Cloud or on-premises phone system

A badly chosen phone system is paid for twice: on the monthly bill and in dropped calls. The decision between cloud and on-premises comes down to one question: for how many years will you use the system? With a short horizon, or dispersed teams, the cloud almost always pays off. With a long horizon and everyone in the same building, an on-premises PBX usually ends up cheaper, and the tipping point generally comes between the 3rd and 4th year. There is also a third option few people propose.

Which three facts decide the choice of phone system?

The tipping year Around the 3rd or 4th year, the on-premises model starts to pay off.
The middle ground Keep the PBX in the building and move only remote extensions and queues to the cloud.
The network Voice over IP requires traffic priority; without it, no model works well.

How do the two models compare, criterion by criterion?

Criterion	In the cloud	In the building
Start-up	Low investment: handsets and installation only	High investment: hardware and licences
Every month	Pay per extension	Pay for maintenance and call traffic
When it pays off	From the first month	Around the 3rd or 4th year
New versions	Arrive automatically, at no extra cost	Scheduled and paid for by you
More or fewer extensions	Adjusts month to month	Tied to the licences you bought
Several offices	One PBX serves them all	Needs links between sites
Working from home	The extension works wherever there is internet	Requires VPN or secure publishing
Internet down	The PBX stays up and diverts to mobiles	Internal calls continue; external ones stop
Power cut in the building	No impact on the PBX	Stops, unless there is an adequate UPS
Recordings and data	Held by the provider, under a processing agreement	Held by you
Integration with local systems	Feasible, depending on the provider	Complete, even with legacy equipment

When is the cloud the right decision?

Up to around 50 extensions Without special integrations.
Dispersed teams More than one office or people working from home.
Zero hardware A predictable cost per user and no rack space used.
A move on the horizon If you will change premises soon, the PBX moves with you without works.
Seasonal teams Extensions that open and close during the year.

When does an on-premises PBX come out ahead?

Many extensions, many years Over five years, the savings add up.
Recordings kept in-house Isolation or internal retention requirements.
Local systems Production lines, gatehouse, intercoms, legacy equipment.
Hotels and healthcare Direct integration with management software installed on site.
Fragile internet With no acceptable alternative connection.

Why does almost nobody propose the hybrid model?

Because it suits neither kind of salesperson. In the hybrid model, the PBX stays in the building and only remote extensions and call queues move to the cloud. For those who bought a PBX recently, it is often the most financially rational option.

What is the most expensive mistake in this decision?

Choosing the model before auditing the network. IP voice degrades on networks without QoS, unmanaged switches or an internet connection shared without rules. In the cloud, the symptom is drop-outs and silences; on premises, it is the same. That is why we carry out the same check as in any network infrastructure project. Discover the IP PBX managed by DataRoad: installation, number porting and support, in both models.

Questions from decision-makers

Is a cloud PBX more vulnerable?

Not in itself. Properly configured, both encrypt calls. What changes is who is responsible for the infrastructure and what the data processing agreement says. A forgotten on-premises PBX exposed to the internet is far more dangerous than a managed cloud service.

If I choose now, am I locked into that model?

No. IP handsets usually work in both models and your numbers move with you. The loss lies in on-premises licences paid for ten years, which is a reason not to overdo the first investment.

Does our old analogue or digital PBX go in the bin?

Not immediately. It connects to a gateway and extensions migrate in phases, rather than all in one weekend.

How many simultaneous lines should we contract?

Between 25% and 33% of total extensions, as a starting point. Sales and customer service need more; administrative departments, fewer.

Want to see the comparison with your own numbers?

We calculate both scenarios over five years, with your extensions and your traffic, with no commitment. Read also the real price of a phone system. We provide this service within an IT Unlimited contract: no ad hoc call-outs or standalone equipment sales.

More than 10 workstations · support contract · remote, on-site and telephone support. +351 211 459 950* · sales@dataroad.pt

*Call to a Portuguese landline.

Cloud or on-premises phone system: which costs less?

Which three facts decide the choice of phone system?

How do the two models compare, criterion by criterion?

When is the cloud the right decision?

When does an on-premises PBX come out ahead?

Why does almost nobody propose the hybrid model?

What is the most expensive mistake in this decision?

Questions from decision-makers

Want to see the comparison with your own numbers?

One StepAhead of IT.

Let’s talk about your operation.

Cloud or on-premises phone system: which costs less?

Which three facts decide the choice of phone system?

How do the two models compare, criterion by criterion?

When is the cloud the right decision?

When does an on-premises PBX come out ahead?

Why does almost nobody propose the hybrid model?

What is the most expensive mistake in this decision?

Questions from decision-makers

Want to see the comparison with your own numbers?

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One StepAhead of IT.

Let’s talk about your operation.