Motion Networks

Key decision factors for Hosted PBX?

When you are in the decision making process whether to go for subscribing a hosted PBX service or buying an in-house telephony system (On-premise PBX System), you may hear that the responses from your suppliers are varied, complicated and sometimes very biased. This article is aiming at give you an overall view about what you need to consider and observe. Since we are providing both types of service and solution to customers, we hope you will find the following sharing useful and relevant to your business. In fact, most of the sharing below are based on our dialog with end customers who raised to us before.

1. Cash flow and Tax Benefits

There is a huge difference between the two options when you look into the payment method affecting your cash flow. When you look into the cash outflow, say 5 years Total Cost of Ownership (TCO), for On-premise PBX System, your initial investment constitutes 60%-70% of the TCO, while the rest 30%-40% of payment (mainly maintenance service) will be evenly split for 4 years upon expiry of 12 months warranty. For hosted PBX payment method, it is clearly a monthly flat rate across 60 months. Cash flow is a very powerful and attractive word to company owner or CFO as it may help the company to get more Tax Benefits. Most of the business decisions voting for Hosted PBX is driven by top management financial strategy.

2. Internal IT resources

Now a day, SMB (employee size less than 30) in Hong Kong may have a stronger incentive to go for Hosted PBX due to limited IT resources available within the company, if your company size is more than 30 employees locally, you should have at least one IT staff to support all IT related matters. Since the On-premises PBX (mainly IP based) is one of your Network component which IT staff should be able to manage it internally in order to have an overall control of your network security. You are easily locate a professional service company to provide software and hardware support of your On-premise PBX while your IT staff can provide Tier one support to internal colleagues.

3. Operational needs related to PBX features

One of the major difference of these two options is the controllability of your PBX system. As most of the Hosted PBX platform is running on a shared basis i.e. One platform serving different customers and offering a standard set of phone features to all customers. Therefore, you could hardly obtain a customized solution through Hosted PBX platform. This is the fundamental question you need to ask your service provider. Please think about your current and future operational needs say call flow for a small hotline, Call center, CRM, mobile phone integrated with your PBX etc. The more you understand your current and future operational needs, the better you understand how you would like to deploy the solution.

When you are planning to do office relocation in 6-12 months, I trust the above will give you a high level thoughts to think about your company direction.

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