Why do some businesses prefer an IP PBX phone system to hosted VoIP?

There are two major options when considering VoIP; a hosted system, or an on-premises deployment. An on-premises system starts with an IP PBX, the main piece of equipment that manages phone traffic. A hosted system lets a third party take care of everything, and the remarkable simplicity of the hosted option may give rise to the question, “Why use an on-premises IP PBX at all?” For some small companies, the choice is immediately obvious, and hosted will be the best option, especially for SOHO companies with only a few phone lines. But for many others, the choice is not so simple.

The feature set is not as big of a differentiator as it once was in the early days of VoIP, and hosted service providers offer an impressive selection of VoIP features and functions. In fact, for a very small company, the hosted option is an excellent opportunity to gain access to these high end features, without having to bear the expense of deploying them internally.

Ongoing costs are lower

There are however, several arguments for an on-premises deployment of an IP PBX, especially once a company gets beyond just a handful of trunks and extensions. The biggest argument for an IP PBX is the month-to-month cost. Although there will be a larger up-front burden in purchasing and installing the PBX, if a company is able to shoulder that burden, the ongoing monthly expense is likely to be less. Think of it as an investment. The hosted option may give you the advantage of no up-front fees, but it will also give you higher monthly and per-minute fees than would the on-premises option.

More control with IP PBX

If you have the in-house talent to manage it, deploying an IP PBX in-house does give you much greater control over your telephony environment. In a hosted environment, the third party provider retains control over your telephony, and in a smaller company, this may not be a bad thing. But the IP PBX does give greater control over all the details of your telephone environment, so that you can more easily control features, expansion and scalability, security, and other factors; as well as retaining control over routine daily functions such as adds/moves/changes. Fortunately, many IP PBX vendors provide an easy management utility so that the IP PBX can be managed with a web interface.

More flexibility with IP PBX

A hosted service provides you with a menu of services from which to choose. For companies with basic requirements, this is often more than adequate. However, the hosted provider is less likely to be able to provide custom solutions to meet unusual requirements. When deploying your IP PBX in house you retain a great deal of flexibility.

Integration and CTI with IP PBX

A major reason many companies deploy an IP PBX instead of a hosted system is to take advantage of computer telephony integration (CTI) possibilities. Organizations with large customer-facing departments, such as call centers, benefit from this capability, which allows the IP PBX and the array of telephony functions it provides, to integrate directly with other third-party applications. This level of integration would not be possible through a hosted system.