What to look for before purchasing an IP PBX system

By Kevin Stewart
Updated: January 31, 2011

IP PBX systems apply the advanced technology of Voice over IP (VoIP) to deliver the features of Private Branch eXchange (PBX) telephone systems. When choosing an IP PBX system for your organization, you should consider the following factors:

  • Hosted vs. on-premise
  • Calling capacity
  • Number of locations
  • Feature set
  • Security

Hosted vs. On-Premise

The choice between a hosted system and an on-premise IP PBX depends on the type of business you operate. Many technology businesses have a large network budget, and they are able to leverage their technology expertise and their overall spending to purchase and operate their own IP PBX equipment. For businesses that just need to get up and running with a solid system, the better choice may be a hosted solution. With its flexibility, guaranteed availability, and support, the hosted option is worth considering for any organization.


Sizing your system is a good next step. One of the advantages of IP PBX systems is their flexibility, but it is important to have enough calling capacity to support your business needs. Most systems start with support for 20 stations, and some offer support for an unlimited number of calling stations.

Number of locations

In the past, telephone systems were restricted to their physical locations. Using IP PBX, your company can operate from multiple virtual locations, while maintaining a single physical location. Even international calling is supported using VoIP technology. This allows your business to maintain a presence in the markets it serves, by providing a toll-free or local number that callers will be comfortable using.


The list of features available with IP PBX can be overwhelming, but making a short list of your highest priority capabilities will help you choose the right systems. All systems will have the basic incoming feature set, such as call waiting, call forwarding, and voice messaging. Extended features such as voice to email or voice to text messaging are also becoming standard IP PBX features. You should also determine whether your highest call volumes will be incoming or outgoing. The features needed for call centers that make or receive a large volume of calls are very different from a typical office that has an even balance of call activity.


Security is a major concern for any business telephone installation. If your premises are secure and under your control, then an on-premise IP PBX system should be adequate in terms of physical security. In some shared office situations where you do not control the telephone system cabinet, on-premise may actually be less secure than the hosted alternative. For call and data security within the IP PBX, there are varying levels of security available, from unencrypted through strong encryption. Before you purchase your system, make sure it meets your organization’s security requirements.

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