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June 23, 2022
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Enterprise Phone System: Cloud-based vs. On-Premises

Looking to Upgrade your Enterprise Phone System

Are you looking to upgrade your business's Enterprise phone systems but unsure whether to go with a cloud-based or on-premises solution? In this article, we'll compare the advantages and disadvantages of both options to help you make an informed decision.

Cloud-based Enterprise phone systems offer a range of benefits, including cost-effectiveness, scalability, flexibility, reliability, security, and disaster recovery. On the other hand, on-premises systems offer control over hardware and software and the ability to customize the system to meet the specific needs of the organization.

We'll look at the cost comparison of cloud-hosted vs on-premises phone systems, as well as the maintenance and support considerations for each option. We'll also discuss the potential for integration with other systems and provide case studies of companies that have successfully implemented cloud-based and on-premises enterprise phone systems.

By the end of this article, you'll have a better understanding of the pros and cons of on-premises phone systems vs cloud-hosted telephone systems and be able to make an informed decision about which option is right for your business.

Want to learn more about Enterprise Phone Systems? Don't miss our latest video!

Enterprise On-Premises Telephone Systems

On-premises enterprise phone systems are telephone systems that are installed and maintained on the organization's own premises. This means that the organization is responsible for purchasing and maintaining the necessary hardware and software, as well as providing the infrastructure needed to support the system.

One advantage of on-premises enterprise phone systems is the level of control that the organization has over the system. This includes control over the hardware and software, as well as the ability to customize the system to meet the specific needs of the organization. On-premises systems also allow for greater integration with other on-premises systems and applications, as they are all located in the same physical location.

However, on-premises enterprise phone systems do have some drawbacks. They can be more expensive to implement and maintain than cloud-based systems, as the organization is responsible for the upfront costs of purchasing and maintaining the hardware and software. On-premises systems also require the organization to have in-house IT staff to manage and maintain the system, which can be a significant ongoing expense.

Overall, on-premises enterprise phone systems are a good fit for organizations that have the resources to invest in and maintain the necessary hardware and software, and that requires an important level of control over the system. These systems can be a good option for organizations with specific customization or integration needs that cannot be met by a cloud-based solution.

Enterprise Cloud-Based Phone Systems

Cloud-based telephony systems are hosted and managed by a third-party provider and delivered over the internet. Instead of purchasing and maintaining on-premises hardware and software, organizations can subscribe to a cloud-based service and access it through the internet.

One major advantage of cloud-hosted telephony systems is their cost-effectiveness. Organizations do not have to incur the upfront costs of purchasing and maintaining hardware and software, and they can often pay for the service on a pay-as-you-go basis. Cloud-based systems are also highly scalable, meaning that organizations can easily add or remove users and features as needed.

Cloud-based enterprise phone systems are also highly flexible, as users can access the system from any location with an internet connection. They offer a high level of reliability and security, as the provider is responsible for maintaining the infrastructure and ensuring that the system is up and always running. Cloud-based systems may also offer disaster recovery capabilities, allowing organizations to continue operations in the event of an outage or other disruption.

Overall, cloud-based enterprise phone systems are a good fit for organizations that want a cost-effective and scalable solution that is easy to set up and maintain. These systems can be a good option for organizations that do not have the resources or expertise to manage an on-premises system, or that require an important level of flexibility and reliability.

Cloud Hosted vs On-Premises Phone System 

When it comes to choosing an enterprise telephone system, organizations have the option of either a cloud-hosted phone system or an on-premises solution. Both options have their own advantages and disadvantages, and the right choice for a particular organization will depend on its specific needs and resources. The following comparison table will help you with the pros and cons of a cloud-based phone system.

Feature

Cloud-HOSTED

On-Premises

Cost

More cost-effective, with pay-as-you-go pricing model

Can be more cost-effective for high usage or high customization

Maintenance and support

Managed and maintained by provider

Requires in-house IT staff to manage and maintain

Integration with other systems

Can be integrated with other systems, but may require additional setup and configuration

Easily integrated with other on-premises systems and applications

Reliability

High level of reliability, with provider responsible for maintaining infrastructure

Depends on in-house IT staff and infrastructure

Security

High level of security, with provider responsible for maintaining infrastructure

Depends on in-house IT staff and infrastructure

Flexibility

Highly flexible, with users able to access system from any location with internet connection

Depends on in-house IT staff and infrastructure

Scalability

Highly scalable, with ability to easily add or remove users and features

Depends on in-house IT staff and infrastructure

Control

Limited control, as organization is reliant on provider for updates and maintenance

Full control over hardware and software, with ability to customize system

Top 6 Cloud Phone Systems Comparison


Ring Central


First on the list is RingCentral, a cloud-based enterprise phone system that offers a range of features including voice and video calling, conference calling, call forwarding, voicemail, and more. With RingCentral, you can customize your system to fit the specific needs of your organization and scale as your business grows. Additionally, it offers integrations with popular business applications such as Salesforce, Google, and Microsoft Office.


8x8


Next is 8x8, a cloud-based enterprise phone system that offers a similar set of features to RingCentral. It is a highly scalable solution that allows you to customize the system to meet your organization's specific needs. 8x8 also offers integration with popular business applications such as Salesforce, Microsoft Office, and Google.


Vonage


Third on the list is Vonage, a cloud-based enterprise phone system that offers a variety of features including voice and video calling, conference calling, call forwarding, voicemail, and more. With Vonage, you can easily scale your system as your business grows and customize it to fit your organization's specific needs. It also offers integrations with popular business applications such as Salesforce, Google, and Microsoft Office.


Avaya


Fourth is Avaya, a cloud-based enterprise phone system that offers a comprehensive set of features including voice and video calling, conference calling, call forwarding, voicemail, and more. Avaya allows you to easily scale your system and customize it to fit your organization's specific needs. It also offers integration with popular business applications such as Microsoft Office, Google, and Salesforce.

MightyCall


MightyCall is a cloud-based virtual phone system that is designed for small businesses. It offers features such as call routing, voicemail, and call recording, and is known for its affordability and ease of use.


Microsoft Teams Phone System


Finally, we have Microsoft Teams Phone System, a cloud-hosted phone service that offers a variety of features including voice and video calling, conference calling, call forwarding, voicemail, and more. With Microsoft Teams Phone System, you can easily scale your system and customize it to fit your organization's specific needs. It also offers integration with popular business applications such as Microsoft Office, Google, and Salesforce.

Below Pricing Table Lists down comparison and approximate pricing based on the following assumptions: -

  • 250 User Company
  • 25 Contact Center users with Automatic Call Recording
  • Unlimited Domestic Calls within the USA
  • Sip Based Hardware Phones (whether Microsoft Certified or not)
  • The company is already using Office 365 or Microsoft 365 for Emails and Teams collaboration
  • Pricing publicly posted on the respective vendor's website

Vendor

Desktop App

Mobile App

Hardware Phones Support

Paging Integration

Compliance Call Recordings

Contact Center Integration

Microsoft Office 365 Integration

Scalability

Minimal Change Management

UCaaS Price (Unified Communications as a Service)

UCaas + CCaaS Price (Contact Center as a Service)

RingCentral

Yes

Yes

Yes

Yes

Yes

Yes

Partial

Highly scalable

No

USD 32 -   per user per month

USD 62  per user per month

8x8

Yes

Yes

Yes

Yes

Yes

Yes

Partial

Scalable

No

USD 15  per user per month

USD 57  per user per month

Vonage

Yes

Yes

Yes

Yes

Yes

Yes

Partial

Scalable

No

USD 15  per user per month

USD 40  per user per month

Avaya

Yes

Yes

Yes

Yes

Yes

Yes

Partial

Highly Scalable

No

USD 20 per user per month

USD 35  per user per month

Microsoft Teams Phone System

Yes existing Microsoft Teams App

yesexisting Microsoft Teams App

Yes

Yes

Yes

Yes

Fully built inside Microsoft Teams

Highly Scalable

Yes

USD 13.5  per user per month

USD 19.5  per user per monthYes

Mighty Call

Yes

Yes

Yes

Yes

Yes

Yes

Partial

Scalable

No

USD 15  per user per month

USD 15  per user per month

Final Thoughts on Enterprise Telephony

Migrating from an existing enterprise telephone system to a new one can be a challenging decision for management to make. There are many factors to consider, such as the cost and effort of retraining staff to use the new system, the potential disruption to business operations during the transition, and the question of whether a more efficient system is worth the investment. These considerations can lead some companies to delay upgrading their system, falling behind as technology continues to advance. To help businesses navigate this process, many are turning to Microsoft Gold Partners like Communication Square LLC for expert guidance in migrating from a PBX system to a cloud-based PBX - Microsoft Teams.

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Last Updated 4 weeks ago

About the Author

Favad Qaisar is Founder & CEO of Communication Square LLC. He is a Microsoft Certified Expert and a Charter Member. In the past he has worked with Microsoft Teams Product Group and has also Co-Authored Microsoft Certification Exams.

Beyond work he loves playing Chess.

Favad Qaisar

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