On premises v.s Cloud Based Phone Systems | What is the difference?

The difference between cloud and on-premises 

A cloud-based telephone system is one whereby software and hardware are not located at the building of the customer. Instead, it is supplied by a service provider.

With an on-premises telephone system, the hardware and software will be located at the building of the customer (usually in your server closet). This includes the likes of central processing units, servers, phone system cabinets, and common equipment units.

There are a two main types of cloud phone systems, so let’s take a look…

What is PBX?

PBX stands for Private Branch Exchange. This means that there is a private telephone network utilised within an organisation or business and users can communicate with customers but also internally as well. Put simply, PBX is a business grade telephone system offering features such as business hour settings, call conferencing and on hold music. 

What is VoIP?

VoIP stands for Voice Over IP (also known as Voice Over Internet Protocol and IP Telephony). This relates to the communication channel that is used. Essentially, VoIP means that your telephone service is going to be delivered over the Internet and this allows for easy mobility, more functionality and easy installation and use. 

Choosing between On Premises & Cloud Based Phone Systems

Now that you have a better understanding of the different options that are available, you need to assess them so you can figure out what is going to be right for your business.

Cloud-based phone systems are often considered the most cost-efficient, especially for small companies. All you are going to need is an Internet connection, you do not need a telephone line or any of the hardware that was mentioned above. However, cloud-based systems do mean that any call transfers will happen many miles away and could lead to latency if you do not have a strong internet connection.

On Premises systems do mean that you have hardware located at your premises, though this may not convenient for some smaller businesses but will mean that you have much more control over your phone systems and the transfers are happening just a few feet from you.

Hopefully, you now have a better understanding when it comes to the differences between cloud and on-premises phone systems. There is no right or wrong answer when it comes to choosing the telephone system your business is going to use. However, there is also no denying that more and more companies are moving towards cloud-based systems today.

Berry Telecom provides phone systems and ongoing support to over 15,000 users within small to medium businesses across the UK. We have a UK based team that will design, deliver and support your leading-edge phone system – if you need any help with deciding the best system for your business, call us today!