Comparisons8 min read

What is the Difference Between Cloud PBX and VoIP?

is cloud PBX same as the VoIP

Table of contents

In today's digital landscape, businesses continually seek technologies that enhance communication while reducing costs. Two popular solutions, Cloud PBX and VoIP, are often considered. But what exactly are they, and how do they differ?


A cloud PBX is a virtual business phone system hosted over the internet that offers flexibility and scalability. On the other hand, VoIP is a system that transmits voice data into digital data which travels over the internet. After switching to the cloud, 94% of businesses experienced a security improvement.


Using Cloud PBX or VoIP in the company helps to enhance overall business communication. Its working mechanism (i.e., making Internet calls) makes it a cost-effective business communication alternative. Even though Cloud PBX and VoIP terms are interchangeably used, there are certain factors like functionality, scalability, cost, etc.


This blog will introduce the core differences between Cloud PBX and VoIP, highlighting their unique advantages and potential drawbacks. By understanding these differences, you can make an informed decision on the best communication system for your business, ensuring it aligns with your goals and budget.

What is VoIP?

VoIP (Voice over Internet Protocol) revolutionizes communication by enabling voice and video calls through the internet connection. It works by converting analog voice signals into digital packets via packet-switching technology. These packets are transmitted across the internet and reassembled at the destination, allowing seamless communication regardless of geographical boundaries.

How Does VoIP Work?

VoIP technology employs packet switching, where voice data is broken into small packets sent over the Internet. These data packets travel via the most efficient routes. At the destination, data packets are reassembled to deliver the sound. This process reduces transmission costs and improves call quality.

What is Cloud PBX?

Cloud PBX, or Cloud Private Branch Exchange, extends the functionality of VoIP to offer a full-featured business phone system hosted entirely on the cloud. It provides advanced communication features such as call routing, voicemail, and conferencing without requiring physical infrastructure like traditional phone systems. It is managed by a service provider, allowing for flexibility and scalability in business communications.

How Does Cloud PBX Work?

The core of Cloud PBX relies on three key components: VoIP technology, a stable internet connection, and a dedicated service provider. When a call is made from a VoIP-enabled device, the Cloud PBX system instantly converts the voice into digital packets. These packets are sent to the service provider's server and then transformed into sound at the receiver's end, ensuring clear and continuous communication.

Are Hosted PBX and Cloud PBX the Same?

Hosted PBX and Cloud PBX are not the same but are similar. Both are managed offsite by a service provider.


Hosted PBX involves the service provider hosting the call platform and features at their location. On the other hand, Cloud PBX utilizes cloud technology, allowing for greater scalability and flexibility, with most cloud features hosted in the cloud.


Cloud PBX allows more of the service to be managed online, making it easier to adjust as your needs change.

Is Cloud PBX the Same as VoIP: Key Differences

Though Cloud PBX and VoIP are related, they are not the same thing. VoIP calls are made over the internet, whereas Cloud PBX uses VoIP technology.


VoIP provides basic call functionality; however, Cloud PBX is feature-rich and offers many features like Call routing, Voicemail, call conference, etc.




Cloud PBX



Call routing, voicemail, auto attendants, call recording, call conferencing.

It provides the basic functionality of making calls over the Internet.


Uses VoIP technology to operate.

Uses VoIP protocol for transmitting voice data over the internet.


It is highly scalable, as we can easily add and remove users.

It depends on VoIP service providers.

CostLower upfront cost, monthly subscription fee.Potentially lower call costs.


It is a full-featured business phone system.

It is a technology that helps make calls over the Internet.


It is managed by service providers.

It requires technical expertise to set up or manage it.

Benefits of VoIP

VoIP technology offers scalable, cost-effective communication solutions, making it ideal for businesses expanding their operations nationally and internationally. With features like voicemail-to-email and call forwarding, VoIP enhances accessibility and efficiency in business communications.

1. Cost Effective Communication

VoIP is a cost-effective communication solution for businesses. It significantly reduces costs for national and international calls by utilizing internet connections. It benefits businesses with branches in different countries, as it helps make international calls at a cost-effective price range, including features like call forwarding, voicemail, and conference calling at no additional cost.

2. Enhanced Connectivity

Enhanced connectivity in VoIP allows global communication from any location with internet access. It supports various devices, enabling users to make and receive calls on smartphones and laptops. VoIP integrates with other communication tools and collaborative platforms to provide a unified and comprehensive communication experience.

3. Increased Accessibility

VoIP enables making calls from any part of the world with an internet connection. With the help of this feature, people are encouraged to work remotely and can perform their tasks outside of the company's premises. It is suitable for business candidates and those who travel frequently.

4. Higher Scalability

VoIP systems adapt easily to the changing needs of a business, allowing for quick adjustments in user numbers and features without infrastructure modifications. Service providers can scale services up or down based on client requirements, making VoIP a flexible option for growing companies.

5. Advanced Features

VoIP technology offers advanced features such as call routing, voicemail-to-email, hold music, and SMS/call filtering. These functionalities enhance the overall efficiency and professionalism of business communications.

6. Flexibility

VoIP supports almost every device, including traditional phones, smartphones, laptops, and PCs. All it needs is a good internet connection. With this feature, businesses maintain effective communication channels across different hardware, accommodating various user preferences and operational demands.

Benefits of Cloud PBX

Cloud PBX is a robust private branch exchange system designed to offer flexibility and scalability across businesses of all sizes. Its comprehensive security features stand out, utilizing multiple physical and digital protection layers alongside advanced encryption protocols to safeguard communications.

1. Centralized Communication Management

Cloud PBX simplifies business communications management through a centralized system. It ensures efficient handling of voicemails and significantly reduces the risk of missed or overlooked messages, streamlining communication workflows.

2. Customizable Setup

With Cloud PBX, companies can tailor their communication systems to meet specific operational needs. It supports various customizable features, such as call routing, voicemail greetings, and auto-attendants, enhancing customer service and internal communication efficiency.

3. Seamless Integration With Existing System

Cloud PBX integrates with existing business applications, creating an uninterrupted communication environment. It facilitates a unified user experience for managing calls, texts, and other forms of communication, which can significantly enhance operational efficiency and privacy controls.

4. Enhanced Mobility

Cloud PBX enables employees to connect from anywhere, using any internet-enabled device like smartphones, tablets, or laptops. It is particularly beneficial for remote workers or teams that need to stay connected while travelling or working from different locations.

Which One Should Your Business Choose?

When choosing between cloud PBX and VoIP for your business, it is essential to understand their differences. Even though both systems use the internet to operate, cloud PBX and VoIP offer different services and advantages.


Before choosing a business communication system, you must evaluate certain factors, such as business size, budget, and features. Both of the systems are feasible for all business sizes. However, VoIP systems are comparatively more cost-effective than Cloud PBX systems.


Cloud PBX and VoIP are powerful communication tools that work under an internet connection but serve different services. Understanding each system's differences and benefits lets you choose the best system for your business. Choosing a VoIP system is best if your business focuses on basic voice service and a cost-effective approach.


Consider using Calilio for your business communication. Calilio provides advanced features like call routing, voicemail-to-email, and AI-enhanced call summaries at competitive prices. With Calilio, enjoy clear, uninterrupted calls and a seamless communication experience.

Frequently Asked Questions

What is the difference between cloud PBX and traditional PBX?

Cloud PBX and traditional PBX systems handle business phone calls but operate differently. A traditional PBX or a landline is a physical system that needs infrastructural changes for setup, maintenance, or upgrading.


On the other hand, Cloud PBX doesn't require infrastructural changes because it is entirely online-based and managed by a service provider. Cloud PBX enables several advanced features, making it a more flexible and user-friendly business solution.

What is the difference between Cloud PBX and VoIP?

Cloud PBX and VoIP are different in their functionality and scope. Cloud PBX is a comprehensive, cloud-based phone system that offers advanced features like call routing, voicemail management, and integration with business applications managed by the provider.


On the other hand, VoIP is a technology that allows conversation over the internet. It provides phone services with potential additional features depending upon the service providers.

Which is better, PBX or VoIP?

VoIP is considerably better than PBX because VoIP is an advanced technology that works through the internet. It is a cost-effective system that enables uninterrupted calls with clear audio quality. Also, the advanced features provided by voip, like call routing, voice mail to email, and unified callbox, make VoIP way better than PBX. On the other hand, PBX is a traditional landline phone system that relies on copper wiring and operates without internet access.

Is cloud telephony a VoIP?

Cloud telephony is a service that uses VoIP technology to make a call through the cloud.

What is the difference between VoIP gateway and PBX?

VoIP gateway sorts a conversation into IP packets before transmitting it over the network. In contrast, in IP PBX, conversations are bundled into voice packets at the source and sent as a native IP packet to the receiving end, where these packets are reassembled.

Can Cloud PBX function without VoIP technology?

No, Cloud PBX cannot function without VoIP technology since it is a virtual telephone system hosted in the cloud and relies on VoIP to convert voice signals into digital packets for transmission over the Internet.

How does the cost of Cloud PBX compare to VoIP?

A comparison of the cost of a cloud PBX with a VoIP system is undertaken by considering additional services, infrastructure hardware costs, and maintenance requirements.

Latest Posts

From the blog

The latest news, technologies, and resources from our team.

Gain Insights, Lead the Change

Delve into our blog for tips and strategies to maximize efficiency. Start reading, and stay ahead.

International Number

Get International Numbers

Copyright © 2024 Calilio