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IP PBXs are usually NT servers with telephony software and voice cards. Some disadvantages are the ability to scale the system and a dial tone that's dependent on NT, which doesn't offer the same uptime as a switched phone network.
Until recently IP PBXs have been targeted at offices with 100 users or less, but Alcatel recently announced a system that incorporates gateway and call processing in a single device and can accommodate up to 50,000 users. 3Com, Lucent and Cisco have all announced plans to provide the same type of product.
The beauty of an IP PBX is being able to create a distributed system. For example, allowing you to distribute your phone system throughout an IP network, so geographically separated phones with features such as direct dial, call forwarding, conferencing and voice mail provide the appearance of being connected directly to the local PBX.