Purchasing a new phone system for your small business can seem a bit overwhelming. There are so many options and features and functions to navigate, and most of the terminology sounds like something from a tech manual.
As you begin your search for the right phone system solution, it’s important to feel comfortable and confident in knowing what you do and do not need. For that reason we’ve provided a “cheat sheet” to help you understand business phone system language.
These are the terms you’ll see most often as you make your buying decision. These terms will also help you understand the functionality of your system once you’re up and running.
Cloud based phone system
A cloud phone system allows you to make phone calls over the internet rather than over a traditional analog phone line that used copper wires or electrical fibers to make a connection. Cloud-based phone services use a group of phones that work together to route all calls through an Internet connection.
Cloud phone systems don’t require you to have phone hardware on the site of your business, which requires infrastructure and maintenance. To run a cloud based phone system all you need is the right phone and an internet connection.
With a cloud system your telephone network and all it’s information is hosted online, in “the cloud.” Cloud phone systems are also known as “hosted phone systems.”
VoIP
Voice over Internet Protocol (VoIP), is a technology that allows you to make voice calls using a broadband Internet connection instead of a regular (or analog) phone line. VoIP services convert your voice into a digital signal that travels over the Internet. If you are calling a regular phone number, the signal is converted to a regular telephone signal before it reaches the destination.
PBX
PBX stands for Private Branch Exchange, which is a private telephone network used within a company or organization. The users of the PBX phone system can communicate internally (within their company) and externally (with the outside world), using different communication channels like Voice over IP, ISDN or analog. A PBX also allows you to have more phones than physical phone lines (PTSN) and allows free calls between users. Additionally, it provides features like transfer calls, voicemail, call recording, interactive voice menus (IVRs) and call queues.
On Premise PBX
On-premise PBX is also known as an IP-PBX phone system. It is similar to a traditional PBX system because it is installed at the business locations, usually in a computer equipment room or phone closet. Calls can go through a traditional phone company as well as voice over Internet (VoIP).
Auto Attendant
An auto attendant (also automated attendant, or virtual receptionist) allows callers to be automatically transferred to an extension without the intervention of a human operator or receptionist.
Many AAs will also offer a simple menu system (“for sales, press 1, for service, press 2,” etc.). An auto attendant may also allow a caller to reach a live operator by dialing a number, usually “0”. This menu system is sometimes referred to as an “information mailbox.”
Automated attendants provide, among many other things, a way for an external caller to be directed to an extension or department served by a PBX system without using direct inward dialing or without switchboard attendant assistance.