Cloud-Based or On-Premise: Which VoIP Phone System is Right for Your Business?

When considering a VoIP phone system, it is important to determine which type of VoIP system is right for you: on-premise or cloud-based? Both types of systems have pros and cons, depending on what you need for your business.

1. Hardware: One major difference between the two systems is hardware requirement. As the name implies, on-premise phone systems require physical hardware in addition to the phone to be on-site. In comparison, a cloud-based system requires no physical hardware besides the phones themselves.
2. Updates and upkeep: Since on-premise systems are physically on site, they often require more maintenance, whereas cloud-based systems are automatically updated.
3. Reliability and connectivity: On-premise systems are more vulnerable to natural disasters, power outages and hardware failures. Since cloud-based systems use an internet connection to make calls, your phones are as reliable as your internet connection. This also allows cloud-based systems to be accessed and used from anywhere there’s internet available (like a home office).
4. Cost: Cloud-based systems have lower upfront costs than on-premise systems, as well as predictable monthly fees. With an on-premise system, the starting cost is higher, and your monthly cost is determined by your local chosen phone service provider.
5. Scalability: Cloud-based systems are easily added to, and the same system can be used over multiple locations. On-premise systems only work at one location, so another would need to be purchased for additional buildings.

So, what type of system is for your business? Cloud-based systems have lower upfront costs, as well as more reliability and flexibility. They are great for small, midsized, and growing businesses. On-premise systems cost more upfront and can be more difficult to expand and manage. Multiple locations require multiple systems. They are best if you are a very large business where the upfront costs combined with SIP trunks may be more cost effective than a cloud-based system. Get in touch with our team to learn more and decide which system will benefit your business the most.