Knowing Your PBX: Hosted PBX vs. SIP Trunking

The knowledge you need to make the decision on how you move to the cloud

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At times, it can be hard to track with all of the telecom industry’s acronyms and technical jargon. And somehow beneath the amassing weight of all this lingo, you’re supposed to make a decision about what kind of communications plan works best for your company!

So lets discuss one of the biggest decisions you have for upgrading your communications plan: Hosted PBX and SIP trunking.

In the big picture, the main difference between the two is a thing called a Private Branch Exchange (PBX). The PBX is essentially responsible for all the different features available for your phone. For a Hosted PBX, your provider provides the features. While for a SIP Trunk, your PBX provides the features and your company responsible for managing and running the PBX.

Let’s define the two options quickly.

  • Hosted PBX or Cloud Based Voice is HD quality voice service with full PBX features without the hassle of costly upfront expense and ongoing maintenance contracts. All you need to have in your office is internet, a router and phones (available from providers). Your provider takes care of the big things, like the PBX, network and everything else.
  • SIP Trunking is essentially a dial tone from a provider with a few limited features. Your company is in charge of having a PBX, phones and internet.

If you’re still fuzzy, maybe this diagram will help paint a picture of how the two processes work.


Ok, so now we know the difference, but how do you know which one to pick?

Well, here is a quick rundown of the two options:

You should consider SIP Trunking if:
  • You recently purchased a new PBX
  • You have locations that you need to connect in a hybrid scenario
  • You’re fine with getting limited feature set from your provider
You should consider Hosted PBX if:
  • You want to take full advantage of a wide scope of features your communications system provider has to offer
  • You want to lower costs by not purchasing your own PBX
  • You like the flexibility of being able to scale up and down and easily move locations
  • You value having viable contingency plans for emergency situations.
  • You have multiple locations and are looking to expand
    • Cost savings are accrued not having an on-site PBX and designated IT at every location
    • A single bill

The decision is ultimately up to you, but understanding your options is an important part of the puzzle.. Throughout the process, Momentum is here to help and to use our more than 15 years of experience in enabling customers to thrive to empower you and your communications.