Skip to main content

«  View All Posts

Cloud Solution vs. On-Premise Phone System: Which is Better?

February 28th, 2024 | 5 min. read

By Marissa Olson


Running a successful business can prove to be daunting but it doesn’t have to be as bad as you may think. Choosing the right phone technology solutions or comparing a cloud-based vs. on-premise (on-site or on-prem.) phone system to determine which is better, your team members can remain equipped with the tools they need.

Before investing in anything new for your business, you first need to determine how you plan to use it and whether it will make a definite impact on your company.

It’s never a good idea to solely invest in something simply because your competitors are doing it. There’s value in taking your time, analyzing your budget, and checking the direction in which your business is heading. 

If a phone system upgrade is something piquing your interest, you’ll want to be certain about how the product will make work and operations easier around the office.

New call-to-action

Upgrading Your Office Phone System: Cloud Solution vs. On-Premise 

If you’ve finally decided to invest in new a phone system for your business, there are probably some questions running through your mind, like: 

''Do my staff members need a softphone or desk phone?''

“How can I accommodate the needs of both my in-house and remote employees?”

''What features do I need to facilitate speed and consistency?''

''Which phone system should I choose… a cloud or on-premise solution?''

The debate around the best phone system when choosing between a cloud solution or on-premise has been ongoing for years. If you were to ask around, you’d probably have most people tell you that cloud phone systems are the best. To be honest, it really depends on your specific technology needs, though. 

What’s The Cost of Each Phone System? 

Cost plays a significant role when shopping for any product or service, and this case is not an exception. In some circumstances, you may find that hosting your phones in the cloud is more cost-friendly compared to on-premise. 

With a cloud-based phone solution, all you have to do is pay a monthly subscription to gain access. The monthly charges cover all services, including operating costs, maintenance, and system update fees.

On-premise, on the other hand, typically features a high setup cost. Although the price of operation is much lower, it still does not cover up for the hidden fees. You’ll most likely be stuck with having to pay for system upgrades and expansion costs, which could range up to $1000.

Setup and Access: Cloud vs. On-Premise 

One of the main benefits and reasons why most businesses prefer cloud solutions over on-premise is easy setup and implementation. Nobody wants to spend the whole day or even two, waiting for their new phone system to be fully configured and operational. 

Cloud systems are super easy to deploy because every feature is straightforward. Cloud solution systems are characterized by centralized technology and equipment, which are entirely managed by the providers. 

Alternatively, on-premise systems take a lot of time to set up and prepare for use. The systems feature customizable features, and although this is a good thing, the customization process can become complex, and that may cost you extra funds.

What’s The Maintenance of Each? 

If you are a beginner, the chances are that you know little or nothing about phone system maintenance. Cloud is a perfect solution because you do not have to worry about messing up or paying an extra cost for maintenance. 

A great telecom provider will handle the maintenance for you, hence saving on both cost and time. You can utilize your business IT resources on other tasks and let the providers do what they do best. 

With a cloud-based solution, you do not own the system— it is more like leasing the services, and this gives you peace of mind knowing that you are not liable for any breakdown or operational issues. The only drawback is that you miss out on customizable features because the system is shared across different businesses.

With on-premise systems, you have control over everything. This is an advantage such that you can customize the system to meet your needs. 

However, you need to hire IT experts for maintenance and servicing, which will cost you both time and money. If the IT staff is not knowledgeable about the system, they could mess it up and push you to further losses.


As I mentioned earlier, the cloud solution providers have full control over the system, making it easier to upgrade and expand your phone systems. The process is complex, but the providers know the ins and outs. 

You can trust them for fast services at no extra cost. The software updates are done automatically to ensure that you are always up-to-date. Again, this will save you from causing a mess that could end up costing you more.

With on-premise, you are liable for the expansion and customization of the system. The furthest you can go with this depends on your IT knowledge. What's more? Every feature upgrade and expansion comes at an extra cost.

Data Security of Your Phone Systems

You should never, under any circumstance, compromise your business data security. Many businesses have suffered data breaches and leaking of sensitive data, resulting in massive losses and loss of trust from customers and investors.

Among the primary benefits of cloud solutions is uncompromised security. Telecom technology providers are responsible for all matters, including system maintenance and management. If anything goes wrong, they are to blame. 

You’ll know a great telecom provider if they care about their reputation, as they will not do anything that will put your business at risk. 

The systems feature a centralized control, making it easier to monitor the system and detect any suspicious activity before it's too late. Even better, you do not pay any extra security fees.

On-premise systems allow you to implement security measures of your choice. While this is a good thing, a minor mistake could result in irreversible losses. You also have to pay for those features.

FREE eBook: Ultimate Buyer's Guide to Managed IT Services

Cloud Solutions vs. On-Premise Phone Systems: The Final Say

From the mentioned features, it is evident that the cloud solution phone system carries the day. The perks of investing in a cloud-based phone system outweigh most of the disadvantages. Most importantly, the solution allows you to save time and money. This is probably why we see more customers go this route. 

To learn more about choosing the right phone system for your business or any of the products and services we offer, contact us today. We’re here to give you peace of mind to help you win more business.

Marissa Olson

A true southerner from Atlanta, Georgia, Marissa has always had a strong passion for writing and storytelling. She moved out west in 2018 where she became an expert on all things business technology-related as the Content Producer at AIS. Coupled with her knowledge of SEO best practices, she's been integral in catapulting AIS to the digital forefront of the industry. In her free time, she enjoys sipping wine and hanging out with her rescue-dog, WIllow. Basically, she loves wine and dogs, but not whiny dogs.