowledgeable IT personnel. With hosted PBX, on the other hand, all of the necessary upgrades and maintenance will be taken care of your VoIP service provider.

Assess your business’ wants and needs and choose the most appropriate VoIP service solution today!

 

 

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