How a Hosted VoIP PBX System Works

Updated: February 09, 2011

Simply put, a hosted VoIP PBX system is a phone system that runs over the Internet. The phone system software resides in a data center that has a high speed connection to the Internet. The consumer no longer has to purchase and maintain any hardware or software as was the case with analog phone systems. The only equipment the consumer needs is a VoIP phone plugged into a high speed Internet connection (cable, DSL, T1 etc.) It cannot run on a dial up connection to the Internet.

Since the software for the phone system is located in a data center attached to the Internet (typically called 'Cloud Computing') the consumer can login and update the settings anytime they want to. And since it is based on software, new features are typically added frequently. Some of the standard features seen in most hosted VoIP PBX systems include:

• Auto Attendant or Main Greeting
• IVR (Interactive Voice Response) which means you can greet the caller and ask them to press a button to be moved to the next IVR or to an extension
• Dial by Name Directory
• Music or Company Message on Hold
• Hunt Groups (calls multiple numbers simultaneously or in sequence to find you)
• Call Queues (Intelligent call routing used in call centers)
• Conference Calling
• Call Recording
• Call Reports (accessible via the web)
• Time based messaging for after hours recordings and routing
• Transfer a call to any user on the phone system no matter where they are located
• Long distance discounts or free long distance

And much more. Typically there are more features available with a VoIP PBX than would be available with an analog phone system.