The topic on which PBX plan to go for has always been hotly debated.
As a UCaaS provider, it is important for you to realize each of their strengths and weaknesses as well as the major differences between a cloud-hosted option and an on-premise one and which businesses desire what kind.
Mastering these facets of the telecom industry will help produce greater overall customer satisfaction, so let’s get to learning, shall we?
Why Do Up And Coming Businesses Like The Cloud?
UCaaS is the preferred option over an on-premise solution for a variety of reasons. Here are some of the main ones.
1. It Scales Better
The core reason behind a preference for a hosted solution in newer businesses is the scalability.
Clients can start small and then scale their options according to budget and business growth.
It allows for better management overall without wasting funds on things that are not needed at the time.
Plus, adding new users to an existing setup takes no time at all in comparison to an on-site installation which would require adding extra hardware on the premises.
2. It Takes Up Less Physical Space
Leading with that, the constant work that would need to be done for a growing company would start taking up a lot of the existing office space due to constant installation work. Not to mention needing to find room for a physical server to reside in the office building.
A lot of new businesses do not really have that kind of space and they have to optimize as best they can to make sure they remain profitable.
3. It Is Cheaper At A Base Level
Speaking of profit, a cloud-based solution is cheaper by default. The upfront cost is quite small compared to an on-premise option simply because there is no mandatory hardware that needs to be obtained aside from IP phones.
And, adding new users to the network is cheaper on a per-user basis too.
4. It Is More Flexible Than An On-Premise Solution
The flexibility of a UCaaS solution already comes from its scalability, however, there is also the fact that a lot of these modern businesses have workers who work remotely or have a hybrid work setup.
An on-premise solution is limited to its hardware more often than not as it usually is a closed system that only covers the building.
Meanwhile, a cloud hosted solution offers users with the right credentials access to the network remotely, letting them work from anywhere with a stable internet connection due to no hardware limitations.
5. It Requires No Setup Or Maintenance From The Client’s Side
Finally, there is no extra work that needs to be done by the client aside from negotiating the deal.
The setup for a UCaaS PBX option is done by the host as is the job of security and maintenance. The client pays for the subscription and reaps the benefits, keeping operation costs low and not needing to create a new department to manage the PBX server.
Why More Seasoned Businesses Like An On-Premise Solution
A cloud system is all well and good and its benefits may paint an on-premise PBX option as something inferior, but it does have its own merits too.
All it comes down to is a matter of business structure and preference on a case by case basis.
Here are some of the main highlights of an on-premise solution.
1. The Client Owns It
While a somewhat aged preference, some clients simply do not enjoy being glued to a subscription and having to rely on outside factors and third parties for their business performance.
Even if it costs them more upfront, they prefer having all the moving parts in-house (the server, in this case).
The business likely has an idea of where to house it without causing any particular workflow disruptions and has a team ready to take care of it.
2. It Offers More Customization Options
Having the PBX server in-house allows these teams to maintain server uptime and security in real time without having to worry about a service-wide outage that may overburden their provider if they were on a cloud-hosted option.
While those rarely happen, having a team at the ready that can start working on removing the issue at hand lets these clients breathe easier knowing they will have minimal downtime.
3. There Is Less Latency
Another obvious benefit of an on-premise PBX solution is the proximity of the server to the business itself.
The larger the distance, the more latency there is between calls and inputs, whereas a server being right in the office means that there is virtually no latency to speak of, greatly improving response time and call quality.
4. The Business Controls The Whole Process
From server location to issue-solving in-house and planned update, the client gets to be in charge of the whole process.
They get to dictate the times at which updates are applied to the system, what features they add and how well everything functions.
A good service provider will cover all of that in a cloud-based system too, certainly, but sometimes clients do not find exactly what they need in any package.
An on-premise solution allows them to tweak this to their benefit through custom security fixes and the like.
Plus, it feels better knowing that they have a team they can trust to be on top of things.
And, depending on how they manage it, the costs of an on-premise PBX system can end up being lower in the long-term than a UCaaS solution would be.
But Which One Is Better?
That is the trick, it depends on the type of business that the client operates.
A cloud-based PBX option offers more flexibility for the worker and relieves a lot of setup and maintenance woes from the business itself.
It is also cheaper and it scales better which makes it the better choice for small to medium sized businesses that are still looking to gain a proper foothold in their respective field and grow some more.
An on-premise solution, on the other hand, is more reliable if the client has a team dedicated to managing it and creating custom solutions that fit their specific business needs.
It also offers better response times and the client owns the whole thing, not to mention that, even in an outage, IP telephony will still function on the premises.
While none of these sound particularly exciting for a newer business, it is an option that a lot of well established businesses prefer for their communication needs.
That is why, there is no definitive answer as to which of the two is better, they just fit some businesses better than others.
What is important is that PBX service providers can recognize these businesses and utilize an adequate marketing strategy on the fly.
Just A Matter Of Preference
Naturally, there are exceptions to the rule, but one needs to read the room to understand this.
It is still best to lay out the benefits of both systems to the client and see which of the two they resonate the best with, then continue pitching the better option of the two.
If one can manage that, they are sure to come to a satisfying deal for both parties.
For those who wish to learn more about the differences between the two, feel free to Contact Us or to Request a Demo to see the capabilities of our two different PBXware deployments.