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Private branch exchange

(also PBX)

Private branch exchange definition

A private branch exchange is an organization’s internal telephone system. A private branch exchange allows users to make calls within the organization and to external numbers, such as public telephone lines and mobile networks.

The first private branch exchange systems relied on special hardware setups, but the technology has evolved over time to incorporate software-based and cloud-based solutions.

See also: internet telephony

Types of private branch exchanges

  • Hardware-based private branch exchanges function primarily through physical equipment, such as telephony cards, wiring, and control units. These systems are typically located on the organization’s premises.
  • Software-based private branch exchanges run on standard server hardware. They can be managed and configured through software interfaces.
  • Cloud-based private branch exchanges (also known as hosted exchanges) are maintained by a dedicated service provider and accessed over the internet, eliminating the need for any on-site hardware.

Major private branch exchange functions

  • Call routing: The primary function of private branch exchanges is redirecting incoming calls to the appropriate destination based on predefined rules. For example, calls can be routed to specific departments or individuals based on the dialed extension or a menu selection.
  • Internal communications: Private branch exchanges let organizations assign internal extensions to users or departments. This setup lets employees call each other cheaply, even when they’re working in different countries.
  • Call handling: Modern private branch exchanges offer a range of call handling features, such as call forwarding, call waiting, voicemail, conference calling, and interactive voice response (IVR) menus.