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Types of Phone Systems

By editorial staff, writer
Jun 18, 2014
Image Credit: chainarong06/ Shutterstock
> Technology

There are three basic types of business telephone systems: KSU, PBX, and VoIP. For each of these systems, there is a hosted (cloud) and a nonhosted version. Let's take a closer look at how they differ.

Key system units

The most basic phone system is the key business telephone system that uses the Key System Unit (known as the KSU). This type of system is only suitable for small businesses with no more than 40 employees working as phone operators, due to the limitations of the number of phone lines incorporated into it. It's an easy-to-use system, relatively comparable to a home telephone system. It has all the basic features a business will need; however, it lacks portability and flexibility. It uses a central switching device – the key system unit – to manually determine the phone-line selection.

The variation of this system is called KSU-Less, which has the same phone capabilities as the basic system; however, it is portable and flexible, as it does not use the central switching unit, and it's entirely wireless.

KSU-Less has some serious limitations, though, as it only allows for approximately 10 phone operators, and it's not sold commercially – it must be requested from a phone-system provider. The KSU-Less is an ideal system for a very small business that doesn't intend to expand its workforce. It's not that suitable for small businesses looking to grow.

Private branch exchange

Another type of system is the private branch exchange system (known as PBX). This is a more advanced system than the KSU and KSU-Less systems, and as such, it has more features. It uses programmable switching devices, allowing for the automatic routing of incoming calls. This type of business phone system is suitable for a company with 40-plus employees, as it's a much more automated system. Another major advantage of the PBX system is that it features an uninterruptible power supply (UPS), allowing a business to remain functional for some time, even without electricity.

Editor's Note: Looking for a phone system for your business? Fill out the below questionnaire to have our vendor partners contact you about your needs.


A modification of this system is the hosted PBX. The only difference with this system is that the programmable switching devices are no longer installed on premises – it's hosted by a telephone provider. The main advantage is the ability for a business to avoid some installation and maintenance costs involved with the standard PBX system without losing any of the advanced features it initially has to offer.

Voice over Internet Protocol

The latest telephone innovation offered for businesses is Voice over Internet Protocol (known as VoIP). This is the most advanced system by far, allowing a potential client and phone operator to communicate with each other even if the two are in completely different countries. It works with the use of both the internet and a computer. However, this also makes it the most costly system, with the cost determined by the number of employees needing to use the system. The main benefit of this system is that all functionalities can be accessed via a computer.

Similarly to the previous system, the VoIP system can also be hosted, offering the same advantages as the basic VoIP system, with less installation and maintenance involved for the business using it, as the service provider hosts the main telephone system.

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