Cloud PBX vs. Hosted PBX: What's The Real Difference?

There are some things in life that are the same--or at least nearly the same--yet are wholly removed by name. After all, at their roots, a po'boy is not all that different from a grinder, or from a sub. Essentially, these are all names for "a big sandwich," though there are some differences between the three. That's about what the issue of cloud PBX (News - Alert) versus hosted PBX is like: a whole lot of similarities with just a very few differences.

At their roots, cloud PBX and hosted PBX services are much the same thing. Both services are made available to outside users in remote locations, with the hardware in a centralized location and the service made available to users via the Internet. This would make many users think that the two concepts are identical, but the two do differ, and mainly, it's the cloud service that makes a lot of the difference.

Cloud service does differ from hosted PBX on a few minor, but still noteworthy, points. With cloud service, there is a greater level of customization capabilities. In hosted PBX, service is usually somewhat more tiered in nature; there is a level of scalability available, but only in specific channels. Cloud PBX allows for a higher level of scalability thanks to the greater interconnectivity and higher level of collaboration allowed. Additionally, there are differences in the kind of reliability involved. Cloud PBX systems have more variables involved in their operations than do hosted PBX systems, so a cloud PBX system has a better chance of failing in the midst of usage spikes.

Perhaps highest on the list of concerns for many businesses is one of cost. Since neither cloud PBX nor hosted PBX have hardware, the costs overall are comparatively low. However, since cloud PBX commonly has lower capacity and somewhat lower reliability, costs are, likewise, a bit lower on average since cloud PBX requires a pay-as-you-go basis. Hosted PBX typically offers, again, a tiered system with pricing to match.

The question of which to go with, meanwhile, can commonly be settled by an overall analysis of the business and its needs, and what packages are available from which vendors. For businesses that don't need a lot of phone time, yet still want their bases covered, a cloud system should do the job nicely. For businesses that have a regular amount of phone traffic, and know pretty reliability how many calls they'll get in a certain time frame, a hosted PBX is likely to do a better job. Again, this changes based on the individual circumstances involved, but it's a good place to at least start looking.

The basic idea of cloud PBX and hosted PBX are extremely similar. So much so, in fact, that it wouldn't be difficult to mistake one for the other. But there are still differences to consider, and with these differences comes the possibility for not only an incredibly close fit in terms of needs and service provided, but also the possibility for mistakes to be made. Keeping an eye out for the differences is likely to help a business make some very big moves indeed.


Edited by Rachel Ramsey