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Advantages and Drawbacks

Choosing a hosted PBX service provides advantages in several areas where traditional PBX phone systems are weakest:

  • Overall cost. Your initial investment in a standard PBX could easily hit $10,000 and can go much higher. In addition, the lifespan of a typical installed phone system is only 5 to 7 years – at that point, you have to make the investment all over again. As you'll see on our Pricing page, hosted systems are priced per user per month, allowing you to spend only for what you need as well as spreading your costs out evenly over time.
  • Management. Web-based administration tools are the norm for hosted PBX services. Adding new users, changing extensions, and changing hunt groups or call queues is as easy as a point and click. Not only does this make you more responsive, it eliminates the need for expensive service calls, further adding to your cost savings.
  • Remote employee support. With hosted PBX services, employees who work out of branch offices or even their homes can get access to all the functionality of the main phone system – without very little hardware or special setup. As long as they have broadband Internet access – and virtually all remote workers do – every employee can have an extension on the main phone system and access to all the same features.
  • Mobile user support. No longer will your traveling employees feel out of touch. The right hosted PBX service can make their cell phone into a seamless part of the company telecommunications infrastructure: calls to their extension will ring through to their cell, and they'll be able to transfer and forward calls as usual. Mobile users can also take advantage of the soft phone, a software-based solution that turns their laptops into corporate phone extensions.
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There is one main disadvantage of a hosted PBX service, and that is its dependence on your Internet connection. While the average corporate Internet connection is extremely reliable, there's always the risk of a virus, network problem, or other interruption taking you offline, even for a short time.

While you may be prepared to deal with the loss of their Internet service for a short period of time, you might find that being unreachable by phone is more difficult to swallow – even for an hour. Dedicated telephone hardware is engineered to be completely reliable and, short of a construction crew cutting the phone lines outside your building, will hardly ever suffer an outage.

Hosted PBX services have an outage advantage, however. When your Internet connection goes down, your staff won't be able to make or receive calls. But callers dialing in will still reach your fully customized PBX, since it's located at the service provider's data center, not your office. That means that even if your office is completely out of touch, callers will still be able to hear recorded messages and leave voicemail. This considerably minimizes the impact of any outage.

A less common but still important disadvantage of hosted PBX services is for large call centers. Typically, high-volume call centers want the greatest degree of control, flexibility, and reporting from their phone systems, and the best approach for these needs is an on-premise solution. Hosted PBX can work well for smaller call centers, but if yours has 25 or more agents, you'd be best served sticking with a traditional phone system.

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