Smaller businesses only needing to support 30 to 40 phones might not be able to justify the purchase of a PBX system and instead might rely on another option called a key system. Like a PBX, a key system can act as a phone switch for phones within the organization and provide trunk lines back to the local CO for call destinations outside of the business.
The distinction between a classic key system and a PBX is more than simply the number of supported phones. In a PBX environment, callers typically dial a 9 on the telephone keypad to access an outside line. In other words, after they dial a 9, they get a second dial tone. This second dial tone comes from the local CO.
In a key system environment, because the number of lines (that is, trunk connections) going back to the local CO is relatively small, these lines are directly accessible from the key system's key phones. For example, you might be using a key phone with five line buttons. If you want to call outside of the local business, instead of dialing a 9 to access an outside line, you can press an available line button right on the key phone.
You might have been visiting a car lot, as an example, and heard over the booming intercom, "Kevin, you have a call on line three. Kevin, please pick up line three." In that instance, Kevin could go to one of the key system's key phones, and press the line three button to access the call.
However, if you have been in the market for PBXs or key systems lately, you have probably realized that the line between the two is starting to blur. More and more key systems are starting to feel very PBX-like. For example, these days, you might need to dial a 9 to access an outside line on your key system. These phone switches that have characteristics of both PBXs and key systems are sometimes called hybrid phone switches.