Public Switched Telephone Network (PSTN) and VoIP Technology

Public Switched Telephone Network is the old telephone system. Though gradually being replaced by VoIP and other latest alternatives, PSTN is still used in many places.

  Public Switched Telephone Network

Public Switched Telephone Network or PSTN is the traditional form of telecommunication. This circuit-switched public telephone network allows calls from landline phones.

This public Switched Telephone Network is also referred to as the Plain Old Telephone System (POTS). This network carries voice calls for calls made from landlines or cell phones.

PSTN refers to the global network of voice carrying telephone infrastructure. However, this traditional form of telecommunication is very costly. And because of this form of telephony has faced a steady decline over the last decade.

Although PSTN phones are reliable and generally held as the standard form of communication, the availability of cheaper alternatives changed the scene. In fact, a report of Statista states that in 2017 there were only around 979 million fixed telephone line subscriptions worldwide.



1876 was the year when commercialization of telephones began. At that time, telephones were instruments that operated in pairs for private use between locations. Gradually the number of users increased which in turn led to the growth of Public Switched Telephone Network.

Soon deployment of tele-traffic engineering was necessary to check and maintain the Quality of Service (QoS) for the users. By the 1970s, the telecom industry started the implementation of packet-switched network data service.

And in today’s 21st century, both analog and digital technologies are in use. But comparatively digital technologies such as DSL, ISDN, FTTx and cable modems are more popular.


Components of PSTN

The components that Public Switched Telephone Network include are telephone lines, fibre optic cables, switching centres, cellular networks, satellites and cable systems.

While on the front, one simply dials a number and on the other end, one receives the call, the backend process is much more complicated than this. There are numerous steps working behind the call, which makes it possible and eventually successful.


How the PSTN works

Firstly, the telephone set converts the sound waves into electrical signals. Thereafter, the transmission of these signals to a terminal takes place through a cable. The function of the terminal is to collect the electrical signals and transmit this to the central office (CO).

The central office routes the calls through fibre optic cable in the form of electrical signals. The fibre optic cable carries the signals in the form of light pulses to their final destination.

The purpose of tandem and central office is call routing. After reaching the right office, on the receiving end, the light pulses change back to electric signals.

Next, the electrical signals are routed to a terminal. Thereafter, the terminal routes the call to the appropriate telephone number.

Eventually, when it is for the user to receive the call, the telephone set converts the electrical signal back to sound waves which the receiver hears.


Private Branch Exchange

Both businesses and residential users use Public Switched Telephone Network. But even if the cost is manageable for the residential users, it is too high for businesses due to the number of calls they make. Hence, many large organisations prefer Private Branch Exchange or PBX.

The PBX acts as a local exchange for the organisation and connects all the phones in the organisation. Also, the range of services include call transfer, call conferencing, auto-attendant, and voice mail, call hold and many others. PBX is a combination of software and hardware and helpful in many aspects.

To know more about PBX check here: All You Need to Know about Private Branch Exchange, IP PBX & Hosted PBX


VoIP Technology

VoIP or Voice over Internet Protocol is one of the latest advancements in the field telecommunication. Also, it is the best alternative to PSTN. VoIP technology is famous for reducing the call cost.

In addition to this, the popularity of VoIP is also because of numerous user-friendly features. To know more about the reason behind the popularity of VoIP Calls check here:  6 Reasons Behind The Rising Popularity of VoIP Call

In VoIP technology, internet connection is necessary to make calls. VoIP, in other words, is the transmission of voice and other data over the internet.

In this technology, the conversion of the voice signal to digital packets take place and then travels over the internet to reach its destination.

The main difference between PSTN and VoIP technology is the mode of switching that each uses for call transmission. While PSTN uses circuit-based switching, VoIP technology, on the other hand, uses packet switching.


Which is better: PSTN or VoIP?

While the term “old is gold” is prevalent in many areas, for this sector VoIP is a clear winner. VoIP technology uses the internet connection to transmit data which is much faster than the PSTN. To know more how VoIP helps in small businesses check here: Usefulness of VoIP Technology in Small Businesses

Here are some aspects where VoIP surpasses the Public Switched Telephone Network and makes itself favourable.



Undoubtedly, the cost is one of the major factors that affect a product or a service. The cost of PSTN is much higher than that of VoIP. For PSTN, one requires dedicated lines and hardware.

Cost for PSTN varies on additional features. Also, the call cost in PSTN service depends on the distance where the local calls are cheaper and the mobile or international calls are costly.

On the other hand, for VoIP, the cost is low due to the minimum requirement of hardware. The only necessary item on the user’s part is internet-enabled telephone set or a mobile phone with internet access.

The cost for setup and installation of VoIP Phone System is also less than PSTN charges. Although here too, the addition of extra features may change the price.

And lastly the call cost. VoIP Calls do not charge on the basis of distance. VoIP Calls are even available free of cost. Though certain features like calling a non-VoIP number through certain features like calling a non-VoIP number through VoIP may require credit.



Using VoIP Technology results in an increase in productivity. VoIP Phone system helps the employees to communicate with one another in a more effective way. It helps to connect them faster.

This technology is also efficient in terms of data transmission. Furthermore, VoIP Technology provides the opportunity to work from home or on-the-go. This especially helps to connect remote employees and lets them work according to their convenience.

Also, in addition to this, VoIP offers the feature of audio, video conferencing. This feature of conferencing helps to connect employees from different locations in real-time and hence saves both time and money necessary for travelling.



In this aspect, one can say that PSTN is more secure because of the dedicated phone lines. Though it is partially true, on the other hand, there also have been cases of eavesdropping or tapp9ing of phone lines.

The security for VoIP Calls mostly depend on the internet connection and the VoIP Service Provider. Many VoIP Services offer encryption and 2-step authentication and many other security protocols to protect the privacy of the user or the organisation.

To know more about VoIP Security check here: Security Measures For VoIP Business Components



With numerous hardware, telephone lines and all other accessories, the maintenance of Public Switched Telephone Network is a costly affair. Cost also increases with the addition of phone lines.

On the contrary, VoIP Technology is based on software and requires minimum maintenance. Regular updates of software not only removes any glitches but also at times adds new features.



Businesses and organisations grow with time and thus their requirements change alongside. The option of scalability is a big plus point for VoIP.

Accommodating according to the business size and requirement is easy in VoIP Systems. Scalability is however difficult for PSTN systems. Additional cost and hardware are required for any necessary changes.


You may also read