Telecoms 101 – An overview of the industry, how it has changed and what new technologies are available.

The analogue telephone was invented by Alexander Graham Bell in 1876. Telephones communicated through various exchanges or switchboards which were manually operated. The exchanges served specific geographic areas.

The technology did not advance much in the next 100 years except the adoption rate. I remember calling neighbouring farms using a party line on my grandfather’s farm in the late 1970’s with a Pendulum Telephone.

Automation of the switchboards led to the introduction of the Public switched telephone network (PSTN). Telkom still operate South Africa’s only fixed line PSTN. This allowed tone dialling instruments to communicate globally by dialling a number.

This led to the introduction of Private Automated Branch Exchange (PABX) or Private Branch Exchange (PBX). It is a business telephone system that performs call processing duties in an office with multiple telephone lines (trunks) and multiple handset telephones (extensions). The call processing duties of the PABX include: Establishing, maintaining and disconnecting a connection between two telephones, and providing call accounting information about the call.

PABX systems offer the following features of which some are optional extras:

  • Auto attendant or welcome message to greet and direct callers automatically
  • Automated directory where callers can be routed to a specific extension by typing or speaking the letters of the user’s name
  • Automatic call distribution (ACD) where the system automatically routes calls based on criteria like number dialled, caller id, time of day or route selection
  • Automatic call back
  • Call forwarding on busy or unavailable
  • Call pick-up
  • Call transfer
  • Call waiting
  • Conference calling
  • Direct inward dialling (DID) to an extension
  • Do not disturb (DND)
  • Find me follow me: Allows a user to have multiple phones connected to the PABX and the system will find the extension you are available on or present your voicemail to the caller
  • Music on hold
  • Night service
  • Paging via an external paging system or the speaker phones
  • Voicemail

The PABX evolved in the 1980’s with the introduction of digital telephones and Digital Enhanced Cordless Telecommunications (DECT) cordless telephones. Digital phones offer better security between the phone and the PABX and more information is passed between the phone and the PABX e.g. Caller Line Identity, feature codes and extension availability.

The 1990’s saw the introduction of IP Telephony. IP Telephony is voice communication over a data network. The traditional PABX manufacturers added IP Telephony functionality to their existing Analog/Digital PABX systems (called Hybrid PABX’s) and some pioneering manufacturers produced pure IP Telephony systems. IP Telephony introduced us to the soft phone whereby a PC with a headset can be used as a phone. Some IP Telephony systems are hardware based with all the call processing happens on a physical appliance and others are software based whereby the software can run on a file server or a Virtual Machine (VM). Asterisk PBX is a Linux open source software-based PBX created in 1999. The Asterisk software is embedded in many commercial, free and proprietary IP PBX systems. It supports open standards for voice communication e.g. Session Initiation Protocol (SIP) which allows any standards-based SIP device to use the PBX. This means your organization is not locked into using a particular brand of IP handset and drives the cost of IP handsets down.

The advent of IP Telephony, the increasing throughput of the internet and the declining cost of the internet paved the way for Voice over IP (VoIP). VoIP is simply voice calls made over the internet. VoIP calls can be made between offices at only the cost of the bandwidth and using a VoIP provider calls can be made to any geographic or non-geographic number. VoIP providers in South Africa like uVoice charge between 30% and 60% less than Public switched telephone network (PSTN) providers for calls and calls between your sites on VoIP are free of call charges.

IP Telephony and VoIP also enabled Unified Communications (UC). UC is the integration of communication services such as instant messaging (IM or chat), presence information, extension mobility, voice, audio, web & video conferencing, data and desktop sharing. The components of UC may include a combination Web conferencing services, on-premises video conferencing systems, collaboration tools like Microsoft Office 365, IP Telephony systems and Hosted PBX systems.

With the global trend for organizations to focus on their core businesses instead of expending resources on computer infrastructure and maintenance, organizations are opting for cloud computing services. VoIP, stable and quick internet connections make it possible to provide cloud PBX services to your organization. These services are referred to Hosted PBX, Cloud PBX or Virtual PBX services. This is a move away from a Capex based on-premises PBX service to an Opex based off-site PBX service. Organizations able to port their telephone numbers to the Hosted PBX provider and keep the number indefinitely. This enables the cancelling of expensive traditional Telco lines and presents the opportunity to pay between 30% to 60% less for calls.

Looking to the future there is a place for traditional/Hybrid PABX’s, IP Telephony and Hosted PBX services dependant on where the office is situated nearest to a support centre, the stability of the telephone lines, the availability of a high-speed internet connection and the features that are required i.e. just dial-tone vs call centre functionality.

PBX – 101- What is PBX, how does it benefit your business, how do you get started

A PBX (Private Branch Exchange) is a telephone exchange/system that is privately owned and controlled. The PBX combines several external lines (PSTN) and internal extensions allowing them to communicate with each other. Internal extension users can call each other at no charge by dialling the allocated extension number while not using an external line. The PBX also manages the shared use of the external lines with the extension users.

The main functions of a PBX are to:

  • Allow internal users to communicate with each other via the telephone extension
  • Deliver inbound calls from the advertised phone number with multiple lines to the extensions.
  • Manage the routing/dial plan of outgoing calls from multiple users via the PSTN lines
  • Provide information to management via accounting reports.

Some benefits and features of a most PBX system

  • Hunting lines allow for multiple incoming calls to be routed concurrently
  • Auto Attendant automates the call routing process by allowing callers to choose the department they wish to speak to without having to speak to an operator.
  • Telephone management software allows costs to be monitored and centrally managed remotely or on site.
  • Barring of certain extensions from dialling high cost destinations
  • Direct inward dialling (DID) provides direct calls to be received to an extension from an external caller without having to go through a central switchboard operator.
  • Automatic ring back takes place when an extension user tries to contact another extension that is busy on another call, and automatically calls them back when they become available.
  • Night service puts the PBX into a predetermined mode such a voicemail, welcome message, call forward to mobile, or it can ring on desired extension numbers.
  • On hold music boosts the image and professionalism and makes the on-hold time for the caller more pleasant.
  • Voicemail gives each extension their own voicemail box with a personalised message.
  • Speed dials provide extension users with access to a short code list of most frequently dialled numbers (usually customers, suppliers and staff members mobile numbers)
  • Conference calls allow several internal and external participants to connect to a phone call simultaneously from either a conference phone or extension phone.
  • Call pick up facility means one can pick up another phone that’s ringing by dialling a short code without having to get up from your desk.
  • Some extension users make use of the Do not disturb function (DND) while in a meeting or when they cannot be interrupted by a phone call at that particular time.
  • Public Address (PA Systems) integrate into PBX systems which means people can speak from their handset (with a short code) and it broadcasts through the speakers of the PA system.

Traditional lines that can connect to a PBX system

Analogue/Junction– A single copper cable that is installed into the building by the Telco line provider
Basic Rate ISDN (BRI)– A basic rate ISDN line provides two channels, which can be used for two calls, which is the same as having two standard analogue lines. The Telco provides the option to apply for 20 direct numbers per ISDN line
Primary Rate ISDN (PRI)– A primary rate ISDN line provides thirty channels, which can be used for thirty separate calls, which is the same as having thirty analogue lines. The Telco provides the option to apply for 200 direct numbers per ISDN line

Traditional extension types that can connect to a PBX system

  • Switchboard Phone showing multiple line and extension buttons indicated via LED lights
  • Executive phone with display, speaker and extension buttons indicated via LED lights.
  • Conference phone
  • Basic Analogue Desk phone
  • Analogue desk phone with speaker and display
  • Cordless phone (DECT Phone)
  • Answering machine
  • Night bell/Factory bell


There are still a significant amount of analogue/digital traditional (hardware-based) PBX systems in use. The latest PBX technology is an Internet-Protocol Private Branch Exchange (IP PBX) which uses the internet to route calls while providing the same features as a traditional phone system. This new technology is called Voice over Internet Protocol (VoIP).

An IP PBX can still be on premise/on-site or the PBX can be located at an off-site datacentre (Hosted/Virtual/Cloud PBX). IP PBX Systems are software based which provides substantially more features and functionality:

  • More cost effective to support with less reliance on the vendor for minor moves, adds and changes.
  • Low-cost outgoing calls due to wholesale call costs from the VoIP supplier.
  • Free inter branch calling across with extension-to-extension dialling.
  • Ability to port multiple telco lines with savings on fixed line rental charges that fall away
  • Scalable and flexible due to its software-based nature and ease of growth or shrinkage.
  • Comprehensive and central management of phones via web front end
  • Call recording available from within the software (no 3rd party involvement required)
  • Voicemail and auto attendant messages built in.
  • One extension can ring in multiple locations
  • Mobility for workers to work from remote locations connecting to the PBX
  • PBX extension phone functionality on a Smart Phone via an App.
  • One set of network cabling to run the data network and voice network
  • Geographic, Non-Geographic, Toll Free and International Numbers can be generated
  • A conference bridge allows multiple people to participate in a group call. Users dial an extension number and announce themselves (often pin code protected) to join the virtual meeting room.
  • Open Standards reduces “vendor lock-in” with higher ROI.

Things to consider before purchasing a phone system:

Ask Yourself:

  • What do we have in place currently and are we still in contract?
  • What functionality/requirements are non-negotiable?
  • Do we want to rent or own the equipment?
  • What are our current costs?
  • What is our current system not offering us?
  • What is our expected growth in the next 3-5 years?
  • Do we have to conform to a legal obligation based on our industry?
  • What do we ultimately want to achieve with the new phones?
  • Do we want to keep our Telco lines?
  • Do we want a traditional or IP system?
  • If we want IP, do we want the PBX on-site or in the cloud?

 What to ask potential service providers

  • What kind of system/software/hardware does your system run on?
  • Are there annual fees for maintenance?
  • What costs are involved to expand and what are the limitations?
  • What is your turn around time from order to installation?
  • What redundancy measures do you suggest?
  • Why is your phone system different to your competitors?
  • What features are excluded in the PBX?
  • How is your system going to futureproof our investment?
  • Tell me about your SLA and your project plan for the installation?
  • How do you plan to train our staff?
  • Could you demonstrate how your system works before we proceed?
  • What are your upfront and recurring costs?
  • Which companies use your system at present?

What service providers may ask you:

  • How many branches do you have and can we get copies of telco invoices/contracts?
  • How many extensions do you need and what phone type ie desk/cordless/reception?
  • What type of cabling/network infrastructure do you have?
  • What type of internet link do you have and what are the speeds/contention?
  • If you have multiple sites, how are they connected and is it working for you?
  • Tell us about your current phone system?
  • Do you have any feature requirements? Which features are most important?
  • Do you prefer owning or renting telephony equipment?
  • Do you prefer a hosted PBX (cloud-based phone system) or a premise based (on-site) solution?
  • Do you outsource or insource your IT function?
  • Why are you leaving your current service provider?
  • Do you have telephone numbers that you would like to port to our network?
  • How important is redundancy/failover for you?
  • Do you expect more than 30% growth in the next 3 years?