The end is near for POTS (plain old telephone service), so you have an important choice: stay with an on-premise phone system or upgrade to a cloud-based phone. This likely isn’t the first time you have considered it and are looking for some more convincing. Well, look no further than this very article. According to G2, businesses using voice and video conferencing with unified communication (UC) save up to 30 percent on those tools.
What has been holding you back from saving money but increasing features?
Are Phones Systems Still Needed?
Absolutely. Countless studies and reports have surveyed many people, and overwhelmingly, talking on the phone is still the preferred method when dealing with a business. A report from PwC found that 82 percent of customers prefer a human touch. Other methods are making their way into the conversation, such as texting, email, and social media, but when issues or questions arise, picking up the phone and talking it through wins.
What are On-premise Phone Systems?
An on-premise phone system, or PBX (private branch exchange), is installed at the location of the business. Traditionally, various phones, faxes, and overhead paging equipment physically connect to the system in a data closet with wires running throughout the facility. There’s more management associated with an on-premise system as well. Typically, onsite IT personnel diagnose any issues and ensure the rest of the network is running at peak performance.
What are Cloud-based Phone Systems?
A cloud-based phone system relies on your internet connection to sign into a phone system portal to make and receive calls. There are options for connecting with physical phones, computer softphones, or cell phone apps. You aren’t tethered to any specific location and can connect wherever you can access a stable internet connection. According to the FCC, a cloud-based call’s minimum internet download speed is less than 0.5 Mbps. A bonus is that since you’re working with a managed service provider (MSP), the system’s software is always up-to-date and geo-redundant for optimal uptime, and your investment is future-proofed for any new features.
Since cloud-based phones can go by several different names, here is an assortment to clear up any confusion:
| Hosted VoIP | Hosted PBX |
| Virtual VoIP | Cloud-based phone system |
| Cloud PBX | Unified communications as a service (UCaaS) |
Comparing Cloud-based and On-premise Phone Systems
There are many use cases, but both options can be boiled down to answer one question: What level of responsibility do you want in your phone system? Do you need a plug-and-play solution, or does your business have the resources and need an on-premise setup?
- For cloud-based phones, you have limited upfront investment — up to 90 percent less than an on-premise system. But you will have a monthly bill since you don’t own the system, just the access, so these ongoing costs may be a deterrent.
- The upfront costs can be substantial for on-premise phone systems, and in-house or contracted maintenance is another ongoing expense. Your business use case will help you decide, but the need for an on-premise system is a small percentage of today’s installations.
Other factors must be considered, but starting with the business need will drive the solution. You should work with a provider like decibel, who can help guide you through what’s possible for your business phone system.
Verdict: Cloud-based or On-premise Phones
Most businesses should embrace the technological advancements made with business communication and invest in cloud-based phones. You get simple interfaces, an enormous set of features, remote or hybrid on day one of installation, customer sentiment analysis, and more. On-premise systems have had their time and, with POTS, are on their last legs.
For over 30 years, decibel has been a leading business communications industry leader. We believe the simplified world of cloud-based phones will empower your business with features and customer improvements you didn’t know were available. Contact us today to begin the evolution of your communication.