It may be that e-business is the wave of the future, but using the old-fashioned phone is still smack-dab in the present. Trouble is, with so much Internet dependency, most businesses must support and maintain both a phone network and an Internet network, neither of which is simple, or cheap.

But today, if you're in the market for a phone system, you do have options for keeping things streamlined. Several out-of-the-box appliances allow small businesses to manage both their Internet and phone traffic through the same network. The buzz term you'll notice in reference to them is IP PBX, which officially stands for Internet Protocol - Private Branch Exchange.

How is IP PBX different from a traditional phone system? Well, PBX refers to one of the two most popular traditional systems. The other is a "key" system, and is more suited to smaller businesses than PBX, though some businesses use a hybrid of the two. Both systems are usually proprietary, separate from computer networks, and professionally installed. Plus, ongoing maintenance and troubleshooting can often require additional costly visits from the vendor.

An IP PBX, on the other hand, can be managed concurrently with the same network that routes your Internet-related data, and the software typically works with multiple operating systems on any brand of computer. They're sold by telecommunications and networking solutions providers like 3Com and Lucent, and upgrades can be downloaded from the Internet straight onto your system.

And adjusting the system won't require scheduling appointments with your vendor. Instead, you use a desktop computer. Adding additional voice mail boxes or sophisticated features like caller ID or an auto attendant (which supports a receptionist by "answering" or routing calls that don't require live-person intervention) is all done via your trusty mouse.

You can even inexpensively link your phone system functions to your desktop computer applications (a technology known as CTI, or computer telephony integration). For example, customer info -- name, order history, charge card data -- can be displayed immediately on your monitor before a call is even picked up. CTI also allows outbound calling from PCs by simply clicking on a name in your contact management program.

But IP PBX systems don't run cheap. For a company of around 50 employees, price per station (working phone) will average you around $600 - about the same as installing a regular PBX system.

Keep in mind, however, that using IP PBX allows you to manage not only voice but Internet data as well. For small businesses with limited IT staff, managing only one network could add up to long-term savings.

Sales for phone systems using PC-based technology are expected to reach a whopping five billion dollars in revenues by 2003, according to Cahners In-Stat Group. That's up from $300 million only last year.

But whether diving into this market is right for your business depends on your specific needs. Before making any decisions, it will be worth the extra bucks to spend a few hours with a consultant to help you evaluate your options. The last thing you want to do is spend thousands of dollars on a system that's all wrong for your business.

Quick tips

Get a free LAN setup. Don't already have a local area network? Some vendors will help you set one up, free of charge. But you will have to cover the cost of equipment. Don't use Windows? Watch out. Many IP PBX appliances are run with Windows NT. Look for an appliance that has a system that works independently of any particular OS. Get IP telephony. Have two offices in different parts of the country or world? Set up an appliance in each office to make free calls to one another via your Internet connection.