Centrex is a PBX-like service providing switching at the central office instead of at the customer’s premises. Typically, the telephone company owns and manages all the communications equipment and software necessary to implement the Centrex service and then sells various services to the customer.
No switching equipment resides on the customer premise as the service is supplied and managed directly from the phone company’s exchange site, with lines being delivered to the premises either as individual lines over traditional copper pairs or by multiplexing a number of lines over a single fiber optic or copper link. In effect, Centrex provides an emulation of a hardware PBX, by using special software programming at the central office, which can be customized to meet a particular customer’s needs. As with a PBX, stations inside the group can call each other with 3, 4 or 5 digits, depending on how large the group, instead of an entire telephone number.
Centrex obviates separate exchange lines delivered to a site for use with a 1A2 Key System or similar, or PBX. Instead, telephone extensions, called Centrex lines, are delivered directly from the local exchange to the user. Some customers, however, still like to use a key telephone system for a small office within the large corporate Centrex, in an arrangement called “key behind Centrex”[1]. Unlike with a conventional PBX, it is a simple matter to have extensions at different locations while allowing them to function as if they were within the same building. Newer IP PBX systems also allow phones at any location with a WAN or Internet connection to act as a local extension. Facilities such as Direct Inward Dialing (DID), where individual extensions are offered a direct and unique telephone number for incoming calls, are standard features in a Centrex environment. Stations may also be part of a hunt group, allowing for automatic distribution of incoming calls to two or more extensions.
With the high price of Long Distance service, many large companies had their own network of private lines crossing the country or to distant countries. Managing these networks of ‘Tie Lines’ and connecting users to them was also an important part of Centrex.


  • Small business start-ups (growth and costs)
  • Banks and financial institutions (branch offices/multi-departmental branches)
  • Professional offices (reliability, connectivity and customer service)
  • Local government (reliability, cost, multi-location)
  • Hotels and guest houses (customer service)
  • Colleges and Universities (reliability, cost, multi-location, growth)
  • Temporary locations where permanent PBX services are impractical, such as a campaign office.