Cloud vs on-premise phone system: let the building decide

The difference, in one paragraph

With a cloud system (also called hosted), the brains of the phone system live in a data centre. Your desk phones and apps connect to it over your internet link. With an on-premise system, the brains are a box in your building. Internal calls, paging and analog devices stay inside; calls to the outside go out over a SIP trunk or a phone line. Both can run the same features, the same Yealink handsets and the same mobile app. The difference is what happens when the link to the outside world drops.

Four questions that decide it

1. What has to work when the internet is down?

Make the actual list. Not “the phones”: the specific things.

• In an office: probably nothing that can’t wait for the connection to return, or move to mobiles for an hour.
• In a hotel: the front desk, wake-up calls, the elevator phones, the pool phone, the fire panel’s line.
• In an apartment building: the elevator phones, the door phone, the fire panel and alarm lines.
• In a school: the office, the classroom phones, the paging.
• In a care home: every resident room phone.

With a cloud system, when the link is down the phones can’t reach the system, so nothing on that list works through it. An on-premise system keeps internal calls, paging and its analog ports working, and can hold a backup path to the outside.

2. What is analog?

Elevator phones, fire panel diallers, alarm communicators, fax machines, door phones, pool phones, hotel room phones. Count them. An on-premise system carries them on its own analog ports. A cloud system needs a gateway at the site for each one, and that gateway depends on the internet link anyway.

Elevator phones deserve their own care. Ontario’s elevator regulator has warned that an elevator phone that met the code’s requirements on a copper line may not meet them on a VoIP service, because the phone may only be able to confirm it has reached the modem (TSSA Advisory 290-20). That’s true whether the system is in the cloud or in the closet; it is one more reason to keep those lines close and tested. See the elevator emergency phone.

3. How good is the connection, honestly?

A downtown office with fibre and a second path can run anything. A site an hour from the nearest technician, with one wired link that drops in weather, is a different case. Rural Alberta connectivity has improved, and we still wouldn’t hang a life-safety line on it alone.

Power matters too. Copper lines used to carry their own power. Their replacements don’t. TELUS, for example, offers residential customers a battery backup on its fibre home phone and still calls phone service during a power outage “best effort” (TELUS, fibre upgrade notice). Whichever system you choose, decide what keeps the phones, the switch and the router alive for the first hours of an outage.

4. Who looks after it?

• A business with no IT, good internet and nothing analog usually wants the monthly shape of hosted: no hardware, nothing to wear out.
• A hotel, a school, an apartment building or a remote operation usually wants one system in the building, one number to call and someone who watches it. That’s on-premise under a service agreement, with remote management so most service happens without a visit.

The honest summary

Building	Usual answer	Why
Office, good connection, no analog	Cloud	Operating cost, no hardware
Office, poor or single connection	Either, with a backup path	Depends on what can wait
Hotel	On-premise	Room phones, front desk, safety lines
Apartment or condo building	On-premise, or lines kept separate	Elevator, door and alarm lines
Independent school	On-premise	Classroom phones, paging, summer install
Farm, colony or remote site	On-premise	Distance and connection
Care home	On-premise	The room phone is a lifeline

Yeastar, whose systems we install, is pushing toward its cloud. We sell both, and we’ve kept appliance expertise on purpose, because many of our customers’ buildings still need it. We’ll tell you in the same conversation when a cloud system is the better fit for your office.

What doesn’t change with the choice

911. Either way, the address registered against your outgoing numbers is what the emergency call centre sees. The CRTC requires local VoIP providers to provide 911 service and to tell customers about any limitations in it (CRTC, 9-1-1 obligations of local VoIP service providers). Read that notice. For multi-line systems specifically, see 911 from a business phone system.

Testing. A system nobody tests is a system nobody knows works. Both of our service agreements include an annual emergency-calling and life-safety test, with a certificate.

Frequently asked questions

Is cloud cheaper?

Up front, yes: no hardware. Over the life of a hotel or school system an on-premise system is often the lower total. We show both shapes on a quote.

Can we have both?

Yes. A head office on hosted and a property on an appliance can be linked so extensions dial each other.

If we choose on-premise now, are we stuck?

No. Yeastar publishes migration paths between its editions, and the configuration carries over.

How do we decide if we’re not sure?

A Telephony Health Check documents what you have, what’s analog and what depends on the connection. It’s a fixed fee, $1,500 for a single site, plus GST, and the report answers this question.