What is Cloud PBX and How Does It Work [2020]

Back in the old days, traditional PBX systems handled all the call management and routing for businesses. However, most organizations could not make use of a conventional PBX system as it was expensive and difficult to maintain. 

The cloud technology has revolutionized how businesses use their phone systems. As cloud allows companies and individuals to utilize resources, including servers, databases, applications, etc., over the internet, it also facilitates them to use hosted PBX solutions for their telephony requirements. 

In this article, we will cover all about cloud PBX from its working to how you can set it up for your business and how you can choose a good cloud or hosted PBX provider for your business.  

Content Index: 

• What is cloud PBX and How does it work?
• Advantages of cloud PBX.
• Limitations of cloud PBX.
• How to setup cloud PBX for your business?
• How to choose the right cloud PBX for your business?
• Closing Summary.

What is Cloud PBX and How Does it Work?

To understand how cloud PBX works, let’s break it down into cloud and PBX. 

Cloud – Cloud allows companies to pool IT resources, including servers, storage, applications, etc. over the internet. Along with resource pooling, there are various other benefits of cloud technology – data security, negligible downtime, etc.  

PBX – PBX stands for Private Branch Exchange, which is legacy hardware responsible for routing and managing calls by businesses. It is quite an expensive piece of equipment that requires regular maintenance.

By the above two definitions, we can infer that in a cloud PBX system, companies can rent the PBX system hosted and maintained by a 3rd party over the internet.

Advantages of Cloud PBX

1. Scalability – With a cloud PBX solution, you can easily upscale or downscale your telephony requirements based on your business needs. You can easily add N number of extensions with a web-based interface and that too in just a few clicks. Best of all, no technical knowledge required.  

2. Flexibility – You get the latest business phone features without dealing with hardware changes as your hosted PBX provider takes care of it. 

3. Affordable – Cloud PBX system only charges you for what you use. Most cloud PBX providers in the US and other parts of the world offer flexible pricing plans based on the number of users, extensions, and the total number of calling minutes required.

4. Strong business presence – With a cloud PBX solution, you can get a virtual number for your business. There are two types of virtual numbers – Local numbers and Toll free numbers.

With a local number, you can establish your business as a regional player, and with a toll free number, you can expand the reach of your business.

Limitations of Cloud PBX 

As cloud PBX solutions are internet-based, there are some drawbacks associated with it. 

1. Security – As the internet powers cloud telephony, it is susceptible to possible hacks. However, the risk can be minimized if your cloud PBX provider follows the best VoIP security practices to secure data transmission and physical storage.  

2. Low Bandwidth – For cloud PBX, the call quality is dependent on your internet connection. To ensure HD call quality, you will require a high bandwidth internet connection. 

However, the call quality is determined by the codecs used by your cloud telephony provider. Codecs is a software program which encodes and decodes digital data stream (audio and video).

How To Setup Cloud PBX For Your Business 

Setting up cloud PBX for your business is quite easy, and it also doesn’t require any technical expertise. You need an internet connection to connect with your cloud PBX system and configure it as per your business requirements. 

The only hard work in setting up cloud PBX for your company is to find the right service provider who is accountable for your business and offer all the latest business phone features with exceptional customer support.  

How To Choose The Right Cloud PBX Provider

Watch this video to know how you choose the right cloud communication or PBX provider for your business: 

1. Network & Data Security

Data is essential for any business, and its security doesn’t happen on its own. You have to be a little proactive and know how your cloud PBX provider will be securing your data while transmission and physically in their data centers. 

2. Reliability

One of the best advantages of cloud PBX solutions is that it offers business continuity. In case of any natural or human-made mishap, your business will not get affected as the cloud technology maintains replicas of your company data at data centers at different locations. Therefore, in case there is a flood at the site A office, then the cloud PBX will automatically shift your telephony solutions to the next server. 

3. Customer Support

Before committing to any hosted PBX provider, check their customer support policies. A reliable cloud communication provider should offer real-time support to your business in case of any technical glitches, even on holidays. 

4. Flexible pricing plans

It is vital for you as a business owner to make sure that you pay for only what you use. Therefore, perform a market analysis of cloud PBX providers and check what premium business phone features they are offering and at what cost. 

5. Analytics & Reporting

Most reputed cloud PBX providers offer an easy to use the web platform to configure your virtual number and get real-time analytics & data reporting. 

With analytics, you get the essential metrics like the total number of missed calls, agent’s idle time, average call hold time, etc., vital for formulating future business plans. Therefore, before picking up a cloud PBX solution provider, make sure you ask for an admin panel where you can manage your business numbers and get call analytics & reporting features.  

Closing Summary:  

Cloud PBX solutions can help your business to streamline work processes to offer delightful customer experience and product support. In this guide, you learnt about what is cloud PBX and how it works.

Additionally, you also read about various factors that you should keep in mind while choosing the right cloud PBX provider for your business. This information will help you to set up a secure and reliable cloud PBX solution for your organization.

In case, if you have any queries related to cloud PBX set up, then connect with our solution experts.