PBX in the Cloud: Telephony Transitions from Closet to Cyberspace

In a few years, a visit from the phone company’s tech guy to work on your PBX is going to be as obsolete as an early-morning delivery from a milkman. Traditional in-the-closet PBX is now beginning to be replaced by business phone systems based on voice-over-Internet protocols—or VoIP.

In a few years, a visit from the phone company’s tech guy to work on your PBX is going to be as obsolete as an early-morning delivery from a milkman. New generations of commercial real estate executives—or any employees in a typical American office—might go to work, do their job and return home without ever knowing that the company’s communications lifeblood used to be routed through an incomprehensible mass of switches and wires located in an out-of-the-way closet somewhere on site.

Traditional in-the-closet PBX is now beginning to be replaced by business phone systems based on voice-over-Internet protocols—or VoIP, to use the ungainly acronym invented by this new industry. The move is part of a much larger migration of telecommunications services from the public switched telephone network, or PSTN, to VoIP. While it has been underway for a few years now, most users have been individual households, with their relatively simple telecom needs and higher tolerance for service that is not quite perfect. Businesses were more reluctant to make such a fundamental change. But VoIP has become sophisticated and reliable enough for business use.

Complicating matters for the business user is the fact that there is no agreed-upon terminology for business-oriented VoIP telephony. “Cloud” PBX is perhaps the most common of them, inspired as it is by “cloud computing” and generally referring to a phone system accessed via a broadband connection to the Internet. A cloud PBX exists entirely off site “in the cloud,” which is simply a metaphor for a network of servers. Sometimes this arrangement is also known as a “virtual PBX” or a “hosted PBX.”

To complicate matters still further, it is possible for a VoIP PBX to be on site at a business, just as old-fashioned switches-and-wires PBXs are. In that case, a company owns and maintains its own server, or a group of servers, to provide phone service. That kind of PBX architecture is more suited for large companies with their own IT capabilities. For the purposes of this article, however, “cloud PBX” will refer to the kind of phone service provided off site through the Internet, which is a relatively new option for companies.

For commercial property managers, the advent of VoIP telephony will mean the end of devoting space to old-fashioned switches-and-wires PBXs—which in larger building complexes might be considerable, along with the resources needed to maintain them (such as HVAC to keep temperatures stable). Also, as computing power grows less expensive, on-site VoIP PBXs may become a more common building feature, possibly even a standard amenity that buildings can use to attract incoming tenants, whether as a primary system or backup to off-site VoIP via broadband connection.

Cloud PBX Features

Cloud PBX fulfills much the same business function as a traditional on-site PBX, connecting a company to itself and to the outside world via an internal telecom system. After all, the initials originally stood for “private branch exchange,” dating back to the age of copper wire-based telephony. Cloud PBX does this function—and more—but entirely through a broadband Internet connection.

“Cloud PBX for business is still in its nascent stages, but almost at an inflection point,” said John Guillaume, vice president of voice and UC (unified communications) services for Comcast Business Services. “We don’t need to push the service as much as we used to. Business customers are now more aware of cloud PBX and are starting to ask about it.”

Naturally, purveyors of cloud PBX systems are quick to point out their systems’ advantages to would-be business customers. A main selling point is that missing in-the-closet PBX system and the related expenses of setup and maintenance. Cloud PBX has its own costs—VoIP does not mean free telephony—but for small to midsize companies, it tends to be more modest than paying for one’s own physical PBX, or even a share of a physical PBX. A recent survey by PBXCompare.com put the cost of a “market standard” corporate cloud PBX at $100 a month, with extra charges for adding extensions above a certain number (100) and receiving inbound minutes over a certain number (2,500).

Any cloud PBX worth its salt also offers a good deal more than the standard telecom features that have been around since at least the 1980s, such as voicemail, call forwarding and call transfers. One aspect of cloud PBX’s usefulness is the ability to interact with the system online, where users can access voicemail, call logs or a menu to direct incoming callers through a dial-by-name directory. Moreover, users can forward calls or voicemail anywhere else—including other offices in other cities, but also including any other phone system. But perhaps the most popular cloud PBX feature, and certainly a useful one among those commercial real estate companies whose employees need to be mobile, is one known as Follow Me/Find Me.

“It’s very popular,” said Guillaume. “Our customers who have it say they don’t know how they got along without it.”

Follow Me is really just a sophisticated automatic call-forwarding function in which the PBX system is set up to try a series of phone numbers for a single person—that person’s office phone, cell phone, car phone, home phone and so forth—until the user is reached. Find Me, which complements Follow Me, allows a user to take a call at any location. The upshot of the new cloud PBX features is the further erosion of the distinction between the office and everywhere else—or, to put it more positively, the ability to be mobile and still be productive.

Picking the Right Cloud PBX

The choice among cloud PBX providers is now quite large, since companies eager to get into the business have proliferated like dandelions in the spring, each offering an array of options and pricing structures. “Ultimately, when small or midsize organizations evaluate a new IP PBX system, it comes down to ease of use for both the administrator and the actual employee who is making calls,” advised Dusan Vitek, vice president of marketing for Kerio Technologies, an IP PBX vendor.

Cloud PBX systems make it possible for even small and midsize businesses to have all of the features and capabilities of Fortune-500 type phone systems, asserted Greg Brashier, COO of Virtual PBX, another vendor. But it has also made for a potentially bewildering array of options—something like the proliferation of retail cell phone plans.

“Essential things to look for are ACD (automatic call distributor) queues to spread incoming calls across several users, rather than requiring callers to dial extension numbers—what if the caller doesn’t know an extension number?—inclusion of Internet fax services and plans that fit your budget,” Brashier said. “Sometimes a flat-rate plan is more than necessary, while for other companies, it’s essential. You should also look for specific features that are important, such as call recording capabilities or conferencing.”

One example of a real estate-related firm that made the transition to cloud telephony is the McLean, Va.-based McKissack & McKissack, an architecture, engineering and construction firm with operations in various parts of the country employing about 150 people. When the company won a contract to manage a $100 million annual construction and rehabilitation budget for the U.S. Department of Labor’s Job Corps Contractor Support Center—a sprawling assignment that involves construction, renovation or demolition of more than 120 job centers nationwide—it decided the time was right to upgrade its telecommunications. It hired iCore Networks, a Washington, D.C.-based VoIP specialist, to do the upgrade.

“Over 40 percent of the JCCSC workforce is on the road and working between multiple job sites,” observed Carl Bunche Sr., vice president of special projects at McKissack & McKissack. “As the program management contractor, one of our responsibilities is to ensure that the JCCSC staff has access to voice and data. We’ve successfully converted to VoIP, and since then we’ve witnessed remarkable improvements in communication and collaboration.”