Phone Systems Buyer's Guide

Types of commercial phone systems

By Sylvia Rosen

Traditional business phone systems come in three basic configurations: key system units (KSU), Private Branch Exchange (PBX) systems, and KSU-less phones. The type of system you choose will depend on how many stations (extensions) you need and what features you require.

PBX systems

If your company has more than 40 employees, or if you need advanced functionality, PBX systems are the best solution. PBX systems use dedicated telephone hardware and switches to handle and rout calls. They are traditionally stored in a telecom cabinet at your office; however, the technology has progressed to the point where a powerful PBX for a small company can sit unobtrusively on a desk.

Most PBXs come standard with all the office telephone features you might want. In addition, they are totally programmable, so they can support even the most complex implementations. You'll pay a premium for this flexibility, but in many cases the price difference between a PBX system and less adaptable solution is smaller than you might expect.

Key systems

In the 5 to 40 employee range, key systems are more typical. This type of phone system uses a central control device called the key system unit (KSU) to provide features that are not available with ordinary phones. For example, a central unit can allow users to make calls between extensions and prevent users from accidentally picking up lines that are in use. Modern key systems do provide standard business features, but may be less customizable in some cases.

While there are technical differences between key and PBX systems, the distinctions to a user have become relatively blurred. Many key systems include features that were once available only on PBXs, and some systems operate internally as either a key or a PBX depending on the software that is installed. The term "hybrid" is often used to describe business phone systems that resemble both key and PBX systems.

Both key and PBX telephone systems require professional installation and maintenance. All outside telephone lines must connect to the KSU or PBX cabinet, as well as all inside extensions. Unfortunately, configuring and wiring these phone systems can be nearly as costly as the phones themselves. You will almost always be able to use existing phone wiring. (Need new wiring run? Read our Cabling and Wiring Buyer's Guide.)

Don't expect to continue using your existing phones, however. Unless the phones you have are relatively new, they probably won't be compatible with the central unit and you'll need to purchase new handsets.

KSU-less systems

If your company has fewer than 10 employees, you may be able to meet your telephone needs with a KSU-less system. For a much lower initial investment, KSU-less phones are designed to provide many of the features of smaller commercial phone systems in a decentralized manner. The phones themselves contain the technology necessary to allow them to communicate with each other without requiring a central cabinet.

KSU-less systems are not permanently wired into your office. These phones can easily be unplugged and moved to a new location or sold. This allows you to treat a KSU-less system like any other business machine rather than as a permanent investment in your premises.

Make sure any KSU-less system you are considering is compatible with the type of telephone wiring used in your office, as well as accessories such as answering machines and modems. Because they are so inexpensive, KSU-less systems are not usually sold or supported by telecom vendors - you will need to do the shopping, installation, programming, and maintenance yourself. And they are also more susceptible to "crosstalk," a problem in which separate conversations bleed into each other. With hybrid key systems dropping so far in price, KSU-less systems present more risk than they are worth for most businesses.

Regardless of the size of your company or the type of phone system you select, make sure you investigate what different vendors can offer your business.

VoIP Phone Systems

In addition to traditional business phone systems, there are systems that use voice over the Internet protocol (VoIP) technology to let you make and receive phone calls using your broadband Internet connection and special IP enabled telephones. For some businesses, VoIP systems can provide significant cost savings and other benefits.

There are two varieties of VoIP business phone system. An IP PBX is a piece of hardware which is installed at your office and functions much like a traditional PBX or key system. A hosted business phone system, on the other hand, processes calls at a data center before forwarding them to a direct extension at your office or other location. You can learn more about these systems in our VoIP Phone Systems Buyer's Guide and our Hosted PBX Phone System Buyers Guide .