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July 26, 2015

Hosted vs on-premise – which UC is right for you?

There are a few choices to weigh up - and cost is a big factor.

By Alexander Sword

The way in which we all, as individuals, consume data and communicate in our personal lives drives a new expectation of availability to communicate in different ways, and businesses must maximise on the benefit of that to provide the same ‘always connected’ experience in our working environment.

There is still some division over whether to deploy unified communications on-premise or in the cloud. On-premise solutions, which host the server and hardware appliance on the enterprise’s own site, remain the market leader. In hosted solutions, by contrast, the vendor physically houses the hardware.

In general, the cloud solution, Unified Communications as a Service (UCaaS) holds more of the advantages. However, there are some specific situations where on-premise might be more suitable.

The key benefit to the cloud is, as usual, the low CAPEX, or sunk cost. You can scale up or down at will depending on the size of your operation and the only equipment cost will be the phones themselves.

Deployment in the cloud will also reduce the company’s staffing costs; to deploy a unified communications solution within an enterprise requires considerable expertise.

Additionally, with an on-premise deployment, there will not only be the costs of the equipment and installation but also the costs of future updates when this equipment becomes obsolete.

So in what circumstances should enterprises consider an on-premise solution? Rufus Grig, CTO of Azzurri Communications, explains that on-premise could be the best option for companies that can use this as a differentiator:

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"When deciding whether to manage their own systems on-premise, or subscribe to a cloud or hosted managed service, the question organisations need to ask themselves is ‘Is there a business benefit from us owning and managing this system ourselves?’

"If there is clear case for competitive differentiation, availability, security or cost, then on-premise can be the way to go."

However, Grig adds that "with the range of UC as a Service (UCaaS) offerings available today, (he) can hardly conceive of any situation where an on-premise model is the right answer."

For some businesses, particularly those in the financial sector, security may be a key factor. Arguably, the security of most reputable cloud providers is beyond what an enterprise itself could achieve, as UC provider Digium argues in a whitepaper:

"If you choose a reputable hosted provider they will have the resources to keep your data secure. Smaller businesses may find that a hosted provider does a better job of keeping data secure. This is because of the dedicated pool of resources the provider invests in keeping all of their clients’ data safe."

However, even if the cloud is secure, compliance may need to be factored in. For example, in 2011, in the UK, the FSA extended compliance regulations to cover the recording of phone calls. It is important to know whether your industry requires you to store data on-site.

All in all, for the average business, a hosted solution appears to be the best bet. However, as Jody Kennedy, CTO of Olive Communications explains, the next big dilemma is in the choice of provider.

"The key to successful deployment of UCaaS is the choice or your UCaaS provider," argues Kennedy.

Kennedy adds: "A partner who will work with you to understand your business communications needs and has the ability to deliver a converged solution that importantly brings together the best UC solutions (from multiple vendors) that fit your requirements."

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