Private Branch eXchange
In principal this is
much the same as PSTN but for a private telephone network such as within a
company. Can be a simple hardware device.
The advantage to a company
running a PBX is that outside lines don't need to be run to each desk, you
are probably familiar with 'dial 9 for an outside line' this is the PBX at
work. With phones connected to the PBX internal calls (within the company
- therefore within the PBX) are free, only external calls are chargeable.