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Hosted vs Owned

Hosted VoIP System - User Owned Premise System Comparison

Hosted Telephone Systems has been a popular choice recently, especially during the recession. It can sometimes offer more features to small clients at a lower initial cost, and relieves the customer of responsibility for system maintenance.

Premise based Telephone Systems are the more traditional model, and are usually less costly over time. They allow the customer ownership of the asset, and more direct control over it.

There are many Pro's & Con's to both types , so a careful look at some of these points is advised before making any decision involving your system. A cost / benefit analysis is always a good tool as well! Here are the major points as we have been able to compile using a wide variety of industry sources.


Hosted Owned
  • Many advanced features are available, even for small sites
  • It is not always easy to give small systems access to all features
  • Some typical PBX features do not work on hosted systems.Ie: Paging over speakers, forwarding phones, etc.
  • Features are typically a one time cost and cover all users
  • All typical PBX features will usually work, and buttons can be programmed to simulate a traditional PBX with enhanced ability
  • Lower initial cost, less investment in system
  • Higher initial cost, but can be a monthly payment on a lease
  • Monthly cost of hosted service never goes away
  • Monthly cost of lease ends, resulting in ownership & no payments
  • Customer is not responsible for controlling the system. Upgrades, changes & backups are taken care of. Customer staff is not required to be actively involved with the system
  • Customer gets to control the system. Upgrades, changes, adds & backups must be scheduled. System changes must be done by either the vendor or customer staff, sometimes at a one time cost
  • Customer doesn't control the system.
  • Customer must take responsibility for controlling system
  • Tends to use more bandwidth and LAN resources
  • Keeps bandwidth to a minimum & may or may not even effect LAN
  • Phone system resources are off site and use Internet
  • Phone system resources are local and not dependent on Internet
  • ADD users or features by calling vendor or managing locally
  • ADD users or features by calling vendor or managing locally
  • There is a recurring monthly cost per new user or feature
  • No "per user" or "per feature" charge. Non-recurring
Phones & Buttons
  • Phones are generic IP phones (such as Polycom), which limits the features that can be done from a phone
  • Phones are typically designed to match the system, which allows a more powerful feature set on the phone it's self
  • Phones typically have few buttons and only the primary features. Most features are accomplished with a desktop application, which can prove daunting for some people
  • Features can be accomplished with either buttons on the phone or desktop application. This can give more of a feel of a traditional system with the option of accessing features on the desktop
Disaster & Recovery
  • Hosted system is better suited for disaster recovery
  • Premise PBX recovery may take longer for system replacement
  • Single point of failure. When Internet Access is down all phone functionality ceases, including station to station calls
  • Premise system is not dependent on the Internet connection, and multiple types of lines can be used for redundancy



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Actior is the premier provider of sales and installation of voice over ip (VoiP) and IP business phone systems for St. Paul, Minneapolis, and the greater Twin Cities area in Minnesota. We also provide a list of VoIP phone Equipment for business in St Paul, Minneapolis, the Twin Cites and Minnesota.

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