Date published 10/07/2017    Written by DataKom

Hosted PBX vs SIP trunking: What's the difference?

Hosted PBX and SIP trunking are both great VoIP solutions with similar features, but they differ in technical and logistical aspects.

If you’ve decided to upgrade your existing phone system, or looking to learn more about different VoIP systems, read on. We’ve put together this handy guide to help you choose the right system for your business.

What do they have in common?

The main feature both systems have in common is that they use an internet connection to deliver VoIP services between users.

It’s a modern alternative to the traditional phone system which uses a physical phone line - ISDN. Which, in fact, will be switched off in 2025, and will make all non-internet-based phone systems redundant.

As businesses look for other ways to make their operations more efficient and cost-effective, the adoption of cloud-based phones has been growing steadily over the years. The technological advancements in cloud computing make this move to the internet, a logical next step.

How do they differ?

Both systems have a lot in common, but the key difference is in the deployment and location. PBX (Private Branch Exchange) is, essentially the switchboard where all communication is streamlined - this includes voice, data, fax, video and extensions.

SIP Trunking

PBX equipment for SIP trunking is located on the premises of the business. Hardware needs to be purchased, maintained and configured by in-house specialists. This includes upgrades, security and general IT management of the system.

Pros of SIP Trunking

  • Can be integrated with your existing traditional phone system
  • Provides a modern cloud-based solution by routing voice over the internet
  • Easier to maintain than a traditional phone system
  • Eliminates the need to purchase BRIs (Basic Rate Interfaces), PRIs (Primary Rate Interfaces), or local PSTN gateways which lowers telephony costs

Cons of SIP Trunking

  • It may require higher upfront cost for the purchase of new on premise equipment
  • Needs in-house IT maintenance and troubleshooting can be more challenging
  • Less secure as only one system needs to be compromised for hackers to gain access to your data
  • Needs more planning and engineering for network load and system capacity

Hosted PBX

With hosted PBX, the exchange is located in an off-site data centre and deployed in the cloud. Since the need for on premise hardware is eliminated, the cost of setup and maintenance is much lower, while it still offers greater functionality and scalability.

Hosted PBX supports all phone system features such as voicemail, call waiting and recording, conference calling, logs and many more.

Pros of Hosted PBX

  • Offers a lot more features than a traditional phone system
  • Easily scalable and very flexible - add new users or features with minimum hassle
  • No purchase of PBX equipment is required
  • No on-going system maintenance and hardware upgrade costs
  • Managing disaster recovery is a lot easier as traffic can be rerouted to a different data centre

Cons of Hosted PBX

  • Old phone systems may not be compatible, so they’ll need to be replaced
  • Depending on the provider, VoIP connection may not be supported by redundancy system - DataKom allows for a backup system in case internet goes down.
  • Enterprises which need more control over the hardware can’t have it
  • As with any cloud-based solution, security is a concern

Our verdict

There’s been a global move to the cloud due to lower costs and superior flexibility - companies that don’t make the switch to a more modern telecom solution, will fall behind. By choosing to adopt business VoIP you can expect better client satisfaction, increased continuity between offices and more efficient operation. Also, keep that ISDN switch off in mind, don’t get caught out unprepared.