VIDEO: Make the Analogasaurus Extinct! VoIP vs. Analog Phone Systems


Hi, welcome to Telonium Thursdays Whiteboard Web Series. I’m your host for this week, Alex.

This week we will be talking about business phone systems.

A phone system refers to all the components a business needs to get calls from outside and make calls itself. In particular, in order to have a phone # for your business but still have multiple extensions for your employees, you need something called a private branch exchange, or PBX for short. What’s a pbx? Well, last time we talked about something called the public switched telephone network, or PSTN. A PBX is basically the private version of that for businesses. It’s a PSTN in a box.

There are different types of pbx’s, but the first we’ll talk about are on-site pbx’s used for analog phone systems. This has a certain # of phone lines coming in and extensions going out.

The # of lines a business has represents the # of phone calls it can have going on at once. In analog phone systems, every line has a different phone #. Businesses can use hunt group so that if the first line is busy, a customer’s call will go to the second, and if that’s busy, the third, and so on.

Now, even though this business has 15 extensions connected to their phone system, they can have 6 calls going on at once.

There are some advantages and disadvantages to this system. We’ll talk about the disadvantages right now but will come back to advantages by the end of this video. For one , it’s not very scalable. If your business gets more employees, you could have to get a whole new PBX if you wanted more extensions. Like in the last example, the busines only has 15 extensions. So if a 16th employee wants a phone, tough luck.

The same thing applies to lines. If your business wants to be able to have 7 phone calls or more at once, a pbx with 6 lines doesn’t support that.

Secondly, it’s really expensive and a huge headache to install and manage. A lot of companies have to hire an IT guy just to take care of it.

Finally, if you want your business’s employees to telecommute, they can’t do so with an analog pbx. If they go home, they’re stuck with their cell phones and can’t use their business #.


There’s a second type of pbx called a hosted pbx that is most commonly powered by VoIP. This is the service that Telonium provides. Basically, instead of having a pbx on-site at your business, we host it for you on the internet.

So as long as you have a high-speed internet connection, you can use the Internet to connect to us, and we’ll connect you to the PSTN. This is great because it solves some of the problems of an analog pbx.

The hosted pbx is easily scalable. With a hosted pbx, you have unlimited lines, unlimited concurrent calls provided your internet is fast enough. And if more people at your business want a telephone, you can add extensions immediately by just letting us know. You wouldn’t have to get a whole new PBX.

Second, in a hosted system, since the PBX is online, you can use your business phone # anywhere as long as you have an internet connection. You can be at home, at the beach, at a park, wherever. This means you and your team can telecommute.

Third, because the pbx is online, you can get rid of your entire analog network. Rather than having a lot of phone lines installed at your office, you can just use your one internet connection for all your phone and data needs.


We mentioned that there are advantages of having an on-site system earlier, so let’s discuss those now.

First, if your office site does not have high-speed internet available, the analog option is better

Second, if you are an enterprise level company and already have one or more full-time IT support members, it might be more cost effective to have physical control over the phone system on site.

See, the costs associated with having an on-site phone system are the following:

But for hosted, you don’t need to pay for the first part.

To summarize, a pbx is a private version of the PSTN that connects your employees to the public. We talked about some of the differences between onsite and hosted phone systems, and it’s clear there are pros and cons for both. A large company might profit most by using their own onsite system. But for small businesses, because of cost, scalability, and convenience, the hosted system generally provides the most benefit.


Okay everyone, I hoped you learned a little bit today; don’t forget to tune in next week to a new addition of Telonium Thursdays. And until then, you can us follow at Twitter @telonium or visit our website at Thanks everyone!