Prem PBX vs Cloud PBX: The Ultimate Showdown

I’ll begin by acknowledging my bias: I’m a big fan of cloud solutions for various reasons, which I’ll delve into shortly. However, for the sake of this article, I’ll endeavor to set aside personal preferences and offer an impartial comparison.

Let’s start with a brief overview of each solution and how it operates. A premise-based PBX is exactly what it sounds like. In the backroom of your office, you’ll find a box (the PBX), essentially a computer, that manages all your phones and connects to incoming phone lines from your provider. Whether you’re making a call or dialing HR, this PBX computer handles it all. This setup has remained consistent for over 50 years and has proven to be reliable, provided your building has power and the PBX doesn’t encounter hardware or software issues. Here are some advantages of a Prem PBX:

• Prem PBX is often cheaper to maintain and less costly overall.
• It excels at providing basic communication affordably.
• Internal calls work reliably, regardless of your internet connection.
• If you prefer capital expenses, this solution suits you.

Now, let’s shift to the cloud PBX. A cloud PBX typically only has phones (or a PC app for softphones) on-site. Everything else is hosted in the cloud. For the sake of this discussion, we’ll ignore distinctions like private cloud vs. multi-tenant cloud. In a cloud PBX setup, every call, even those to your nearby coworker, is managed by the cloud PBX. This reliance on the internet does present a single point of failure. If your internet connection goes down, your phone system goes with it. But in today’s cloud-centric world, if your internet is out, chances are many other office functions are affected too. Here are some advantages of a Cloud PBX:

• Location becomes irrelevant. With an internet connection, you’re operational from anywhere.
• Cloud systems offer multiple usage options like PC softphones, mobile apps, and physical phones, all without the complexity of a premise system.
• Maintenance-free: No need to worry about upgrades or security patches, as these are typically handled by the cloud provider.
• Predictable budgeting with a consistent monthly invoice.

Let’s now discuss the evolution away from premise-based PBX systems toward SIP Trunking. In the past, homes and businesses relied on dedicated phone lines, typically copper wires, ensuring reliability even during power outages. These copper lines, some laid over a century ago, are now experiencing various forms of decay. Consequently, providers are moving away from them, aiming to transition entirely to internet-based solutions, leveraging the newer fiber optic infrastructure replacing the old copper lines. Thus, traditional copper POTS lines or PRI’s are being replaced by internet-based SIP trunking.

You might wonder why this transition matters. The significance lies in the fact that even with a premise-based system, reliability isn’t guaranteed since it still relies on the internet to provide the necessary trunking for both incoming and outgoing calls. This underscores the importance of recognizing that even a premise-based system ultimately depends on the internet for its trunking needs.

While every business has unique requirements that may sway the decision towards one solution or the other, this article aims to provide a general overview applicable to most businesses. For specific industry-related queries, consulting with experienced companies like Techmode, who deal with both PBX types, is advisable. Remember, there’s no one-size-fits-all solution, so maintaining open communication with a trusted provider is crucial.

If your business primarily focuses on basic calls without future enhancements like call centers or webchat, a Prem PBX might suffice. However, for those seeking convenience, reliability, and scalability to address evolving business needs, the Cloud PBX is often worth the investment.

Please click here to read my personal thoughts on hosted vs prem.