5 minute read |

Advantages of Hosted PBX Systems

VoIP phone service background
VOIP | VoIP Services

It is practically a universally accepted fact that any new technology will have benefits and drawbacks that have to be carefully balanced to provide value for businesses. Some of the pros and cons come down to the way it is implemented while others are inherent to the technology itself. But while some of the drawbacks can be overcome by innovation and improvements, a few will remain until the systems are replaced, upgraded or made obsolete by the advent of newer equipment/software.

Therefore it is not surprising that many organizations are skeptical about the claims made by vendors regarding hosted PBX systems. How is it possible that a new technology can cost less than older systems, improve existing features and implement new ones and do all of this without needing extensive training for users or employees? If the advantages of hosted PBX systems are a mile-long, then surely there has to be a catch somewhere right?

Do Hosted PBX Systems Have any Drawbacks?

Before we dive into the advantages of hosted PBX systems, let’s get this out of the way. The answer to that question is – yes, cloud VoIP or hosted PBX systems do have some drawbacks. It is not a silver bullet that can magically solve all of the communication issues faced by an enterprise.

Organizations that were early adopters of hosted PBX systems had to make a few compromises in the areas of voice quality, general reliability and a glaring lack of some features that were taken for granted in older PBX systems (faxing for instance). Many of these obstacles have now been solved. Providers even offer the digital equivalent of faxing that not only makes sending documents possible but updates the process to bring it more in line with other business workflows.

But nonetheless, some issues remain. For instance, unlike traditional phones, IP phones require power backup. While some businesses use equipment that have PoE (power over ethernet) ports to keep them working, others simply connect the phones to the on-site generator or other backups.

Another glaring obstacle has been emergency dialing. Even that is slowly disappearing as more vendors implement E911 which is the VoIP equivalent for accessing emergency services. In many countries it is mandatory for VoIP service providers to offer these services – if not by default, then at least by customer choice.

Companies still prefer Hosted VoIP

The laundry list of drawbacks may appear long but there are not more than a handful of issues that have not yet been solved. Why then do companies still prefer hosted PBX systems? It is simply because their advantages greatly outweigh the few drawbacks that still remain.

The Advantages of hosted PBX systems


Cost is the primary reason why most businesses switch to hosted PBX systems in the first place. Even if you include corporate discounts and lower charges for bulk calling, traditional phone companies cannot compete with VoIP service providers when it comes to cost per call. The cost savings are realized in two major ways –

  • Most calls between users within the same enterprise are free through VoIP. It can easily result in substantial savings if the company has employees working from multiple locations or many offices distributed across a wide geographical area.
  • Long distance calls becomes significantly cheaper. Since VoIP routes audio calls through the Internet, it doesn’t matter where the call originated from or what its destination is. Hosted PBX is largely location agnostic and many vendors even offer free unlimited calling to a few countries in various plans.

No maintenance

By the very nature of hosted PBX, the organization eliminates much of the time and other resources required to maintain its own communication system. There is no need to repair the hardware, upgrade equipment or troubleshoot problems when they occur because all these issues are taken care of by the third-party VoIP vendor.

Not only does this cut down on communication related expenses but it allows employees to concentrate on their work, instead of maintaining the phone system.

Easy setup

It is almost comically simple to get started with hosted PBX systems. As long as the business has a reliable and fast Internet connection, IP devices that can make the calls and a data network that can handle additional voice traffic, there are no further requirements to use cloud VoIP.

Clients don’t have to wait for the company to send out technical personnel who will set up the system, change settings or configure the software. Businesses can be up and running with hosted VoIP in just a few days. That’s a huge step up from back when you had to spend weeks just designing a solution that will work for your company!

Employees don’t need training

When implementing new technology, organizations frequently failed to budget enough time and resources to train their employees on using it. Inevitably work gets delayed because users have to learn the new workflows. Hosted PBX systems don’t have that issue at all. There is absolutely no change in behavior or use needed to make or receive phone calls. Naturally to take advantage of some of the more advanced features, users may have to change a few settings but for the most part, it is plug-and-play.

Flexibility and scalability

Hosted VoIP vendors do not require contracts, unlike traditional phone companies. Organizations are free to switch providers if they want better features or prices. The intense competition among providers for getting new customers doesn’t hurt either.

Another benefit is that companies do not have to worry about the phone system scaling up or down as the business grows or shrinks. Resources – lines, numbers, seats – can be added or deleted at any time. If the business experiences a sudden increase in demand, new phone lines can be provisioned quickly to handle customers. Conversely, existing lines can be removed if the business is going through a lean period.

Hosted PBX systems may not be a magic solution but it may be the best bet for enterprises that want to build a communication backbone that will serve them for many years to come.

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Thousands of businesses across the world trust VoIPstudio for all of their most vital business communications. Why not be the next?

Thousands of businesses across the world trust VoIPstudio for all of their most vital business communications. Why not be the next?

Start a free 30 day trial now, no credit card details are needed!