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Is Premise-Based VoIP Becoming Obsolete?

November 16, 2017

There is speculation in the technology industry that the premise-based salesman is going the way of the fax salesman of 1990s. While fax technology was still useful, the digital alternatives and the use of email were just such an improvement it seemed incredibly wasteful to continue trying to spread the technology. The upside of cloud hosting is certainly compelling in a similar fashion. Does hosted phone make on-premise VoIP a communications dinosaur? The answer isn’t simple.

First, let’s establish what the differences between the two are.

On-Premise VoIP

On-Premises phone systems are typically deployed at your office(s) or data center. Generally, you purchase and own the hardware required and install it on-site, including appliances, servers, interface cards, etc. Your in-house IT staff is responsible for all changes, updates, maintenance, etc. Your company will also supply voice service to the system via analog, PRI or analog POTS service (which is also more of yesterday’s technology vs. SIP or Hosted Phone Systems


Hosted, or Cloud-based phone systems, are deployed by a hosted provider in an off-site data center. There is a monthly fee for access via a public or private internet connection. Your company will pay a monthly fee to use the system, which is connected to your office via a public or private Internet connection. You may need to purchase the desk phones. You have some control over moves, adds, and changes but your provider performs all updates, maintenance, and supplies voice service.

Which deployment is better?  That depends on several factors, most often related to the size of your business.

Small Firms

Smaller companies are generally more willing to host their network on a secure private cloud, which removes the threat of multi-tenancy. These private clouds allow some internal control while maintaining immediate scalability, so a spike or fall in demand or production isn’t subject to the constraints of an on-premise system. Additional benefits include the ability to remove the burden of server maintenance and software updating from IT, and overall lower cost of ownership.

Mid-sized to Enterprise Level

Larger firms historically host on-site simply because they have the resources to do so and would prefer to keep all control in-house. They also tend to be more risk averse, and with change comes risk, so changing critical systems from on-site to hosted can be met with adversity. Generally top amongst those fears is that of security. However, the tide has changed. In September of this year Amazon Web Services gained authorization to host critical data from the US Department of Defense. This is a major exhibition of faith in the security of the cloud. It is expected in 2017 that over 50% of all phone systems purchased are going to be hosted phone systems.

Your answer depends on your business.

You may be trying to get the most of your existing hardware investment, so hosted is not yet fully an option for you. However, when you move to a hosted phone environment you are able to eliminate existing telecom / technology assets that you have in place today with an on premise phone system. At the end of the analysis we often see hosted phone service providing greater benefits to our clients and frequently a cost savings as well. Alternatively, you may be ready to make the hosted move entirely.

Regardless of what you’re ready for, Corporate Technologies Group will help you find the solution and the providers that will ensure your phone systems work at peak efficiency, maximizing your investment and streamlining your communications. Contact us today.

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