Come Together

Is it time to combine your voice and data networks? We've got the latest buzz on IP-PBX phone systems.
Magazine Contributor
4 min read

This story appears in the January 2005 issue of Entrepreneur. Subscribe »

You've had enough of this separate network stuff. You've heard about the savings and convenience that accrue when voice and data traffic travel over the same in-house IP PBX and then out over the internet or traditional phone lines.

Maybe it's time to upgrade your old analog phone system anyway. If you're tired of supporting separate voice and data networks, a well-implemented IP PBX promises savings in hardware, training and maintenance. There's also the potential for additional productivity from unique and easy-to-use calling features.

Finding the right IP PBX for you, though, can be a little work. You're bound to run into a wall of terminology like "circuit-switched trunks," "stand-alone gateway" and "TDM support." That's why your in-house IT expert, or an outside IT consultant, should handle most of the qualifying and installation. You still need a good idea of what systems are out there and how they differ.

PBX refers to Private Branch Exchange, the traditional small-business phone system that allows for direct internal dialing. The digital version is, essentially, a heavy-duty server that sends voice and data packets over Ethernet cable. IP refers to VoIP-the ability of these phone systems to send calls over the internet as well as traditional phone lines. So far, so good.

Pricing varies widely. Larger installations have a lower per-employee cost, but the feature set you choose will have an impact on your price tag. Saied Seghatoleslami, vice president and general manager of the Small and Medium Business Solutions Group for Avaya, says that Avaya system pricing generally ranges between $500 and $800 per seat. Those prices, which include the cost of adding IP phones, are fairly typical for IP-PBX installations.

Unique features of an IP-PBX system include find me/follow me, teleconferencing, in-office extensions for remote workers, and unified messaging-a shared mailbox for voice mail and e-mail. Some other feature sets are geared to call centers, and mobile workers can take advantage of IP softphones when they're on the road or working from a home office. A major cost savings with IP PBXs is that they can be easily scaled up without technical help if you want to add users or features as your company grows.

Manufacturers like Cisco Systems specialize in the software side of IP PBX, while others like Avaya provide the whole system. The actual hardware you'll need to invest in can vary. Smart network design and attending to details like purchasing a proper UPS battery backup are important to tackle from the outset. A good, local VAR can offer a variety of solutions that fit your needs.

Checking into an IP-PBX system makes sense for businesses that are opening a new office or upgrading an established one. Fast-growing businesses, especially those with more than one location, can take advantage of the flexibility of an IP PBX.

Our "Shopping List" features some major IP-PBX players, how to get in touch with them, and one product from their lines that's geared specifically to growing businesses. Visit their websites, or check in with your VAR or IT staff to get up to speed on the nitty-gritty. If you're set on a particular manufacturer, they'll be able to point you to a reseller in your area. With a little background knowledge, you can help steer your company to a smart IP-PBX purchase.

Shopping List
To find the best IP PBX, think about how many users you'll have to support.
(800) 995-2612
OmniPCX Office comes in a variety of configurations, depending on your needs.
The AltiServ1 IP is geared for 8 to 50 users.
(866) GO-AVAYA
IP Office serves 2 to 360 stations; Small Office Edition for up to 28 users is also available.
(800) 2400-NEC
NEAX 2000 IPS supports up to 500 users.
(800) 4NORTEL
Business Communications Manager handles 10 to 200 stations.
(800) 765-6123
HiPath 3300 Real-Time IP System supports up to 96 IP users.
(800) NET-3COm
The NBX 100 supports up to 200 devices.

More from Entrepreneur

Get heaping discounts to books you love delivered straight to your inbox. We’ll feature a different book each week and share exclusive deals you won’t find anywhere else.
Jumpstart Your Business. Entrepreneur Insider is your all-access pass to the skills, experts, and network you need to get your business off the ground—or take it to the next level.
Are you paying too much for business insurance? Do you have critical gaps in your coverage? Trust Entrepreneur to help you find out.

Latest on Entrepreneur