PABXCommunication systems play a major part in the operations of most offices around the world. Regardless of the size of the company, a working internal communications system that allows workers to seamlessly connect without relying on external factors is usually one of the first things installed in new corporate headquarters and small business offices alike.

Back in the days before the internet, business communications was handled pretty much only by installing traditional landline phone systems at the office premises, with tens of meters of cables connecting the stationary phones in order to ensure smooth and quick connectivity. These systems were vulnerable to many external factors, though, such as power outages on the provider’s end and the hiking up of prices by telephone service providers.

Most business communications capabilities are made possible by implementing private branch exchange (or PBX) systems.Traditionally, it required a room of operators to manage the company’s employees’ calls and transfer them via analog methods. These people also had to handle all of the communications coming in from the outside and put them through to the right people.

All of that changed with the arrival of PABX – the Private Automatic Branch Exchange method. It has drastically reduced communication costs for businesses, as well as improved upon the systems’ interconnectivity and response times. After reading this article, you’ll know the main differences between PBX and PABX, and how you can implement these solutions in your own business.

What Is PABX (Private Automatic Branch Exchange)?

We’ve already established that PABX stands for Private Automatic Branch Exchange. But what does that terminology actually entail? What are some of its major features? As PBX technology improved and the operators moved away from manually transferring calls to being able to do so at the press of the button, these changes warranted the development of a new term describing phone systems in most offices.

PABX-enabled phones have entirely eradicated the need for operator rooms, as the same functions could have been carried out at the press of a button on the same phone that the outgoing call was coming from. PABX users can make free internal calls. Initially, these solutions were prohibitively expensive. Traditional PBX systems remained in use while improving upon the original method reliant on switchboard operators. With time, electronic switching for call forwarding or call transfer became the standard in most offices, even those without a fully automated PBX.

How Exactly Does a PABX System Work?

Private Automatic Branch Exchange (PABX) was made possible by the arrival of the capability to electronically switch between calls without the need for manual operators. This advancement was the key to developing a telephone system that would completely do away with the need for hiring people to do the menial task of answering and transferring incoming calls.

Without getting too much into the technicalities, PABX systems, in their most basic version, make use of extension numbers, which are assigned to each individual phone in a given office. For example, if you’d like to make a call to one of your co-workers who’s in his office next door, the only thing you’d have to do was type in the extension number on your PABX-enabled phone, and the call would directly go through to the receiver.

Private Automatic Branch Exchange (PABX) systems have fixed that by removing the middlemen (operators) while keeping the structure of PBX systems intact. Phone extension numbers remained, but the switchboard was replaced with buttons placed directly on the telephones themselves, allowing any employee to carry out internal phone calls without waiting in the line for what sometimes felt like an eternity. Modern PABX systems make use of IP-based phones, and companies providing these services often base their entire functionality around internet connection, removing the need for installing phone lines altogether.


PABX: Most Important Features

In our increasingly interconnected and interdependent world, the need for fast, reliable connectivity should be prioritized above anything else. This is especially important in business environments, where minutes (or even seconds) of hesitation or lengthy session initiation can end up costing thousands of dollars.

An increasing number of companies have been utilizing voice over IP (internet protocol) technology to achieve the best results possible. It may be difficult to make a decision regarding the right communication service for your business without understanding its main features.

Some of the main characteristics of a modern PABX system include:

  • Effortless call transferring
  • Constant connectivity independent from any phone service provider
  • Using VoIP for the best call quality possible
  • Adjustable to the needs of your business

Some advanced features of modern PABX system:

  • Auto Attendant
  • Call Recording
  • Conference Call
  • Voicemail
  • Call waiting

PABX vs. PBX: What’s the Difference?

Nowadays, the terms Private Branch Exchange (PBX) and Private Automatic Branch Exchange (PABX) are used almost interchangeably. This is because PABX has proven to be superior to the old-school PBX systems, and with the decreasing costs of high-speed internet connections, it simply makes more sense from a financial standpoint. Yet in terms of how they originated, there is actually a difference between them.


This is the “legacy” system that replaced POTS in the majority of offices in the second half of the twentieth century. It is based primarily on landline telephony and uses switchboard operators to connect calls within and into the private branch.


  • Much more efficient than a plain old telephone system.
  • Removed the need for installing as many phone lines.


  • Human operators are less efficient.
  • Long waiting times.
  • Lack of any additional features.
  • Completely reliant on landline telephony.


As technology progressed, businesses began looking for more advanced communications systems that would catch up with all of the innovation going on, not to mention the mobile revolution we’re still witnessing today. The first PABX systems allowed users to connect by using buttons on their telephones and dialing extension numbers. As the internet started taking over as the primary communication tool, VoIP PABX systems became the most popular solution, offering advanced features and benefits that were simply not possible in the past.


  • Removes the need for installing complicated landlines.
  • VoIP enables nearly instant connections.
  • One PABX system for all branches of one company, even internationally.
  • Softphones that can be installed on mobile devices and computers.
  • Extra efficiency-improving features.


  • Requires a good, stable internet connection to work, which may be a problem in certain regions.

Yeastar Solutions for Your Unified Communication Needs

Private automatic branch exchange (PABX) systems, just like any other product or service, come in all sorts of shapes and sizes. Not all of them will fit your business like a glove. Yeastar services are incredibly versatile, making our PABX offer one of the broadest ones in the industry. You can choose between an on-premises VoIP PABX system , granting you the ultimate and complete control over the unified communications at your office. On the other hand, if you prefer a more hassle-free approach, our cloud-hosted PBX system is the perfect solution for businesses of all sizes who want a reliable UC service without having to worry about equipment maintenance.

Regardless of the service you end up choosing, selecting Yeastar as your unified communications provider will ensure a long-lasting, reliable way to improve and maintain seamless connectivity in your office.

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