What is a cloud business phone system?
A cloud (or hosted) phone system runs in the provider’s data centre. Your handsets or softphones connect over the internet or a dedicated link. There is no PABX hardware on your site to maintain. Features—voicemail, hunt groups, call recording, etc.—are delivered from the cloud. Many Australian providers offer cloud business phone services with local data centres and support.
What is on-premise?
An on-premise PABX is physical equipment installed at your premises. You (or your IT team or a partner) are responsible for maintenance, upgrades and resilience. On-premise can offer full control and, in some cases, lower long-term cost if you already have the skills and space. A number of Australian vendors still supply and support on-premise systems; the market has not disappeared in favour of cloud.
Typical trade-offs
Upfront cost
Cloud usually has lower or no upfront hardware cost; you pay per seat per month. On-premise typically requires a capital outlay for the PABX and handsets, though ongoing licence and support costs apply in both models.
Scaling and flexibility
Cloud systems generally make it easier to add or remove users and sites without touching hardware. On-premise may require capacity planning and hardware upgrades when you grow.
Reliance on internet
Cloud voice depends on your internet or data connection. If that link fails, voice can fail unless you have a backup (e.g. 4G failover). On-premise can keep working for local calls if the PABX and internal network are up, though outbound and inbound still depend on your trunk provider.
Control and compliance
Some organisations prefer on-premise for data residency or compliance reasons. Cloud providers often offer Australian data centres and contractual commitments; the choice depends on your policy and risk appetite.
Hybrid options
Hybrid arrangements—e.g. keeping an existing PABX and adding cloud extensions, or using cloud for new sites—are common. If you are not ready to go fully cloud or fully on-premise, a review can outline what hybrid options typically exist and how providers compare. See our business phone systems service page for more.
FAQ
Is cloud always cheaper?
Not necessarily. Over a long period, total cost of ownership depends on seat count, contract length, support and any existing hardware. Typical ranges vary; an independent review can compare typical pricing across providers.
Can we keep our existing numbers?
Number portability in Australia generally allows you to move numbers between providers when switching. Confirm with any shortlisted provider before committing.
Do you sell phone systems?
No. Telco Review compares options; we do not sell carrier or PABX services. We help you see what’s available so you can engage providers directly.