Discover the most frequently asked Phone system questions

What is the difference between hosted and on premise PBX?

On-site installation vs online solution

Hosted and on premise PBX are two different types of private branch exchange phone systems. The basic difference is that on premise PBX requires the on-site installation of PBX hardware, and hosted systems do not, as they are completely operated online and therefore necessarily work using voice over IP. 

With hosted PBX systems, the provider is responsible for housing the IP-PBX as well as providing and managing the technology required. Users just plug their IP-PBX into their router, and all communications are managed through the provider’s servers. These systems are charged on the basis of a flat monthly fee including a certain number of call minutes, plus extra communication fees. 

On premise PBX systems need proper hardware to be installed within the enterprise’s premises. IP phones are connected to an IP-PBX server using a LAN. VoIP is made possible by using SIP trunking, and gateway cards are needed to connect the enterprise phone system to the traditional phone company provider. Asterisk-based systems are the most affordable on premise systems, as the software used is open sourced.

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Advantages of hosted PBX

-  Scalability, as new features rely on the provider’s resources rather that the resources of the user,

- Ease of installation of new extensions, numbers and features,

- Mobility, as the enterprise system can be accessed from anywhere with an internet connection,

- Redundancy, back-up solutions and systems are used in the case of loss of internet.

Advantages of on premise PBX

- Greater user control, for example, to adjust and delete users,

- No need to change the current telephone carrier,

- Costless open-sourced additional features,

- Long-term savings with server ownership,

- Providers will train staff to use the system.

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