What Kind Of Phone System Should My Business Have? Hosted PBX vs On-Premise PBX

Posted by Sam Mountstephens on Aug 23, 2017 10:58:00 AM

Hosted PBX and on-premise PBX systems represent two excellent options for business phone systems. Using an IP-PBX phone system is a positive move regardless of which office solution is chosen, but there are key differences and being aware of these will allow you to select the best system for your company.

What is Hosted PBX?

Hosted PBX or hosted VoIP (Voice over Internet Protocol) is a cloud-based phone system that is managed by a provider who houses the IP-PBX in their data center. The provider is also responsible for providing the technology and services for the phone system.

The desk phones plug into a router and the calls, signaling and features are handled through an IP-PBX server at the provider’s location.

Users of the hosted PBX are charged a monthly fee determined by an established minutes package and the agreed features such as voicemail to email.

What is On-Premise PBX?

On-premise PBX or IP-PBX, as this system is also known, is similar to a traditional PBX system that would be stored in a phone closet or computer equipment room. However, on-premise PBX systems utilize new technology to manage the IP routing.

The signaling is done with an IP phone to the IP PBX server using a LAN. Calls can be handled through a traditional phone company using gateway cards, as well as VoIP using SIP trunking provided by an Internet service telephone provider.

Positives of Hosted PBX

  • Low upfront cost for equipment and set-uphosted pbx allows for remote workers and multiple branches to connect to the primary office system
  • No maintenance as the IP-PBX is managed by the service provider at their location
  • Installation and configuration is handled by the service provider meaning minimal hassle
  • Providers have more resources than users, so new feature sets are possible and simple to roll out.
  • Unlimited call paths for incoming and outgoing calls are available
  • Simple to connect multiple locations and remote employees on one hosted PBX system
  • Calls can be forward to cell phones when employees or small business owners are away from their desk
  • Low monthly service cost
  • Easy to add or remove lines to or from the system
  • Software updates happen automatically so the system is always kept up-to-date without any effort
  • Loss of Internet has no effect on operations as calls can be sent to voicemail or cell phone due to redundancy within an off-site facility

Positives of On-Premise PBX

  • Having on-premise PBX allows IT team to create, adjust and delete users as needed, without having to contact a provider
  • Open source features can be added without additional fees
  • Ability to control and manage own server and every detail of the solution
  • If SIP trunking, loss of Internet has reduced impact as calls can be redirected to a cellphone as off-site facility will have backup power sources

Negatives of Hosted PBX

  • Call and voice quality is dependent on Internet connection
  • Customization of features requires service provider cooperation
  • Flexibility of system may be limited as its hosted off-site
  • Training required for users – may or may not be offered by service provider

Negatives of On-Premise PBX

On-premise PBX requires a technician who can manage the system effectively
  • An on-premise PBX requires a technician who can manage it effectively
  • High setup costs
  • Unknown long-term maintenance and support costs
  • Every expansion increase the complexity that has to be managed in-house
  • Expansions and changes may result in complications depending on phone company
  • Loss of power or PBX failure will mean callers are unable to get through halting business operations unless working with a SIP provider
  • Training required for users – difficult for one technician to manage this process

By analyzing the positives and negatives of hosted PBX and on-premise PBX systems, companies will be able to determine which system best suits their organizational needs. Hosted PBX represents a simple solution for companies that do not have the in-house IT resources or desire to manage their own IP-PBX. On-premise PBX is suited to companies with available IT resources and have the need to control their phone system.

What’s Next?

At One Ring Networks, we’re able to provide flexible hosted PBX solutions that can be easily scaled to meet your objectives. We are experts in adaptability and customize our solutions to each company that we serve. If you’re ready to get started with a hosted PBX system, contact us today at 855-663-7464 or sales@oneringnetworks.com


Topics: phone, voice, hosted pbx