Comparing Cloud VoIP system and On-Site VoIP System

Once you make your decision on replacing your legacy phone system with a VoIP phone system, the next step is to decide whether to choose a hosted PBX service or an on-site VoIP system. Both systems have their pros and cons, so it is hard to say which technology is inherently better than the other. Your business needs, growth plans and of course in-house expertise can influence your decision on which type of system to opt for.

To help you with your decision here is a comparison of these two types of VoIP phone systems:

1.     Installation

The first major difference between the two is that the cloud VoIP system also known as hosted PBX does not require any physical/hardware set-up. It is hosted over the internet through cloud based technology. Whereas an installed VoIP or on-site VoIP system runs on your infrastructure and connects to the public switched telephone network (PSTN). This means you and your IT staff are responsible for installing the VoIP solution and also upgrading any routers that you might have to use as a voice gateway to support the phone system.

2.     Upfront Cost

Cost is an important factor when it comes to comparing the two. Cloud VoIP systems have low upfront cost and are typically charged as a monthly fee per user. However, using VoIP as an on-site server has a higher cost upfront but then no recurring monthly fee. Hosted VoIP tends to be an attractive option for small businesses and start-ups with 5 to 15 employees because of the low upfront cost.Total Cost of Ownership (TCO)

Cloud VoIP phone systems have a very low total cost of ownership due to the savings in IT personnel and because the hosted VoIP service provider takes care of both server configuration and maintenance. This can play an important role in system selection depending on your business size and budget needs.

3.     Avoid PBX Equipment Obsolescence

As compared to onsite VoIP systems, with hosted VoIP businesses don’t have to worry about PBX equipment obsolescence since no hardware equipment is needed in this system.

4.     Management

To manage and maintain the on-site VOIP phone system you require in-house resources and expertise. If you have an in-house technical expert team thn this might be a good choice because it which offers you granular control over the features you choose for a more customizable voice over internet protocol system.

However, if you have limited resources and want to avoid the management of a complex phone infrastructure, then hosted VoIP is your best bet. Hosted VoIP does not require any technical expertise and it also have a low maintenance cost as there is no hardware involved. Cloud phone systems truly eliminate the cost of system maintenance and management.

5.     Scalability

. With a cloud VoIP phone system you can add more phone lines as per your requirement without the need of any hardware equipment. And more importantly it takes a couple of clicks on your account page to add more virtual phone lines.

However, adding more phones to an on-site VoIP system is likely to involve network and phone equipment which can be both time consuming and costly.

6.     Contract and Long Term Commitment

With a cloud service you are not tied into a long term commitment to a specific communication approach and on-site equipment. You only have to pay for what you need today and expand on demand. You can adjust your communication solutions according to your business needs. With this flexibility, you can respond to rapidly new opportunities and stay abreast with the ever-changing market conditions.

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