The IP500 V2 supports a firewalled 2 port Layer 3 Ethernet Switch.

When computers on the LAN communicate they do not care where the destination is, they just send messages with the address of the destination. These messages are likely to be received at all other computers on the same network but only one - the target destination - will act on the message. Where the destination is on another network, the router is needed to be the "gateway" to the rest of the world and find the optimum route to send the message on to the destination. The router alleviates the need to establish and hold a call for the duration of a communication session (when messages or IP packets are being sent between source and destination) by automatically establishing a connection only when data is to be passed. Routers may be connected together using WAN (Wide Area Network) links that could be point-to-point leased lines, managed IP networks, Frame Relay networks or exchange lines (Central Office). The IP Office system supports all of these types of network connections.

IP Office has an integral router with support for bandwidth on demand that allows the negotiation of extra bandwidth dynamically over time. Where connection is over ISDN, IP Office initiates extra data connections between sites only when there is data to be sent or sufficient data to warrant additional channels. It then drops the extra channels when they are no longer needed. The calls are made automatically, without the users being aware of when calls begin or end. The rules for making calls, how long to keep calls up etc, are configurable within IP Office.

It is possible to have several different routing destinations or paths active at any time linking the office to other offices and the Internet simultaneously.