Comparing Cloud & Premises-based IP Telephone Systems
We are seeing an increasing number of businesses move to IP telephone systems, otherwise referred to as VoIP or Voice over Internet Protocol phone systems. The main challenge when buying an IP phone system, is whether to go for a premises-based or cloud-based system. Simply put, a premises-based IP phone system is one that is housed and maintained on your premises and a cloud-based system is one that is housed and maintained by a specialist provider, to which you connect via your internet connection. There are pros and cons to both, the best option for you will depend on the size and specific requirements of your business.
Upfront Cost
Cloud phone systems typically have no, or very low, upfront costs. Instead, you will pay a monthly fee for the service and this is normally charged on a per-user basis. In contrast, a premises-based phone system will have a reasonably high upfront cost because you will have to purchase and set up the equipment. However, you won’t have to pay a recurring monthly fee because you will own and manage the equipment yourself onsite. Due to the per-user pricing structure associated with cloud phone systems, it becomes more cost-effective to invest in your own equipment once you exceed a certain user threshold. For this reason, cloud phone systems tend to be more attractive to small businesses with up to 15 users. Having said this, cost is not the only important factor; many larger businesses still decide to opt for a cloud phone system because of the other advantages it offers. It’s sensible to weigh the unique needs of your business and consider all of the other factors as well as cost.
Total Cost of Ownership
Cloud IT telephone systems have a much lower total cost of ownership, compared to premises-based IP telephone systems. This is because the provider that hosts the system is responsible for the maintenance of it, saving you the need for additional IT staffing costs. This is a further reason why small businesses often benefit the most from hosted telephony services. Having said this, however, it’s important to note that, technically, the equipment is owned by the provider and is effectively rented by the business using the service.
Features
One of the most important factors to consider when buying any new phone system is the features it offers because this will determine what you can and cannot do with your system. It is not uncommon for premises-based IP phone systems to be more feature-rich than the cloud-based alternatives. Or, you may find that important features come at an additional cost with a hosted system. The key point here is not that cloud phone systems are not feature-rich, but rather that it’s important to compare what’s on offer with the services offered by different providers. If you’re going to opt for a cloud phone system, make sure that the provider you choose offers an extensive range of advanced features at no additional cost.
Scalability
When buying any new phone system, it’s really important to consider how your business may grow over the next few years. Any potential growth should impact on your purchasing choice. As mentioned earlier, you will need to seriously consider the cost factor if you are likely to exceed the cost-effective user threshold for hosted phone systems in the near future. However, the good thing about the cloud-based option is that it is extremely easy to add and remove users from the service; this can be done instantly via an admin web portal for complete convenience. If you are going with the premises-based option, it’s sensible to choose a system that offers sufficient room for growth. Buying a system that only meets your current needs is not cost-effective because you will only find yourself having to replace it a year or so down the line.
If you’re looking for IP telephone systems in Birmingham and the surrounding areas, contact Midland Networks. We can supply both premises-based IP phone systems as well as offering a unique hosted telephony service. We can also offer expert advice to help you decide on the best phone system for your business.