An in-depth guide to modern business phone systems in 2025

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Every decision, every deal, every customer relationship: they all start with a conversation. And in business, the most effective conversations still happen over the phone.

Modern teams need modern communications platforms, like business phone systems that are built to streamline voice communication, help you do more with fewer resources, and manage high inbound call volume with ease. These phone systems take pressure off your team with: 

• AI-powered features that help you coach agents and offer 24/7 phone coverage 

• Integrations that sync with your CRM, helpdesk and other essential software

• Analytics that pinpoint how you can improve your team’s performance

In this guide, we’ll explore what sets modern phone systems apart, break down the most valuable features, and show you how the right platform can power up your team and boost your bottom line.

Business phone systems explained

A business phone system solution is a network of telephony devices and technologies that enables teams to manage voice communication professionally, both internally and externally. Modern phone systems are cloud-based, built on VoIP technology, and packed with tools that help businesses operate smarter and faster.

So while traditional landline phone systems connected people, modern business phone plans connect both people and platforms; these systems integrate seamlessly with CRM, helpdesk, and other essential tools to help businesses provide the best possible customer service and support, and bring in more sales. 

Integrated customer communications and intelligence platforms like Aircall offer sales and support teams a robust but easy-to-use system that aids collaboration and simple connections for remote and dispersed teams. 

These cloud-based systems scale with you; they’re not physical systems and don’t require hardware infrastructure, so you can add seats as you grow your team. They also come with features like real-time insights and automation tools that save you time and help you improve agent performance. 

Additionally, modern business phone systems come with advanced AI capabilities, like an AI Voice Agent that handles inbound calls and answers common customer queries, and AI Assist features that automatically generate call summaries, key topics, and action items and score calls to enable better agent coaching.

Types of business phone technology and systems

Not all phone systems are created equal, and choosing the wrong one can leave your team limited by a lack of features, or stuck with tools that don’t scale. 

Before you commit to a provider, you should understand how the main types of business phone systems differ in terms of setup, cost, flexibility, and features. Let’s break them down.

PBX (on-premise)

An on-premise PBX (Private Branch Exchange) setup refers to a legacy, hardware-based phone system that’s hosted and managed physically on business premises. These systems require upfront hardware investment, in-house maintenance, and IT expertise to manage upgrades or scale.

On-premise PBX might work for a legal firm with a fixed office setup and a full-time IT manager to oversee updates and manage downtime. However, these systems come with limitations in terms of scaling, offering remote work, and integrating with your tech stack. 

Hosted PBX

With a hosted PBX setup, a phone service provider manages your system offsite. In other words, the hardware infrastructure that powers your phone system isn’t located in your office, but rather in the provider’s data center. These systems, which require an internet connection, offer the remote access flexibility that on-premise PBX systems don’t.

Think of a mid-sized accounting firm that doesn’t want to deal with servers but still needs reliable phone lines. Hosted PBX offers stability and flexibility, and team members can work across various locations, or from home. 

VoIP

VoIP (Voice over Internet Protocol) technology, which powers hosted PBX and cloud-based phone systems, came onto the scene in the mid-1990s to replace traditional phone lines with internet-based calling. All you need is a stable connection for agents to make and receive calls from anywhere. This technology allows for more budget-friendly and scalable phone solutions. 

Take a remote-first marketing agency with teams scattered across cities or even time zones. A VoIP phone system enables them to stay connected, keep call costs low, and plug into tools they already use.

Cloud-based

Cloud-based phone systems, which also leverage VoIP technology, live entirely online. All call management, from routing to reporting, happens in the cloud, which makes them perfect for hybrid and remote teams. These systems are often equipped with smart AI features, real-time analytics, automation tools, and other productivity-boosting functionalities.

Take a SaaS support team with agents around the globe. A cloud-based phone system helps them manage high call volumes across multiple time zones, access caller history mid-conversation, and lean on AI to flag priority issues or surface scripts. 

Must-have features of a modern business phone system

If you’re investing in the right business phone system to help you optimize communications, improve the customer experience, and power your growth, these are the features to look for: 

• Call routing directs calls to the right person or department through call distribution customization, which enables customers to get help faster and more efficiently.

• IVR classifies callers according to their needs to route them to the most appropriate agent, saving time and reducing customer frustration.

• CRM integrations keep all your conversations and customer data connected, and give your agents the context they need to offer more personalized service and reach a resolution or sale quicker.

• Automatic call recording lets you revisit conversations whenever you need, whether it’s for training, quality control, or to jog your memory.

• Call analytics tracks key metrics like average wait time and missed call rate to give you the insights you need to make smarter decisions and improve agent performance.

• Click-to-dial enables agents to dial customers with a single click from one centralized platform to save time, reduce errors, and make calling faster and more efficient for your team.

• AI coaching features analyze calls as they happen and give real-time recommendations to ensure your team is always on their A-game and can handle anything that comes their way.

• Automated voice agents handle inbound calls and common questions so you can offer 24/7 service and free up your team to focus on more meaningful conversations. 

• AI-generated call summaries enable you to dive into the details of a conversation and review calls twice as fast for better insights in less time. 

• Key topic recognition quickly identifies key discussion points and trends in customer calls for faster call monitoring and more efficient call coaching.

Cloud-based business phone systems: Why they’re dominating the market

If your business is still using an on-premise phone system, it’s time for an upgrade. Unlike traditional setups, cloud-based solutions offer the flexibility, scalability, and features modern businesses need to grow. Here are a few reasons why they’re the new standard in business and customer communications.

• Lower setup costs: Cloud phone systems eliminate the need for expensive hardware, which reduces upfront costs and provides a more budget-friendly solution for businesses.

• Fast deployment: With no on-site installation required, cloud systems can be deployed quickly, enabling you to get up and running without costly delays.

• Scalable with business growth: Cloud-based systems grow with your business. Whether you’re adding new users or expanding to new locations, scaling is instant and affordable.

• Ideal for remote or hybrid teams: Cloud systems help remote, dispersed, and hybrid teams stay connected, as employees can access the system from any compatible device, anywhere in the world.

• Seamless software updates: Cloud systems handle updates automatically so your team always has access to the latest features and security improvements.

• AI enhancements: Cloud-based solutions come with AI-powered features that help streamline operations, from voice agents that collect caller details for seamless follow-ups to conversation trends that help you enhance customer service.

Powerful integrations, advanced AI features, and unmatched reliability make Aircall the phone system modern businesses rely on. Discover the power of Aircall.

Cloud-based business phone system comparison 

The market for cloud-based phone systems is rapidly growing, and businesses have more choices than ever before. To help you navigate the landscape, we’ve compared some of the leading solutions and highlighted their key features, integrations, cost, and who they’re best fit for. 

Looking for a deeper comparison before making your choice? We’ve put together detailed breakdowns of how Aircall stacks up against other top VoIP providers. Explore our side-by-side comparisons:

• Aircall vs Cloudtalk

• Aircall vs Dialpad

• Aircall vs Justcall

• Aircall vs Nextiva

• Aircall vs RingCentral

• Aircall vs Talkdesk

The benefits of investing in a business phone system

The best business phone system for your company will cut time wasted on repetitive tasks, keep your communications connected, speed up the sales cycle, and boost customer satisfaction. Here’s a few ways this technology can benefit your business. 

Improved internal collaboration processes

Cloud-based phone systems foster collaboration for remote and dispersed businesses, and keep teams connected, no matter where they are. 

Warm transfer allows an account manager to pass calls onto billing in seconds, and provide all the necessary context for a smooth conversation. And shared contacts and shared call inbox features give different teams all the context they need to collaborate on follow-ups and ensure nothing slips through the cracks.

“The transfer function is slick and keeps things moving. We can have a caller that needs to be transferred to a different team or we might need to initiate a conference call while they’re on the line. All with one click. Having call notes built in as standard has been a game changer and provides a great customer and colleague experience.”

-Daniel Prescott, Head of Customer Operations at Superscript

A more consistent customer experience

When customers call, they want quick answers and smooth handovers. A modern phone system makes that possible, so callers don’t have to repeat themself and can reach a resolution quickly and seamlessly.

Let’s say a customer calls about a delayed order. They’ll first reach an IVR menu, which will help them speak to the right agent on the first try, who tags the call appropriately. The next day, the same customer calls back and reaches a different agent; thanks to call tagging, that agent can now pick up right where the last one left off, and resolve the customer’s issues quicker.

“Tagging calls helps optimize the organization of relevant information, making our jobs easier. Being able to understand why people are calling in, parse that data out, and use some of that for future expansion and more efficient operations is absolutely what it's built for.”

-Mimi Aboubaker, Founder of Perfect Strangers

Smoother sales operations

Conversations without context lead to wasted time, frustrated customers, and lost sales. Cloud business phone systems put the full picture in front of your reps before the customer says a word.

For example, let’s say your sales rep just got off a call with a hot lead. With an integrated phone system, that call is logged instantly in the CRM, along with notes, tags and follow-up reminders. When the lead calls back a few days later, a different rep picks up, but they have the context to continue the conversation smoothly and close the sale. 

“A feature I can’t live without is CRM integration. My sales agents need all the context they can get before they pick up the phone. When our phone system syncs with our CRM, agents instantly see who they’re talking to and what their interests are. This simple step made a huge difference: our sales calls became 30% more effective, simply because the agent has a clear picture right from the start.”

-Wes Wakefield, Founder of Pro Coffee Gear

Aircall: A leading phone system for scaling businesses

Your business needs a phone system that does more than just connect calls; it needs to help your team communicate effectively, stay productive, and drive results. That’s where Aircall comes in.

Having a cloud-based solution like Aircall ensures that your team has all the tools they need to provide a seamless customer experience, from AI Agent support to real-time analytics and reporting. 

Plus, the tool integrates seamlessly with your existing software, from CRM to helpdesk tools, meaning no more scrambling to keep up with customer requests or siloed business communications.

Growing businesses like Qred Bank see massive improvements in productivity and customer experience thanks to Aircall. For this bank, partnering with us resulted in: 

• The ability to easily expand to meet growing demand in multiple countries

• Streamlined workflows thanks to CRM and other software integrations

• Call volume management via IVR and Call Routing features

• Enhanced quality assurance with Call Coaching & Whispering

• Improved customer satisfaction and increased efficiency 

Aircall is much more than a business phone: it’s an integrated customer communications and intelligence platform that gives you a smarter way to manage communication, boost productivity, and create exceptional customer experiences.

See how Aircall can help you transform your sales and customer support processes. Try for free today.  

Frequently asked questions about business phone systems

What is the best phone system for a small business?

The best business phone service for a small business is easy to set up without technical expertise but still gives you access to powerful features and integrations. Cloud-based solutions like Aircall, for example, are ideal for small businesses looking to improve communication and productivity without hefty upfront costs and complex implementation.

What is the best phone service for a small business?

The best phone service for a small business will streamline communication, enhance team productivity, and keep costs manageable. 

Aircall, for example, offers a comprehensive solution that integrates with over 100 business tools, offers time-saving AI-powered features, and ensures seamless communication for your team at an affordable price.

How do I set up a small business phone system?

To set up a small business phone system, you need to find a solution that’s easy to implement and manage. After choosing your provider and porting or creating your phone numbers, follow these steps to set your system up: 

1. Assign users

2. Define call flows

3. Record greetings

4. Set up extensions

5. Configure integrations

6. Test your system before launching

How much does a small business phone system cost?

The cost of a small business phone system will vary depending on the provider, features, and number of users. For a flexible, cloud-based option like Aircall, pricing starts at $30/month/user (annual billing). 

Aircall doesn’t require any hardware or installation fees, making it a cost-effective solution for SMBs looking to improve their communications without breaking the bank.

Published on May 31, 2025.