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Cloud Based Business Phone System

What is a Cloud Based Business Phone System?

Since VoIP (Voice over Internet Protocol) phone systems have improved with advanced technology, businesses have been able to substantially improve their communications by “going digital.” Since business technology is improving at a rapid pace, utilizing cloud-based technology with a VoIP system is becoming an increasingly popular option so that businesses can streamline their communication tasks and save money while doing it. If you’re still using an “old-school” hardware for your business phone, it’s time to give cloud-based VoIP systems a look.

A Cloud-Based Phone System is a business phone system that uses a new-and-improved version of an On-Premise Private Branch Exchange (PBX) system, so employees can communicate both internally and externally. PBX systems were designed so that businesses can enjoy the utility of having one integrated phone number, with connections to individual extensions for each employee. But a cloud-based PBX takes it a step further compared to a Hosted PBX phone system – it uses the internet to route calls to appropriate lines without any physical server hardware whatsoever (hence its name – cloud-based). This means you can essentially take a business call anywhere in the world, as long as you have a device that connects to the internet. 

What’s the Difference Between Cloud-Based and Hosted VoIP Systems?

It can be a bit tricky to understand the difference between Cloud and Hosted PBX systems, especially since they’re both forms of VoIP. In terms of hardware, the main difference is that hosted systems require a physical server – scaled to fit the business – to operate. This can be located either at the business location directly (also referred to as “Hosting” a PBX system) or off-site (“Hosted”) at the provider’s location. Once the server is set up, employees can enjoy the benefits of Internet-routed calls and equipment-free work environments (the server can be connected to from wherever, generally). At the same time, because the server is hosted and scaled to fit the particular business, the telecom features, storage, and usage patterns are consistent and uniform across the company.

Alternatively, the cloud system only requires an Internet server – no physical server. That means the server does not need to be scaled to a specific size prior to getting started, so users have more control over the scale and features, and they can be customized as the business grows and changes. However, the cloud system also does not pre-determine usage and storage patterns prior to getting started, which can be a downside for some businesses.

All in all, for businesses that operate mostly in-office and have a predictable telecommunication pattern, a hosted system is the way to go. For start up businesses, remote or freelance businesses, or businesses that aren’t sure where their telecommunications habits are heading, a cloud system would be a good fit.

What are the Pros and Cons of Cloud-Based Systems?

While cloud-based phone systems seem extremely convenient right off the bat, it’s important to weigh the pros and cons before deciding if it’s the right option for your business phone system.


  • No hardware necessary: Because all their telecom data exists in the cloud, these systems require little to no hardware to purchase or operate. You can connect your business phone number to your smartphone, laptop, desktop, or even desktop phone. Along with this benefit is that there is no start-up fee (most other phone systems require this). All you do is pay your monthly subscription fee and connect your line to the device of your choice.
  • On-the-go flexibility: Professionals who are constantly on-the-go, working from home, or traveling particularly benefit from this advantage, since they can streamline their messages in one place no matter where they are. Some in-office employees also enjoy this benefit, so they can utilize their personal device and receive personal/business messages in one place, or stay in the loop when they’re away from the desk.
  • Cost-effective: Most cloud-based systems are extremely cost-efficient – they  work via a simple monthly subscription fee – usually between $20 – $45 per month, which includes typical VoIP features and tech support, which is appealing to many businesses to avoid “hidden fees.” 
  • Uncomplicated technology: It’s appealing for some businesses to avoid overly complicated technology, but they still want to reap the benefits of new tech features! With a cloud-based phone line, there’s no hassle or learning curve to use, and you don’t have to hire an IT team to take care of tech issues moving forward.


  • Depends on Internet Signal: One potential downside to cloud-based VoIP is that in order to use the phone line, you need to have good Internet signal. You’ll want to consider where you usually use your phone and whether there’s good WiFi signal. This is a non-issue for many employees who work around high-grade business Internet consistently, but remember that if you’re on-the-go, you’ll need to find a WiFi zone!
  • Beware of Usage Charges: With a cloud-based line, you want to pay close attention to your subscription plan and what it allows in terms of usage. Some allow unlimited domestic calls, and some have a set number of minutes (which are most commonly the cheapest options in terms of subscriptions, but you’ll pay more if you go over your limit). Before signing up for this type of phone line, think about what types of calls you usually make and how often, and ask clearly about the supplier’s usage plans before buying. 
  • Lack of immediate tech assistance: Although some may see the uncomplicated technology as an advantage, others may see it as a disadvantage. Having an internal IT team that can assist you directly when you need them can be helpful. With a cloud-based number, you’ll have to rely on over-the-phone tech support from your supplier or troubleshoot on your own.

Which Features Can be Added with a Cloud-Based System?

On top of its on-the-go flexibility and affordability, cloud-based systems offer many essential features for business communication, such as…

  • Voicemail – which you can access on any device your number is connected to.
  • Advanced business email – you have the ability to connect your work email to your phone line and access messages in one place, and most systems will even transcribe voicemails and send them to your email!
  • “Find Me, Follow Me” – this feature will connect all devices your number is connected to, so if you make or receive a call on any of your devices, other connected devices will also be able to take those calls, depending on the call options you enable.
  • Unified communications – many cloud-based systems have mobile apps, where you can streamline all your messages in one place. All you have to do is open your app and access work essentials like your CRM, Live Chat/SMS messaging, analytics, email, etc.
  • SMS Messaging/Team Collaboration – Many VoIP applications now have built-in SMS messaging, which most businesses now utilize on a daily basis. Having access to it in the same place as your other communication necessities is an added plus!

Which Types of Businesses Would Benefit the Most from a Cloud-Based Phone System?

The flexible advantages of a cloud-based phone system may be very enticing, but you want to make sure it’s the best fit for your business! You want to consider the way you and your work environment normally prefers to communicate and where you most often take calls. 


Here are the types of businesses that are most likely to benefit from a cloud-based phone system:

  • Small businesses planning on growing, hiring more employees, or moving locations in the known future. Since cloud-based systems are extremely easy to upgrade and scale (think: no hardware!) if you’re working in a start-up or a business that’s growing quickly, you might consider this phone system to maximize your revenue. 
  • Busy, on-the-go businesses that travel, hire remote workers, or work away from the desk. Your employees who are moving around constantly, multi-tasking, or working out of the office will enjoy the flexibility and customization-friendliness of a cloud system, as well as the simplicity of using a mobile app and staying connected.
  • Tech-savvy, fast-paced businesses that enjoy the benefits of digital features. Since you can add features to your cloud-based system for little extra charge, tech-savvy companies will enjoy all the added digital features that these systems allow!

Ready to look at your options? We work with the top VoIP suppliers that can talk to you more about your options and give you free quotes so you can find the best business phone system for your business. Get started here – we’re excited to help you improve your business communications!

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