On-Premise vs. Hosted IP PABX Phone Systems

Business owners are initially attracted to VOIP by the low call costs, but once they understand what an IP Phone System truly offers their business they start to get really excited.

Chances are, if you are reading this article you have been doing your research and want a better understanding of the differences and benefits of Hosted IP PABX Phone System vs. On-Premise IP PABX Phone System.

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IP and PABX terms explained…

On-Premise vs. Hosted PABX IP Phone System Comparison

on-premise pabx ip phone ssystem

On-Premise IP Phone System
hosted pabx ip phone system

Hosted IP Phone System
What’s the difference?
On-premise IP Phone Systems are operated and maintained by your company (usually supported by your equipment providerHosted IP Phone Systems are operated and maintained by your company’s VoIP service provider
ip system neutral
Phone system hardware
Handsets (Phones)
And your choice of carrier
ip system neutral
Selected carrier
Carriers software
Carriers range of supported handsets (phones)
Hardware Requirements
ip system neutral
PABX and supporting trunk cards
Supporting extension cards
I.P. Handsets
Note: Can integrate with majority of existing handsets
ip system neutral
IP Handsets – Limited to your selected carriers supported handset range
Your business may also require a router
Upfront Costs
ip system con
Higher initial equipment costs,
Higher setup costs
ip system pro
Lower initial setup costs,
Lower setup costs
Ongoing Costs
ip system con
Higher long term maintenance costs
ip system pro
Lower on-going monthly cost after system is paid for
Ability to SIP trunk with VoIP provider to get low cost calls
ip system pro
Lower to no maintenance costs
ip system con
Ongoing monthly service fees
Fee increases can be charged and/or cancellations fees
ip system pro
Complete access and control allowing you to adjust, create, delete users, extensions and turn on or off feature sets
Add / change users from unit
Additional features (open source) added without license fees
ip system con
Additional users managed by your carrier
Will incur both the cost of hardware (IP phone) and potentially additional service plan costs
Flexibility and Upgrades
ip system pro
On-premise systems offer unrestricted access to your systems interface for managing users, call settings, and features
Greater customisation options for integrating with business applications like Customer Relationship Management (CRM) and Contact Management software such as Salesforce.com, Microsoft Dynamics and Microsoft Outlook
You decide what handsets you want and you can add surveillance equipment as well
It’s all DIY. You’ll enjoy tight control over your system and know it inside and out. You’ll also dictate how quickly new features or upgrades are implemented
ip system con
System flexibility is limited – With a hosted system your provider will implements solutions across the board for all customers. This can be time consuming, and you’ll be left waiting to be serviced
Customization and new future feature additions can be slow or non-existent as providers unlikely to customize for a single business
ip system pro
You can incorporate traditional lines in case of data or power outages
On-premise systems are not carrier specific, so if your carrier goes out of business you are free to shop for an alternative provider
ip system con
Loss of Internet or power will result in loss of phone service
You are without a phone system if your provider goes under
Your phone solution isn’t custom built to suit the specific demands of your business
Quality of Service (QoS)
ip system pro
On-premise IP PABX solutions will prioritize your data traffic
ip system con
Connections (signaling) and voice quality are directly related to your Internet connection
ip system pro
No concern of anyone listening to your calls
ip system con
Be sure to check selected carriers privacy policy
It’s Your Choice
There are Pro’s and Con’s for both Hosted and On-Premise IP PABX Phone Systems, the benefits of an IP Phone System should not be ignored though. In our experience the choice for business owners generally comes down to available budget and the age of the business. If you need a hand to weigh up the best option for your business – we’re always available

VOIP Phone System Benefits

Benefits that are common to both hosted and on-premise IP PABX Phone Systems
  • Call cost savings
  • Abundant, interesting and useful features
  • Phone portability
  • Service mobility
  • Cheaper hardware
  • Flexible network layout
  • Integration and collaboration with other applications
  • Administrative interface for simple management and customisation
  • No geographical boundaries
  • Simple to conference
  • Fax over IP

Deciding on the right IP PABX Phone System option…

Although expanding and reconfiguring an on-premise IP PABX phone system will cost more than a hosted system, the clear advantage is the level of access, scalability and customization available to your business. You can also implement changes when it suits your business best. You enjoy ultimate flexibility.

Keep in mind that with an on-premise system, you bear all the risk and aggravation associated with expansion and growth, so good support should be considered. If you’re absolutely sure of your communication needs won’t be changing, then investing in equipment may make sense.

Due to low upfront costs and minimal management, most small businesses can benefit from a hosted IP PBX phone system. But every small business has its individual needs. If you’re a small business owner trying to decide between a hosted and an on premise IP PBX phone system solution contact the team at Key Technologies.

On-Premise IP PABX Phone System

More affordable than you think – plus we offer low cost maintenance.

Panasonic IP PABX Phone System
Installed, Inc. Trunk + Extension Cards, Conference + Voicemail Functionaility and 4 x Panasonic IP Handsets

To get pricing  – call Key Technologies on 1300 755 615


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