What Does PBX Stand for In Telecom

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With the sheer number of abbreviations for telecommunications, it can be confusing to understand the difference between PBX, VoIP, PSTN, and POTS. However, we hope they will make more sense after reading this guide and have a better understanding of how the telecommunications industry is always on the leading edge of improving business communications.

What Is PBX?

PBX also referred to as Private Branch Exchange, and it is a commonly used phone system that is used by businesses. Traditional business phones, the ones that helped to make telecommunications possible, began with having one assigned user at a time. This means that if a co-worker had to make a phone call, there were two options. The handset could have been physically passed, or someone could provide them with their own number.

Business owners who had more than one office, even if the offices were in the same area, had to get a new number along with a new connection. With this antiquated phone system, business managers never knew who received which phone call or what was discussed during the phone call. It also meant that companies that wanted to expand to other locations had to have connection points at every location.

Fortunately, PBX phone systems have revolutionized communication for businesses. It has provided them with a huge upgrade for all previous physical limitations. There are many different options including:

  • The Internet
  • VoIP technology (Voice over Internet Protocol)
  • Cloud services
  • SIP trunking

These systems allow colleagues to speak with one another whether they are a mile away, or 3000 miles away. Copper wiring is no longer a necessity if businesses want to reach out to their customers. Instead, global businesses can be created with unique phone numbers that can be used for marketing and brand recognition. However, perhaps the most important advantage is that these types of systems can be installed for a fraction of their conventional counterparts with less time output also.

So, what is the history of PBX systems and how did they evolve to the advanced systems they are today?

The History Of The PBX System

If someone has ever called a business and was asked to press a number from a menu of options, that the PBX system in action. Businesses of all sizes rely on this type of telecommunication system for efficiency and growth.

So, why is it important to understand the history of the PBX system? Well, if a business owner is thinking about upgrading to PBX, or is are already using a PBX, it is important to know the history. That way, the business owner will better understand the features, and he/she will better understand its value within the company.

For example, if a small business owner is using an outdated PBX version or no PBX at all, it is just like conducting the company’s telecommunications the same way businesses did in the early nineteenth century.

Before PBX, manual switchboards were the modern-day technology. In fact, the first switchboards came into use shortly after Alexander Graham Bell invented the telephone. By the beginning of the 20th century, being a switchboard operator was a highly sought after job by young women entering the workforce.

The job of these switchboard operators was to answer incoming phone calls, find out who the caller wanted to talk to and plug the cord into the right phone jack.

However, this became an issue after The Great Depression. Once businesses began to grow, they had an influx of internal calls. These calls from one department to another began to cost businesses money. It was during this time, the first generation of PBX systems was designed.

PBX Switchboards

Until the 1960s, businesses were dependent on the phone companies to connect calls within the business. Calling a colleague in another department was the same as calling a friend across town. However, it was not long before companies began to invest in internal calling systems using their own hardware and switchboard operators.

The general idea was to share a few phone lines across many phone numbers. The first business to utilize this type of switchboard was law office in Richmond, Virginia. By the 1900s, businesses from all different sectors were investing in these switchboards with their own company hired operators. Those that could not invest in their own switchboard had the option of renting a switchboard. This was known as Centrex Service.

PBX And Electronic Switching

In the early 1970s, semiconductors provided faster and more reliable automation of PBX. As a result, there was no longer a need for human operators. These systems were more expensive than the manual PBX, and so they were given a new name. It was PABX.

Once human operators were terminated, switchboards become more affordable, and the appeal of the phone systems increased.

PBX – Evolution From The 1970s To Present

TDM PBX systems paved the way for the types of systems that are used today. These systems allowed multiple streams of information to be interpreted over one path. Telephone companies transitioned from analog to digital transmissions, and this transition allowed these systems.

By 1990, the Internet was still in early development. Only the rich or the tech enthusiasts had access to it. However, when Internet Protocol joined forces with PBX, a new type of business telecommunications was born.

If someone is thinking about installing a PBX system in a company, hopefully, this guide has made the decision easier. Business telecommunication has come a long way, and you can use these technological advancements to make businesses more efficient.