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The difference between hosted and on-site phone systems

Pros and Cons

There are pros and cons of both hosted and on-site phone systems. It’s important to understand the differences to make the best decision for your business.

ConsiderationHostedOn-site
ExpenditureOpex expenditure (not upfront)Capex expenditure (upfront)
MaintenanceNo maintenance requiredOngoing maintenance
UpgradesIncludedNot included
TrainingNot providedProvided
ExpansionLow costHigher cost
Pros
  • Does not require a dedicated staff member on-site
  • Can still connect during power cuts
  • Provider handles installation and upgrades
  • Easy and fast enhanced features
  • Simple relocation process
  • User can stay with current carrier
  • Reduced costs over time as server is owned
  • 100% control to add, edit and delete users
  • Open source features without license fees
  • Choice of ISDN or SIP Trunks (lower cost than ISDN) to route traffic
Cons
  • Voice quality relies on Internet connection
  • Loss of Internet results in loss of phone service (can go to voicemail or routed to mobile)
  • Cancellation fees may occur
  • Requires a dedicated staff member on-site
  • Loss of functionality during power cuts
  • You’re responsible for installation and upgrades (technician may be required)

 

Hosted

Hosted systems based in the cloud have low start-ups costs, allow you to manage communications from anywhere and all IT responsibilities are with the provider, meaning you need no dedicated IT staff for this resource. A huge benefit is that allowing staff access to your phone system anywhere promotes efficiency and productivity.

On-site

Installing SIP Trunking and having hardware on your premises gives you a great deal of control and customisation of features as you use the software. Due to the level of knowledge needed, it is advised to have a dedicated IT staff member or members to manage this functionality.

This service provides low monthly rates and you can have metered payment plans or unlimited contracts.

Both hosted and on-site phone systems, where you are using a SIP connection, use your Internet connection.

Which is right for my business?

Hosted

Hosted is ideal for businesses that are just updating to VoIP systems and are new to the functions and processes. Hosted allows businesses to have the technology, performance and maintenance taken care of by the provider, meaning there is minimal work to take on when the system is adopted.

Hosted would be the best option if:

  • You do not want to incur high upfront costs
  • You do not have additional IT resource to manage the system
  • You want to experience the following benefits of hosted
  • You’re a small or medium sized business

On-site

An on-site phone system suits larger businesses that will need to add new users frequently and want to take on an advanced level of day to day customisation. It’s a long term investment that saves on costs overall as you own the hardware (servers and switches etc).

On-site is the best option if:

  • Your finance plan suits high upfront costs with low monthly rates
  • You have dedicated IT personnel to manage the system
  • You want a highly scalable and flexible system

You also need to take into consideration projected business growth, whether you operate across multiple sites and if you are planning on relocating in the near future. If any of these are the case, then hosted may be the best option.

Once you get in touch with Southern Communications, all requirements and business considerations can be discussed to create the best package for your needs.