VoIP Features

Terms to Know When Setting Up Your Business Phone System

Written by Emily Boucher
June 7, 2023
6 Mins Read

Business phone systems have developed significantly over the last thirty years. When setting up your own, there are many options available to consider. The choices you make will depend on the specific needs of your customers, the capacity of your employees, and the way your business is structured. The following is a set of definitions that may make it easier to sort through what features are available for a business phone system. We can sort these terms into three categories: communication features, call management, and telephone and network systems.

VoIP Communication Features

Call routing 

Call routing, often referred to as automatic call distribution (ACD) systems, is a business management system where incoming calls are placed in a queue, and automatically distributed based on predetermined internal criteria. These criteria sort calls to the appropriate recipients within the organization.

Depending on the skill and capacity of the team, an organization can choose specific types of call routing systems that best suit both their and their customers’ specific needs. These systems include: 

  • Fixed order: the call is assigned to the first agent available.
  • Skills-based: the call is assigned to agents tagged with a specific category of skillset
  • Rotary: the call is assigned so that each agent must take a call in turn before moving to the next 
  • Talk time: the call is assigned to agents with the lowest record time talking to customers
  • TIme-based: assign calls based on working hours or specific time windows
  • Round robin: distribute calls equally among agents

Call forwarding

Call forwarding is when a business management system automatically forwards incoming calls to different phone numbers, automatically routing the call to a different, predetermined endpoint based on whether the line is available. 

For instance, call forwarding is appropriate to put into place when: 

  • a hybrid work situation where an employee’s office extension can be forwarded to their home office phone number;
  • An employee goes on vacation, and their calls need to be taken by another member of the team. 


SMS (Short Message Service) and MMS (Multimedia Messaging Service) are two different types of text messaging technologies, typically sent over a cellular network. They are also the basis for many text messaging applications, including iMessage, WhatsApp, and WeChat.

SMS was invented in the 1980s, and is the oldest and most widely used text messaging technology. A standard SMS message is limited to 160 characters, broken up into chained segments (arranged and sent in order) should the message exceed this length.

 MMS allows users to attach multimedia content to their messaged, such as images, audio, phone contacts, and video. There is no hard limit to the size of an MMS message, but most carriers will cap the file size at 300KB.


Voice-to-text, otherwise known as speech-to-text, is speech recognition software that listens to audio and delivers an editable transcript to a device. 

The software does this by recording speech and converting it into a digital audio file. The converter measures the sound waves in high, filtered detail to pull out the relevant sounds, then pulled apart and matched to phonemes (units of sound in any given language - English has 40 of these). The phonemes are run through linguistic algorithms - often natural language processing (NLP) machine learning models, fed into AI, comparing them to known sentences, words and phrases. 

The final text sent to the device is the final product of a calculation of the most likely match that the algorithm was able to come up with.


Voicemail-to-text is a voice-to-text technology that takes a voicemail recording and converts it into readable SMS texts, or emails. This is an increasingly popular option for businesses to triage incoming messages when otherwise engaged on calls, if WiFi is unavailable, or are trying to streamline their processes.

Team messaging

Team messaging allows for targeting and group messaging functionality, in order for all teams to communicate over projects using group chat. Slack and Discord are some of the better-known applications to use team messaging, but it has also been integrated into most productivity and project management platforms, including Asana, ClickUp, and Basecamp.

Auto attendant

An auto attendant is another type of ACD (automatic call distribution system). Auto attendants answer calls automatically, and route calls according to a simple menu, to an extension line, an outside line, or a recording. 

An example of a common usage for an auto attendant would be the customer service lines for banks, telecom services, or other high-volume services. An example of a simple menu would be “Press 1 to set up a new account, press two to manage billing, and press 3 to speak with a technical support representative.”

Different Types of Phone Numbers

Local Number

A local number is a telephone number assigned to a specific geographic area or locality, such as a city or town. It allows individuals and businesses within that area to make calls to each other without incurring long-distance charges.


The North American Numbering Plan (NANP) is a system of telephone numbering used for landline and mobile phones in North America, including the United States, Canada, and twenty-five regions in twenty countries including Caribbean, Puerto Rico, Bahamas, and U.S. Virgin Islands etc. It assigns unique three-digit area codes to different regions and follows a consistent numbering format to facilitate communication and dialing between these areas.


Toll-free numbers are phone numbers with a distinct three-digit code that is dialable from landlines at no charge to the caller in order to make accessing the company free and convenient for the customer. They are typical for customer service business phone numbers. Toll-free codes include 800, 888, 877, 866, 855, 844, and 833

Vanity numbers

A vanity number uses touchtone lettering to create a recognizable pattern relevant to your business’ brand (for instance, 1-800-FLOWERS). This allows users to remember your business phone easily and keep it top of mind, and more likely to recognize and choose your business when selecting a service. 

Telephone And Network Systems

VoIP Gateway

A voiceover internet protocol (VoIP) gateway is a device that converts analog phone signals to digital data packets. The gateway encrypts the packets for transmission and routes the call to the correct recipient. 

This kind of technology is enabled for switched and network interfacing, such as SIP trunking.

PBX Systems

A PBX (Private Branch eXchange) system is a type of internal telephone network where a central service provides voice, data and other communications services at a single location. This allows for shared lines among multiple users. For instance, a business phone system with extensions for each employee within the building uses PBX.

PBX is typically associated with analog telecom services, although SIP trunking allows digital services to be integrated into the system.

IP Phone

An IP phone (VoIP phone) is a phone that connects directly to the internet, using either an ethernet cable or a WiFi connection. Devices capable of this include desk phones, cordless phones and conference phones. These devices are designed to resemble the traditional office phone setup, but use a VoIP gateway to enable calls.

When a business phone system is enabled using an IP phone system, this is referred to as an a IP PBX, of a VoIP private branch exchange that can be connected together through a service provider using a local area network (LAN).

USB Phone

A USB phone is a peripheral device that looks like a PSTN phone and connects to a computer via the USB port for the use of supplementing VoIP applications. The USB phone does not have VoIP technology itself; rather it acts as an audio interface in the same way a headset would. 

The advantage of this is to get a clearer call with reduced audio ‘leaking from your own speakers (‘echo’ from your own voice). It also isolates the audio from your call into the USB phone rather than playing through your PC, which gives greater privacy.

PSTN phone

A PSTN phone is a telephone that is plugged into a specialized wall socket called a phone jack, which is wired into the public switched telephone network. A simple corded PSTN phone has the advantage of working during power outages. Until the development of mobile phones and VoIP technology, these and physical phone lines were the primary vehicles for telecom services.

Cloud-Based Phone System

 A cloud-based phone system, or cloud phone, allows users to make telephone calls over the internet rather than over analog physical phone lines. A cloud phone is hosted on one or more off-site secure data centers, in contrast to on-site PBX software servers.

Cloud phone systems are accessed via a variety of devices, including but not limited to VoIP-enabled phones, smartphone apps, and computer software. 

Corporate Network

A corporate network refers to a group of computers, routers, and various other IT infrastructures that function as an internal intranet network (as opposed to an externalized internet), which can only be accessed by a specific group of people. 

Corporate networks exist to provide security and reliability to the flow and processing of data within the enterprise. The network may use a variety of local area networks (LAN), wide area networks (WAN), virtual private networks (VPNs), and other protocols in order to provide this functionality.

physical phone lines (PSTN)

PSTN (public switched telephone network), more commonly referred to as a landline or a physical phone line, is a networked group of interconnected public telephone systems used for government and business phone systems. At present, PTSN networks are almost entirely digital save for last-mile telephone office connections to users.

Interactive Voice Response (IVR)

The technology of Interactive Voice Response (IVR) provides an automated phone system that permits incoming callers to retrieve information through a voice response system that utilizes pre-recorded messages. This system eliminates the need for speaking to an agent and allows users to navigate menu options using either touch-tone keypad selection or speech recognition. Additionally, this technology can direct calls to particular departments or specialists. A valuable tool for small business owners for providing an efficient and cost-effective means of managing incoming calls, enhancing the customer experience by providing 24/7 access to information and services, streamlining operations by routing calls, and offering valuable insights into customer behavior and preferences through call analytics.

Enable Landline

Landline calling in VoIP refers to the ability to use a traditional landline phone to make and receive calls over a VoIP (Voice over Internet Protocol) network. This is possible through the use of an Analog Telephone Adapter (ATA), which allows the landline phone to connect to the VoIP network. Once set up, the landline phone can be used to make and receive calls over the VoIP network, allowing for cost savings and additional features such as call forwarding, voicemail, and more.

Enabling landline calling in VoIP can be particularly useful for businesses or individuals who want to keep using their existing landline phones and phone numbers, but also want to take advantage of the benefits of VoIP, such as lower costs and more advanced features.

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About the Writer

Written by Emily Boucher

Copywriter who codes. Why? Because these languages are writing, I write for all audience and computers.