Is cloud communications making the office PABX obsolete?

Posted by Johnny Kromer on 31 Oct 2018 11:00:00 AM

In our ever-changing world analogue systems are becoming obsolete thanks to digital advancements, but will the PABX system even die?

The Private Automated Branch Exchange (PABX) has been a very useful business tool for the world. It gave organisations the ability to hold calls within the same network at minimal cost, saved us from having to hike to the next office just to get clarification on that memo, and if you were inclined, the switchboard made you feel like you were on Captain Kirk's Starship Enterprise.

Star trek and pabx

Image from Wikia.

Like most technologies, PABX's only got better with time. The hardware maintenance and operations costs of PABX's reduced over time to the point where they are no longer limited to big corporations. The PABX gave users the ability to efficiently manage external (trunk) lines (connected to telecom providers like Telcom, Vodacom, and MTN) without affecting the internal lines with features like routing calls, automated messages, call recording, IVR (interactive voice response)/ auto attendant and time of day routing.  

They have had a good run but over time analogue PABX's that run on Plain Old Telephone Services (POTS) have become less efficient because of the old tech they rely on. Fortunately, clients that want the benefits of PABX's no longer need to have the copper wiring and the physical hardware of yesteryear, they simply need internet broadband services to access a cloud communications system. The transition hasn't been absolute - some are still moving towards cloud communication systems, while others are sticking to their analogue on premises PABX’s. Users stick to on-premises PABX’s not necessarily because it is better tech, but because it would be disruptive and it would mean losing out on their investment in the analogue system. Nonetheless, it has become harder and harder to deny the benefits of a cloud communications system. So much so that some companies choose to have a cloud system in one location as part of a hybrid cloud communication system which then expands gradually to other locations and eventually phases out on-premises analogue PABXs.

Advantages of cloud communication

Using cloud communication, any device with an internet connection like a laptop, tablet, and smartphone can become a potential phone which means they can make calls on the Public Switch Telephone Network (PSTN), extension dial, video call, and manage voicemail. The cloud communication system also helps with team collaboration with features like:

  • real-time presence
  • instant messaging
  • call analytics
  • click-to-call functionality

Cloud communications capabilities are mostly determined by your provider. Cloud communication fits in well in this era of business communication where employees always need to be in contact with the organisation as it enables them to communicate at any time and from any location like at home after work hours. The ability to onboard just about any smart device is one of the key abilities that distinguish it from on-premises PABXs. In contrast, on-premises analogue PABXs need upgrades to connect with smart devices and at times simply do not have the capabilities to connect every device.

Telecom providers like Telkom used to provide both analogue and digital trunk communication, but are now following a worldwide trend to phase out analogue. This is because the world is moving to using Session Initiation Protocol (SIP) trunking. The old fashioned PABX cannot handle SIP although there are newer PABXs that can handle SIP communication, cloud communication systems on the other hand can handle SIP effortlessly since they can easily be updated and your devices merely have to connect to access the latest tech. SIP trunking is a lot cheaper and efficient than analogue or digital trunking.

Not only do on-premises PABX’s struggle with smart devices but they can also present problems for connecting communication systems in different locations. This is more evident for organisational branches who's on-premises PABX’s may not be compatible with each other, mostly because they use different systems, equipment, or have different capabilities. Syncing PABX’s in different locations can be a complicated exercise for the IT department. This is another reason IT professionals prefer cloud communication over PABX’s because unifying communication systems in different location is so much simpler. With cloud communication, every user in every location on any device uses the same platform.

PABX’s are increasingly complex

In South Africa, PABX’s are still prevalent especially in the small and medium sized enterprises. This has a lot to do with pricing. For example, an analogue phone is approximately R150 while an IP phone can be anywhere around R600. Although companies used to favour analogue PABX’s single payment cost structure, it has gotten more complicated over the years. PABX's are no longer a fixed investment with long periods between replacement and upgrades. The pace of technology has necessitated the need to replace hardware or conduct major software upgrades in shorter and unpredictable time periods. Even the best laid budgets are getting strained by these unexpected expenses, like during an upgrade of an integrated system and you find that there are compatibility problems and are forced to upgrade the hardware as well. Another problem with on-premises PABX’s is that they are not easily scalable, if the business experiences sudden growth it will be faced with a system that can only be scaled up in large blocks.

There are organisations that have had a functioning on-premises PABX system for decades and are reluctant to change. A lot of these organisations will find themselves in a difficult situation when the resident experts retire, there are fewer and fewer on-premises PABX experts in the market. This is one of the factors that will force organisations to change to cloud communications over time. Frankly speaking, few if any organisations can afford to keep PABX systems specialists on their payroll, and the person or people responsible for on-premises PABX systems are usually a hodgepodge of IT inclined personnel who are assigned the task of maintenance and upgrades. Their priority is on other tasks and not necessarily the PABX systems, this makes their knowledge and skills on PABXs limited. Should they encounter a complex problem they could easily fall short of expectations.

Cloud communication systems on the other hand have experts in the field handling everything for you, you only have to connect your device and you will access the latest software and applications.

Cloud communications is becoming an attractive option for organisations because:

  • Cloud communication systems are very easy to set up. It's only a matter of connecting devices to the cloud. There is no long waiting period.
  • They do not require physical PABX servers. This eliminates the need to have personnel dedicated to maintaining your communication needs. Cloud systems enable the client to be unburdened as the maintenance will be done remotely.
  • Clouds systems also come with a high level of security that would be expensive and arduous if the client were to go it alone.
  • The cost per user is predictable and to scale. Not only is it easier to scale up but you can do it more cost effectively by only paying what you use. So that means there is no need to guess future use or try to anticipate it by buying extra capacity that will lay unused.
  • Cloud services also come with software updates that are done at the provider's end, the client no longer has to worry about it. Upgrades are also easily accessible through new applications so as the technology advances, the client is not left behind. Cloud communications can experience major changes every three months e.g. Microsoft is continuously coming up with changes and updates. Ultimately, the rate of change in the industry is rapid and cloud communication makes these advancements accessible.
  • The software behind cloud communication can also produce insightful reports on call patterns, agent productivity, call duration and so much more with just a few clicks.
  • Furthermore, cloud communication systems come with high level of reliability and redundancy at a lower cost. Disaster recovery on a cloud communication system is also easier and much quicker. The hardware is not on location, so should anything happen to the physical location of the organisation, they can easily setup in another location.

Cloud communication has cut costs like equipment, maintenance and repair, per minute charges, and per feature charges. The reduction in costs has made enterprise grade services that were the reserve for large corporation more affordable and accessible to small and medium sized organisations. The shift towards cloud communications will largely be driven by lower data costs, cloud communication could dominate the South African market in three years' time especially with services like zero-rated exchange minutes.

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