Hosted PBX systems vs. VoIP: What's the difference?

By now as a business owner or IT oriented individual, you've heard the phrases Voice Over IP (VoIP) as well as hosted PBX. While they share certain aspects, they are not the same. To breakdown the differences that lie between hosted PBX phone systems and Voice Over IP (VoIP) service I will use a basic analogy.

Lets say Voice Over IP service is a motor and hosted PBX systems are like airplanes. An airplane is what we all know as the way to get from point A to B across the country or globe. An airplane must use a motor as a means to power itself into the sky and stay there. Motors are also found in cars, watercraft, trains, buses, helicopters, tractors, lawn mowers, ATVs and a million other things used for many different purposes. This is an important part of the analogy because, like motors, VoIP technology can be used many different ways. For instance, Skype, Vonage, and Packet 8 are all considered Voice Over IP (VoIP) providers; however, the 3 of them offer a completely different menu of products with no similar ties except that they all use a "motor."

Hosted PBX phone systems bring the best VoIP technology has to offer if you're a small or medium business. The hosted PBX systems completely replace and eliminate the traditional PBX equipment a small business would have in its office, creating a virtual environment that is flexible, powerful, and cost effective.