The Evolution of Phone Systems: From Landlines to VoIP

The evolution of business phone systems is truly fascinating. From switchboard operators to internet-powered phone systems that help you connect beyond a simple phone call, here’s a brief history of the evolution of business phone systems (and how you can ensure your business is keeping up with the times).

Evolution Of Business Phone Systems Timeline

Phone systems have come a long way since they were first introduced commercially in 1877. Here’s a quick breakdown of their history and how they have evolved into the modern communication platforms we use today.

Late 1800s: Manual Switchboards

When telephones became commercially available in the late 1800s, switchboard operators were hired to manually answer phone calls and route them to the correct caller.

As you can imagine, businesses faced significant challenges under this system. One of the primary issues was the cost, as different departments of a company each required a separate line.

Fortunately, these challenges were at least partially resolved with the introduction of private branch exchange systems, which didn’t occur until the 1960s. Manual switchboards and switchboard operators were obsolete by the late 1970s.

1960s: Private Branch Exchange (PBX)

In the early 1960s, automated switches and private automatic branch exchanges (PABX) were introduced. PABX systems functioned as private telephone networks that allowed businesses to not only make and receive calls externally but to also call internal extensions.

A manual version known as a private manual branch exchange (PMBX) was also introduced. As the name suggests, calls would need to be routed manually by an operator. However, these systems quickly became obsolete as automated systems were the preferred choice of businesses.

Once manual systems were out of the picture, the name for these systems was shortened to private branch exchange (PBX).

PBX didn’t catch on initially, as the installation and maintenance costs of these systems were too steep for most businesses. However, as businesses grew (as did the use of the telephone), more people began to invest in PBX systems.

Through the years, PBX continued to grow and more features became available. Interactive voice response menus, three-way calling, call forwarding, call waiting, and caller ID are just a few of the tools added to improve communications via telephone.

Despite this growth, there were still challenges with PBX systems, including the need for on-site equipment and expenses for services like maintenance, repair, and installation of these landline-based systems.

2000s: The Introduction Of Voice Over Internet Protocol

In 1995, there was a major innovation in business phone systems with the introduction of the first commercial Voice over Internet Protocol (VoIP) system. Instead of the traditional copper wires and infrastructure required for landline systems, VoIP phone systems use the internet to connect callers.

Connectivity issues and poor call quality were common issues that plagued VoIP in its early stages. However, even from the beginning, the idea of being able to make and receive calls using a computer was something new and innovative.

It wasn’t until the early 2000s that VoIP really became a viable option for business phone systems. As broadband internet advanced, so did VoIP. Calls were clearer, service was more reliable, and calling features not found on legacy PBX systems emerged.

Today: VoIP Business Phone Systems

Today, many businesses use these revolutionary VoIP phone systems. The latest systems are secure, reliable, and provide exceptional call clarity, as long as you have a stable internet connection.

VoIP phone systems require minimal equipment. You don’t even need a desk phone (although you can use IP phones or analog phones with an adapter). You can make and receive calls and manage your system from a computer, tablet, or cell phone.

Modern VoIP system features are also more advanced, allowing you to use unified communications to connect with employees and customers. Basic calling features that were once paid add-ons usually come standard with most VoIP plans.

VoIP plans are also more affordable than phone systems of the past and are easy to upgrade without requiring an on-site technician.

2025: The Shut-Off Of PSTN

The future is VoIP, as evidenced by the shut-off of the Public Switched Telephone Network (PSTN), the network that landlines phones use. The Federal Communications Commission has already given phone carriers permission to abandon old infrastructure, which many have done in favor of VoIP.

The shut-off of PSTN is expected at the end of 2025, although this deadline could be extended. What does this shut-off mean for you? It means that the analog phone systems of the past will be replaced by digital systems (aka VoIP).

Why Your Business Should Upgrade To A Modern Phone System

For many businesses, it’s a smart move to switch to a modern business phone system. VoIP systems are affordable, easy to use, and provide plenty of features you won’t find with legacy systems. VoIP systems offer more mobility and are scalable to grow with your business. And if you’re still not convinced, the sunsetting of the PSTN will arrive before we know it.

Be prepared for these impending changes by researching your options now. Know what to look for in a provider and do your research on features, pricing, and equipment options. As you get closer to upgrading your system, test VoIP with a free trial of one (or more) of the best VoIP phone systems. Switching is fast and easy, and before you know it, you’ll be a part of the future of telephony.