VoIP Resources VoIP Fundamentals Introduction to Business VoIP

Cloud Phone System Pros and Cons

by Kevin Bartley

We weigh the pros and cons of using a cloud based phone system so that you can make an informed decision for your business.

Cloud based phone systems are phone services that your business can purchase on the Internet. Rather than maintaining phone system software on a server (a.k.a. a private branch exchange, or PBX) in your office, you can purchase cloud phone system service from a provider (a.k.a. hosted PBX) and pay on a subscription basis.

What exactly are the benefits of a cloud based phone system for small businesses? And what are the drawbacks? Here's a look at the biggest pros and cons of these services.

Cloud Based Phone System Pros

Cost Savings

Small businesses that switch to VoIP reduce the cost of their local calls by up to 40%. Those same small businesses reduce the cost of their international calls by up to 90%.

A sizable number of cloud VoIP providers charge less per minute than leading landline phone services. No matter what your call volume and usage, it’s almost guaranteed that a cloud based phone system will cost you less each month than a landline service.

Unlimited minutes packages are economical for call centers with high traffic, while Pay-As-You-Go pricing models can accommodate those businesses that use minutes sparingly. And hosted platforms don't require you to purchase expensive hardware that needs maintenance and installation, saving you quite a bit, as judging from the example above.

Geographic Flexibility

You don’t have to be next to your desk phone to make calls on a cloud based phone system. Cloud phone systems allow you to work anywhere with a working Internet connection. You can set up an IP phone, plug in your laptop, or use a softphone on your smartphone to make phone calls from your cloud phone system. This means you can work from home, on the go, or as a full-time remote employee.

Some cloud based phone services offer free phone apps that allow you to work from wherever you like. You can extension dial your team, call the public switched telephone network (PSTN), and use phone presence that tells you when your coworkers are occupied with calls, all without stepping foot in the office.

Geographic flexibility is also a great tool for connecting your offices under one phone system. If you have offices in multiple locations, a cloud based phone system can connect your entire company to the same phone service and have it managed by a single administrator from any location.


Because the components of a cloud based phone system are not all housed in the same location, most providers have a low amount of service downtime and very few disruptions. “Geographic redundancy” is the industry buzzword used for this decentralized setup. The word “redundant” is used to signify that all the different servers are a mirror replica of the others.

For example, if a service provider hosts servers in New York and San Diego, either of those servers can act as backups should an extraordinary event knock one of the servers out of commission. If the server in San Diego experiences a major power malfunction, the traffic will be routed through the server in New York.

Cloud systems usually have very small amounts of downtime due to geographic redundancy. If you're in the market for a cloud phone system, ask the provider what the downtime of their service is to get a sense of how much these disruptions affect service. If they have good redundancy, the figure should be close to zero.

Hosted PBX

Many cloud based VoIP providers are hosted services that house all the phone system hardware offsite. Generally, all you need with cloud hosting services is an acceptable Internet connection and working IP phones.

This means you won't have to pay for maintenance of the equipment, mechanical malfunctions, or additional IT hours to keep your system up and running. All of these issues are dealt with offsite by your service provider.

Most VoIP cloud companies, like OnSIP, have a dedicated customer support team that can take your questions over the phone or via email. The smaller day-to-day issues you experience can be answered by knowledgeable professionals, most of whom are located in the US.

VoIP Phone System Cons

Phone and Router Purchases

Switching to a cloud based phone system may require you to purchase equipment to get up and running. With a hosted cloud system, you will need to purchase IP phones if you don't already have them. These phones are typically priced in economy ranges and require an Ethernet port to operate, meaning you may need a larger router and more Ethernet cords.

Outside Disruptions

If your Internet Service Provider (ISP) is fairly reliable and your cloud phone system has high redundancy, you won't have to worry about dropped calls and connections. But if you have an ISP that frequently drops your Internet service, it will critically disrupt your cloud based phone system. Of course, if you find an acceptable ISP, the problem will be solved. The issue only becomes serious for those who are locked into subpar Internet providers through contracts.

The Cloud VoIP Era

Cloud phone systems are becoming increasingly popular for businesses of all stripes. Hosted VoIP solutions for small and medium-sized businesses, along with enterprise-grade options, give customers a new kind of flexibility and reliability when it comes to phone systems. If you think you might benefit from these platforms, it's never too late to make the switch. We highly recommend that you take the time to check out cloud business phone system reviews to find your best fit.

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