With the decision to move towards Voice-over-IP telephones usually comes an immediate 
follow-up question: Should we use hosted or on-site phone system hosting? It's a question we hear from our own clients frequently.If you're new to the technology, there are two major elements: The hardware, and the actual phone service.
The Basics Needed For A Move To VoIP
Moving to Voice-over-IP isn't as simple as changing phone service providers. A VoIP migration often requires new telephones, and potentially other on-site equipment, as well as changing service providers.
Of course, that's one of the main benefits of a switch to VoIP - you're no longer paying a telephone bill for copper-wire phone service. Cutting out the traditional phone companies means an immediate drop in your ongoing telecommunications costs.However, you're still left with the decision regarding who hosts the telephone service.
This requires a specialized device called a PBX, which is what allows your digital calls to transition onto the larger phone grid. So, it's ultimately a matter of who controls the hosting software and equipment. There are advantages to both strategies.
Off-Site Hosting - Paying A VoIP Service Provider
For many just getting into VoIP, it makes sense to begin with an off-site host. They usually make the transition quick and easy, with recommended equipment and streamlined setup.
Then, for a monthly fee, they handle the operations of your phone systems. The arrangement is pretty similar to that of your old phone companies, although with much lower monthly bills...at least at first.
Hiring a hosted VoIP provider also is less expensive up-front, since it requires less of an on-site hardware investment. If you lack any specific on-site tech support staff, it may also save you a hire or two.
There are still some significant drawbacks. First, it does mean you're relying on an external provider to run and manage your telephone system. As your telecommunications systems grow and you move further towards unified communications, that may create a bottleneck in your expansion plans.
Secondly, these services generally price on a per-user basis, which means that the monthly costs can escalate quickly over time, as you add employees and other users.
The result is that if your business has more than around five people, an on-site hosted solution starts making more long-term financial sense.
On-Site PBX Hosting: Taking Control Of Your Telecommunications
If you choose to host your own business VoIP service, it will mean more costs up-front, especially for the PBX hardware. Dedicated IT support is needed as well, since an on-site solution means your network, communications, and Internet are all part of the same system. If your firm can overcome these initial hurdles, on-site hosting brings a number of further advantages over a hosted service. 
-
No ongoing service costs. Your only monthly bill is for your raw bandwidth, with no middlemen.
-
A much lower TCO on the long-term investment.
-
Direct administrative control over your phone systems at all times.
-
Simplified on-site unified communications implementations.
-
Expanded user options, such as individually-customized IVR systems.
-
Freedom to pick the exact systems and hardware you want, not just those compatible with your service provider.
On-site phone systems hosting gives you total control over your own telecommunications.
Finding The Right Host When Moving To VoIP
Whether you choose a hosted service, or host yourself, VoIP provides immediate and ongoing savings over traditional telephone services. However, for businesses with more than a half-dozen employees or so, starting off with an on-site solution ultimately provides the greatest cost benefits.Most companies are ultimately going to outgrow hosted VoIP services. Increasingly, it just makes more sense to go ahead and start out with an on-site solution to begin with.
Has your company transitioned to VoIP lately? Which route did you take, and how did the upgrades go?
