10 hidden costs of an on-premises phone system (PBX)

Many on-premise phone system (PBX) manufacturers claim that the five-year costs of their systems are lower than an equivalent cloud alternative.

What they don’t tell you about are the extra hidden costs that come with the hardware and software limitations in their systems.

This guide will give you some useful questions to ask any PBX manufacturer to work out if you’re getting the full picture on the cost of their system.

The real cost of PBX

2Sprint Business 10 hidden costs of an on-premises phone system (PBX) 22

01 Flexibility

Traditional PBX systems can’t handle peaks and troughs in demand.

Instead, you have to buy capacity for the peak demand. This may only occur for a couple of weeks a year but it’s so important to your business that you have to pay extra.

What to ask:

• Have you sized this system for my peak demand?

With a hosted system you can just pay for the peaks as and when they occur, rather than all year round.

3Sprint Business 10 hidden costs of an on-premises phone system (PBX)

02 Redundancy

Look at how the PBX system handles calls if you lose the equipment room due to flood, fire or electrical failure. After all, adding site redundancy will add at least an extra system to your costs.

What to ask:

• Have you factored in the cost of site redundancy?

Because hosted is in the cloud, your business communications service is always available on multiple devices.

03 Running out of capacity

For features like call recording, on-premises systems rely on servers that have a finite disk capacity. When you run out of space, you can’t record any more calls.

Not great if you have a requirement to record calls.

What to ask:

• How many hours of call recording have you quoted me?

• What is the maximum I can buy?

• How much will it cost me?

With hosted, the recording capacity is delivered via cloud storage so you don’t need to worry about capacity.

4Sprint Business 10 hidden costs of an on-premises phone system (PBX)

04 The cost of obsolescence

The average lifespan of an on-premise system is about seven years, mainly due to the hardware going obsolete.

You might also find features your business relies on are no longer being upgraded, leaving you with a system that cannot meet your future needs.

What to ask:

• How old is this product?

• When will the manufacturer stop developing features for it?

• Or have they stopped already?

The cloud is an evergreen platform that continually updates and adds new features.

5Sprint Business 10 hidden costs of an on-premises phone system (PBX)

05 Mobility

Mobile integration with an on-premise system is often cumbersome and ends up with additional call charges on the PBX trunks with calls being hair pinned in and out of the system.

What to ask:

• How is mobility supported on this system?

• Do calls route in and out of the PBX for call treatment?

• If they do, how much extra will that cost me in trunk calls?

A cloud-based system is modern enough to be mobile friendly from the ground up.

06 Fraud costs

PBX systems can be a target for fraud, especially smaller systems. Attacks can leave huge bills that the business will have to pay.

What to ask:

• How many times has this type of system been hacked?

• Does the manufacturer release any data on such occurrences?

• What happens if I get hacked — do I have to pay all the costs?

With a cloud system, your phone system is protected in a secure telco network. It’s a bit like keeping your money under the mattress or putting it in the bank.

6Sprint Business 10 hidden costs of an on-premises phone system (PBX)

07 Maintenance cost of the hardware

With PBX systems you also need to factor in the maintenance costs of on-premises hardware. If the system’s not well maintained, there’s a risk it’ll fail. That leaves you without your phone lines (and with big bills to pay).

What to ask:

• What are the annual maintenance costs of the hardware and software in this system?

• Will they rise as the system gets older?

With cloud-based PBX all system hardware is located in secure data centers so you have no servers to worry about and no direct maintenance costs.

7Sprint Business 10 hidden costs of an on-premises phone system (PBX)

08 Integration costs

Need to integrate with a CRM system? This is the most common requirement of a PBX and normally costs you extra to get a system integrator who can make it all work together.

What to ask:

• Which third-party systems have you integrated this PBX with?

• How much will it cost?

With cloud-based systems the integration is already done and can be switched on at a moment’s notice.

09 Performance

You might not think about it when you’re buying a new system, but the more features you switch on in an on-premise system the more likely it is that you’ll need to upgrade the processor board, potentially adding a huge expense.

What to ask:

• What happens if the system slows down due to switching on extra features?

• Do I have to pay for another upgrade?

• If so, how much will it cost me?

With a cloud-based system your performance never changes, with virtually limitless amounts of processor capacity available to draw on.

8Sprint Business 10 hidden costs of an on-premises phone system (PBX)

10 Management

System management is often overlooked, but can be costly, especially if integrated with other applications or IT services. Outsourced management to a third party will incur charges for a minimum number of service calls per year regardless of use.

What to ask:

• How many hours per week would it take to manage my system?

• How much will it cost to hire an engineer to support this?

With cloud-based systems all your management is performed easily via web interfaces. All remote sites can be managed from a central location without a large number of field personnel.

9Sprint Business 10 hidden costs of an on-premises phone system (PBX)

On-premise systems used to be the default for business-phone systems. The cloud gives you another option.

A hosted system gets you better service, fewer operational headaches and a lot more security.

Most important, it saves you from the litany of hidden costs that traditional systems brought with them.

It’s better technology — and it’s a better way to manage technology.

Plus the cloud lets you access a host of new ways for working, such as Sprint® Smart UC. This new suite of tools offers an easier way for businesses to get their people working together online securely and efficiently.

Get more with the cloud

10Sprint Business 10 hidden costs of an on-premises phone system (PBX)

Let’s talkYou shouldn’t have to struggle to make the most of the cloud. You can (and should) be making it easier for everyone to collaborate with anyone, anywhere — using the same secure system across any device. Sprint® Smart UC exists to help you do it well — and avoid hidden costs.

Find out what Sprint® Smart UC can do for you. Contact your local Sprint representative today to learn more. Call 866-653-1056 or see more details on sprint.com/business