A hosted PBX is essentially a cloud-based phone system, as it is hosted off-site and over the Internet rather than at the physical location of the business, this results in cost savings and limited maintenance.

There are three basic components to a virtual PBX: the hosted PBX provider, a VOIP phone, and the Internet. Once it is set up, your phones will connect to the PBX host via the Internet, and your connection will always remain open to make and receive calls.

A hosted PBX is a cloud-based phone system, whereas VoIP is the method for making calls. A hosted PBX uses VoIP in its operation. They both work in harmony together as a platform and method. Combining these two modern telecom technologies is a great way to increase business efficiency and cut costs.

VoIP technology is used to send voice traffic via the internet utilizing a broadband connection for incoming and outgoing calls. While a traditional analog PBX connects to a PSTN [Public Switched Telephone Network] via copper wire allowing dependable but basic voice calls.

A traditional Analog PBX often described as a Plain Old Telephone Service (POTS) is becoming somewhat of a rarity these days.

With an analog/traditional PBX, you are provided with simple functionality; for instance, options such as speed dial, hold, and mute as well as being able to transfer incoming calls to other extensions. A hosted PBX is designed to offer all the advanced features that a business might need including auto attendants, blocklist and allowlist, call queuing, conference calls, and voicemail to name.

There are plenty of benefits to setting up a hosted PBX, but the most significant advantage over traditional PBX is the savings made for the initial configuration and set up as well as recurring and maintenance costs.

Some of the main benefits of Hosted PBX include:

• The ability to quickly scale up or down depending on demand
• On-demand Access to toll-free and local phone numbers
• Improved capability in dealing with inbound call spike
• Removes the extra costs such as setup, maintenance, and upgrades associated with a traditional PBX
• New features are added, and existing features are upgraded without additional costs
• Increased security and reliability
• Advanced infrastructure with dedicated servers ensures business continuity with no downtime.