Cloud/Hosted VoIP Phone Systems vs. Premise Based VoIP Phone Systems

Cloud/Hosted VoIP systems, also known as “UCaaS” have become a preferred choice for many that are looking for a new voice solution for their offices. And on the surface it’s easy to see why. In most cases there is a small initial investment, one bill for equipment and service, the entire solution managed entirely by your hosted provider, latest technology, etc. There are advantages and disadvantages to both cloud/hosted VoIP as well as the traditional premise based VoIP design that should be considered before investing in a new solution for your office. Office Telesystems has taken this into consideration, which is why we offer both cloud and premise based options.

Advantages and Disadvantages to Premise Based and Cloud/Hosted Solutions

Premise Based (server on site) VoIP Solutions (CapEx or OpEx)


Favorable total cost of ownership long term for a few sites
Security/Control of network
Control of your own equipment, service
Comparable feature set to hosted
High quality desk sets
Higher level of equipment support/dealer support
Life span‐once purchase or lease is completed, retain benefits of equipment as long as your own, no equipment payments (the average phone system lifespan is 7-10 years)
CapEx or OpEx financing options
Remote worker options


Upfront equipment cost for CapEx/cash purchase (OpEx lease can offset this)
Integration to separate services provider, 2 or more bills
Cost of professional services added to initial CapEx
Cost of upgrades (wrap into your lease to offset this)
Older equipment outdated or no future upgrades available (Make sure your equipment is NEW or supported by manufacturer and provides software updates)

Cloud/Hosted VoIP Solutions Pros and Cons (OpEx)

Product Flexibility
Low cost initial investment
Multi-site integration, national or global
Lower short term total cost of ownership
Easy call transfer back and forth to other offices, remote users
Bundled payment plan for both equipment and service in most cases
Quick, easy disaster recovery
Easy to relocate endpoint devices, remote workers
Robust software applications for call center, CRM integration, advanced features

Higher long term total cost of ownership
Desk phone upgrades and feature set upgrades significantly increase monthly cost
Significant network upgrades required in some cases
Most require minimum 3 year contract term, auto-renewal
Longer response times for on site service, warranty replacements

Both options have their advantages. Contact our expert sales team for more information.

Office Telesystems offers both on premise and cloud/hosted VoIP! Request a quote or contact us today. (972) 484 4900 or (817) 529-1700.