Compared to traditional telephone communication systems, a Voice-Over-Internet-Protocol system is a much more cost-effective method of communication. Companies employ a Private Branch Exchange or PBX to connect internal phones to external lines for communication. VoIP business phone systems offer free calling with excellent long distance rates, as well as full service feature lists including call auto attendant, advanced call-routing, location calling and customer management software built-in. Features like these are free from VoIP business phone providers but are pricey add-ons with traditional communications providers. Flexibility is also a major advantage of a VoIP business phone system because upgrading the system is simple and customizations can be done easily from an online user interface provided by the service provider. Voice quality for your calls is reliant on your Internet connections bandwidth but with today’s high-speed offerings call quality is no longer an issue with VoIP communications.
Once your business has made the decision to move on from traditional telephone communication networks and is ready to make the switch to a VoIP system there is one question that remains;
Do I choose a hosted VoIP service or an On Premise VoIP system?
Switching to a VoIP business phone system is advantageous no matter which system is chosen in the end. However, there are differences between the two that are best to know beforehand. Both methods have unique advantages and disadvantages but one type is not necessarily better than the other. It is more about which suits your business better. Small business will most likely enjoy the low cost and easy scalability of a hosted system, while a larger business may choose the added level of control and customization that a premise-based system can offer.
The biggest difference between the two systems is whether it is installed onto your businesses LAN or whether it is a hosted service, accessed over the Internet. An on-premise VoIP system is installed onto your businesses infrastructure and connects to the PSTN (Public Switched Telephone Network). This means your IT staff is responsible for installing the VoIP system and also upgrading existing routers to work with the new system. With hosted systems, all that is required is to sign-up with a provider and an to have a IP telephone to start making calls. If any upgrades or installations are required, a VoIP business phone system provider technician will take care of it. This saves the headache of figuring out which hardware is required and then setting it up correctly. An on-premise system also requires in-house management to maintain function and efficiency, where a hosted system does not. Maintaining a complex phones system can be a difficult task. An in-house system offers more immediate control, as you do not need to wait for your provider to take action but requires staff with a suitable level of expertise. Customization is also faster with an on-site system even thought the same is possible from a provider.
In terms or scalability, a hosted VoIP service has the edge because making an upgrade is as easy as making a phone call. Your provider will already have extensive network infrastructure ready to go whereas an in-house system will require new hardware with installation and setup.
Another consideration is cost and pricing of the proposed VoIP systems. A hosted system will most likely cost more in the long run, assuming that once installed the system operates smoothly. A hosted system is initially cheaper because it requires no capital expenditure on hardware or costly upgrades, and the provider handles service issues. However, the cost of hardware is incorporated into your monthly bill, which will therefore be slightly more expensive than the operating cost of an on premise system. This comparison usually ends in a toss-up because hardware issues or upgrades are difficult to account for with an on-premise system. The general rule is that a hosted system is usually beneficial for most businesses, with the exception being large businesses that already staff and an in depth IT department capable of handling all VoIP installations.
No matter which system your business chooses, you can rest assured that your company will enjoy the same benefits that make VoIP communications so advantageous for business. Your communication flexibility will improve drastically and your system will be future-proofed, enabling your business to use advanced communication technology as the need arises.