Is it Worth Investing in a Hosted Phone System?

Hosted Phone Systems

Hosted telephony is a phone system housed in the cloud instead of installing it in the office. Several businesses, including small businesses, large enterprises, customer support departments, and call centers, use a hosted phone system to manage their communication process. Some of the key reasons why cloud-based phone system is so popular include:

  • There are no upfront equipment purchase costs involved
  • It facilitates flexible communications management
  • It provides ultimate control from Internet-enabled devices

Since hosted telephony uses cloud technology, it eliminates the requirement of installing costly physical hardware. It also prevents the need for ISDN or analogue telephone lines from phone providers. A hosted telephony system is hosted remotely and linked to through the Internet. The remote location is termed a Hosted PBX (Private Branch Exchange). This location can be accessed via leased lines. Leased lines are the lines that are fully dedicated to a particular business with no other external traffic. This is how a hosted telephony system provides a flexible, consistent, and efficient way to manage communications. 

In the case of a traditional phone system, the system is based on the premises and connected directly to an ISDN line from a service provider. To handle all the incoming calls, each member usually requires a desk phone. However, with a hosted telephony system, the call can be received easily on various devices with a hosted telephony system, including a desk phone, softphone, or mobile application.

How does hosted telephony work?

Users can effectively handle calls via a hosted phone system with a cloud PBX. Here’s how a hosted telephony works: 

  • First and foremost, a business finds a hosted phone service provider that provides a cloud PBX. A business is then connected to its offsite data centers. 
  • Businesses can receive all the incoming calls that go to their hosted PBX system.
  • The hosted PBX system translates that call data into digital packets. These digital packets are then transmitted via an internet connection. 
  • The PBX system routes the incoming call to a business’s office desk phone.
  • As soon as the desk phone rings and the user picks up the call, the digital packets are converted back into voice messages. Thereby a connection is created. 
  • Once operational, a business can efficiently manage all its international communications across multiple sites through a simple interface.

With a cloud phone system, any device (desktop, laptop, mobile phone, or landline system) can be used to make and receive phone calls. The only prerequisite is a high-quality internet connection. 

Advantages of a hosted phone system

Some of the key advantages of employing a cloud-based phone system as compared to a traditional phone system for businesses include:

  • Simple installation: When talking about a traditional phone system, the installation can be a lengthy and complex process. Moreover, the installation can be quite expensive as well. However, in the case of a cloud-based phone system, the complete installation and setup process takes place online. This makes it quite an uncomplicated, easy, and cost-effective solution. Small businesses or businesses with a largely remote working team can benefit greatly from this system. 
  • Provides unified communications platform: A cloud-based phone system provides a unified communication platform to the users. The platform lets users communicate both internally and externally using a single tool. Several teams, including sales and customer support teams within an organization, can collaborate efficiently and form effective strategies around their hosted VoIP solution. Nowadays, many service providers offer numerous features along with the ability to place calls. It means that the users can host video conferences, send instant messages to team members, or call customers, all via the same hosted VoIP phone system. 
  • Cost savings: As compared to a traditional phone system, hosted phone systems are very much cost-effective. The reasons are:
    • To use a cloud-based phone system, the users are not required to purchase a new set of equipment. They can utilize their existing equipment like desk phones, softphones, mobile devices, or VoIP handsets. 
    • Also, in terms of maintenance, a cloud-based phone system provides greater savings. Users are not required to call a technician to come to the workplace and fix the issue.  The IT staff can easily handle and fix the most common VoIP issues, eliminating the need to contact the service provider. 
    • Since numerous tasks can be performed using a single tool, businesses can save a lot with a cloud-based phone system. They don’t have to spend money on a tool that can perform just one task. 
  • Offers flexibility: Businesses with a remote team can provide enough flexibility to their employees (working from home or on an overseas business trip) to receive calls easily with a hosted phone system. This eliminates the need to be present in the office to pick up the calls. Most hosted phone system providers provide software for their users. The remote team can use this software to manage effective communication with their team, management, as well as customers. The users just require downloading the business phone software onto their devices. This will allow the PBX provider to connect and divert all the incoming or outgoing calls to the user’s device. 
  • Provide complete scalability: Today’s businesses look for a phone system that can grow with the growth of a business. In the case of a traditional phone system, adding a new team member can be quite frustrating and expensive as well. On the other hand, with a cloud-based phone system, users can enjoy complete scalability. To add a new team member, users can simply sign into their provider’s cloud platform and add as many members as they want. 
  • Highly secure solution: Whether it’s a small business or a large enterprise, security is the main concern of every business. One of the most common types of data breaches is ‘social engineering.’ In this type of data breach, hackers imitate a phone provider and ask businesses to hand over information. Once the required information is received, the hackers can easily use that data to take over a business system. However, a cloud-based phone system comes with an additional layer of security against social engineering and other data breach practices. The majority of VoIP providers utilize robust identity management tools that make it very difficult for hackers to take over a business phone system. 


Overall, it may be said that a hosted phone system is the need of the hour for today’s businesses. It makes the entire communication effective and seamless and allows businesses to save huge on various expenses. Investing in a cloud-based phone system is certainly the best decision a business can make to stay ahead in today’s highly competitive marketplace.

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