Net Tel One
- Jul 24, 2017
- 2 min read

Premise-Based PBX or Cloud-Based PBX

Which PBX is right for your business?

When business owners are considering upgrading their phone systems, the question arises, “Premise–based PBX or cloud–based PBX?” Let’s take a look at the differences to help you decide which is best for your business, as explained by Small Biz Club.

Cloud PBX

This is also known as an internet phone system. A cloud PBX provider controls the system and its technology. The provider’s server routes the calls to your location.

This system makes it much easier to add new features which is the responsibility of the provider, not you. Any loss of internet service will not affect your phone system. Also, a cloud PBX can easily be moved from one location to another.

Premise PBX

This system is set up at your business location. Calls are routed through the phone as well as through the internet using SIP (Session Initiation Protocol) trunking. SIP trunking is a direct connection between your business and the internet service or phone provider.

The premise PBX gives you full control over your system and you can add or remove users as needed. If the internet goes down, the SIP trunking calls can be sent to another phone or mobile phone.

Additionally, you don’t have to change your existing carrier with the premise-based system. Over time, ownership of the server will save you some money.

Cost

The cloud PBX is typically less costly than the premise system since it requires less equipment.

With the cloud system, only internet provider phones, a router and a network switch are needed. The provider takes care of the server, system hardware and routers. A monthly fee is charged that includes minutes and special features.

The setup cost of the premise-based system is higher than the cloud PBX. The premise system requires a server and interface cards in order to connect the telephone company and the IP phones. However, monthly charges for the premise system is usually lower than the cloud PBX. But, server maintenance is your responsibility.

Scalability

The premise PBX system allows easy expansion if you need to grow your business. You just buy more phones and add them to the system.

In contrast, the cloud system requires you to add more phones to your service plan and program these phones, adding to your monthly cost.