Should Your Business Switch to Cloud PBX?

Cloud PBX vs. other digital phone systems

Cloud phone systems are an offshoot of digital — or on-premises — private branch exchange (PBX) systems. These systems offer the same level of functionality but differ in where the equipment is located and how it is maintained. This makes cloud PBX systems manageable for new businesses, those on a tight budget and those without dedicated IT personnel.

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• On-premises/digital phone systems: On-premises phone systems have PBX equipment housed in large hardware units that must be stored on-site. On-premises systems can be very costly because they are large and require a special storage facility. Companies are also on the hook for expensive regular maintenance because the machines are complex and require professional attention. Digital PBX phone systems are monitored using a PBX switchboard. The switchboard processes the connections between telephones to facilitate calls and control many business-grade phone system features.
• Cloud PBX: Cloud PBX takes all the functionality of a digital system and moves it into a virtual space, eliminating the need for hardware and other equipment and saving you money on installation and maintenance. Hosted PBX systems have become popular primarily because they are easier to use and provide all of the functions of a digital PBX platform (and more) without requiring clunky, costly equipment.

What are the benefits of cloud PBX?

Cloud PBX phone systems bring numerous benefits, especially to startups and very small businesses. These include:

Low cost

The greatest benefit of a hosted cloud PBX system is its low cost. You can save in the following ways: 

• Limited equipment costs: Because a hosted PBX system is provided as a service, you don’t have to purchase physical equipment unless you want desktop phones with VoIP This can help reduce costs and expedite the time it takes to set up a phone system in the crucial early days of a new business.
• Low installation and maintenance costs: The lack of equipment also helps you save on installation and maintenance costs. All services and features are fully hosted in the cloud and maintained by your provider; the cost of your phone service covers regular updates and maintenance. Most providers offer online portals where you can manage your phone lines, updates and maintenance needs.
• Control over feature costs and fees: With a hosted PBX solution, you have significant control over how much you pay because you pay only for the features and phone lines you need. Additionally, most cloud-hosted business phone systems offer unlimited domestic calling, so employees can use the phone as long as they want, without worrying about racking up added fees. If you’re spending a lot of time trying to drum up new business or maintain customer satisfaction to ensure repeat business, this is a major benefit.

Flexibility

Cloud-based PBX systems offer these significant benefits regarding features and flexibility: 

• Flexible locations: As the world moves increasingly to nontraditional and flexible workplace environments, businesses must be reachable anywhere, anytime. A hosted solution allows you to conduct business calls via your smartphone or computer as long as you have an internet connection. If you’re considering moving your business to a new location, you won’t have to worry about lugging equipment (except phones).
• Customizable settings: Your employees can customize their phone settings to whatever works best for them. For example, they can have calls routed to both their desk phone and their computer or their desk phone and mobile phone.
• Business communication features: Cloud PBX also provides features such as texting, voicemail transcription, call recording and integration with vendor services. Features vary among systems, so you should determine the features your business needs and shop around for vendor offerings.
• Online management: Administrators can add users, assign phone numbers, create ring groups, and review call reports and monthly statements from an online portal. Employees can log in to the portal to check their voicemail, see the company directory and set up call-forwarding routes. This is especially useful for remote or hybrid teams and gives businesses the opportunity to save on office costs.
• Business phone numbers Employees can send text messages from their business lines instead of their personal phone numbers. This can help new or very small businesses appear larger and more professional.

Reliable service

Phone communication is the backbone of day-to-day activities for many businesses. For this reason, reliable service is a must. A traditional landline system uses copper cabling to transfer phone calls, and these cables are vulnerable to natural disasters, vandalism and general wear and tear, all of which could result in extended outages.

In contrast, cloud PBX systems use the internet, which means your phone service is as strong as your internet connection. Because all of your information is in the cloud, your system should experience little or no downtime if there’s an issue. Geographic redundancy — when the provider has several servers in different physical locations — is one of these systems’ most common reliability measures. Each server contains identical information, so if one fails, another can take its place almost instantly. You can expect a 99.999% uptime from the best cloud PBX systems.

What are the cons of a hosted PBX system?

Although hosted PBX systems are popular, they are not the best option for all businesses. Here are some possible drawbacks:

• Reliance on your internet connection: If you lack access to high-speed internet, have a poor internet connection or cannot properly secure your connection, cloud PBX may bring you more frustration than it’s worth. The system depends entirely on the internet and will not function correctly without a strong connection. If your internet service provider is unreliable or frequently drops your internet service, hosted PBX is not a good fit for you.
• Security concerns: Because hosted PBX systems are internet-based, they’re more susceptible to security breaches than digital systems are. When you speak to vendors, ask about their security measures and how they protect your data. You should ensure they have both physical and network security, SIP trunk endpoint security, toll fraud monitoring and detection, and a dedicated monitoring system that alerts you to any suspicious activity.

Should your business switch to cloud PBX?

In almost all cases, yes, your business should switch to cloud PBX. This is especially true if you manage a remote workforce and need a way to conduct business calls without giving away employees’ personal phone numbers. You’ll also look much more professional with business phone numbers that all start with the same area code. Plus, for customer service or sales teams, taking calls in quiet home environments instead of loud, conversation-heavy offices can be a welcome change.

There are only two cases in which you might want to avoid cloud PBX:

• Your business is in an area with poor connectivity. Cloud PBX may not be suitable for you if your business is located in a rural area with a history of spotty or low-quality internet connectivity. This limitation obviously interferes with the ability to easily use cloud PBX, though the Federal Communications Commission’s recent rural broadband expansion may help to combat this issue.
• Your business has a poor cybersecurity infrastructure. You might want to avoid PBX if your company has struggled to maintain a robust cybersecurity profile. Although cloud PBX platforms come with plenty of cybersecurity features, they can only go so far if your own cybersecurity infrastructure is lacking. 

Popular cloud PBX providers

The right cloud PBX system is essential for business communications. To choose the right business phone system, consider the following popular options and what they offer:

RingCentral

RingCentral offers three subscription tiers that range from $20 to $45 per user per month. Before you get started, RingCentral provides you with an implementation specialist who helps you choose new numbers, transfer current numbers and decide how many phones you’ll need. The company’s calling features include call forwarding, call recording, call screening, call logs, message alerts and answering rules. 

Other popular tools include auto-receptionists, multilevel interactive voice response systems, voicemail, voicemail to email, and visual voicemail. Conference calls can hold up to 1,000 participants. RingCentral also offers a mobile app for iOS and Android devices. Learn more via our RingCentral review.

Ooma Office

Ooma’s pricing depends on whether you choose an IP PBX, an analog phone option, or both. Regardless of the phone type, Ooma’s starting price is $19.95 per user per month. However, you must install some of Ooma’s on-premises equipment if you want to use analog phones. This PBX system also offers a virtual receptionist and virtual phone numbers for employees who work outside the office. Read our Ooma review for more details on what this cloud PBX vendor offers.

8×8

This cloud-hosted VoIP unified communication system uses custom pricing, so you must contact this provider for a quote. 8×8’s service has an uptime of 99.999 percent, which means it’s down for only a few minutes each year. 8×8 offers three-way calling, call forwarding, call waiting, call transferring, online voicemail, an automated attendant, ring groups and caller ID. It also integrates with popular programs such as Google Workspace, Microsoft 365 and Salesforce. Dive deeper into 8×8 via our 8×8 review.

GoTo Connect

To find out GoTo Connect’s pricing for your business, you must contact the GoTo sales team. This system provides advanced ring strategies, unlimited call queues, video conferencing, personal meeting rooms and screen sharing. The latter two features make GoTo Connect an especially powerful cloud PBX choice for remote teams. Our GoTo Connect review explains what makes this platform so remarkable. 

Taking your business phone system to cloud nine

Almost all businesses should make the switch to cloud PBX, and several high-quality platforms are available to power your transition. Utilize any free trials you encounter as you compare systems, and implement the platform you liked best. Train your team on your new software, and you’ll be off to a great start in improving your internal and inbound communications.

Max Freedman and Kiely Kuligowski contributed to this article.