What's best - Hosted or On-Premise Unified Communications
16 March 2017

Hosted vs On-Premise Unified Communications: Which is right for your business?


According to Gartner, Inc, the worldwide public cloud services market is projected to grow 17.2 percent in 2016 to total $208.6 billion, up from $178 billion in 2015. Recent research also showed that the vast majority of technology and business decision-makers identify upgrading or replacing their legacy systems to cloud technology as a key part of their IT strategy, with many of them already implementing or using cloud application. Indeed, moving your UC applications into the cloud may even make your organization look progressive and forward thinking. However, before you take the plunge into the world of hosted cloud UC, let’s consider some key factors to help you make the choice between a hosted versus an on-premise solution.



If you have difficulty managing the technical and maintenance aspects of UC, and do not have in-house IT expertise, cloud based offerings should look very appealing. If you need global presence and 24 x 7 x 365 support, the case for a hosted UC service becomes even more compelling. With in-house expertise, on-premise solutions tend to offer more room for customisations. For example, if you have specific requirements for parent-child configuration, or complex call centre setup, then a hosted solution might not be able to meet your needs. The assumption in such cases is that the required expertise is available in-house.

Service providers, like StarHub for example, have a greater depth of expertise available compared to other more vertical focused service providers. They can help you to fully understand your requirements and identify which model best addresses your companies needs and capabilities.



If your business is growing rapidly, a hosted solution is typically more flexible and allows you to add users on an on-demand basis very quickly. Expanding the capacity of your on-premise platform usually requires a longer lead time. It may even require a ‘fork lift upgrade’ if you reach the capacity limit of the existing platform.

If you require business expansion across multiple locations, a cloud-based solution is often simpler to set up and is less likely to require additional equipment or costly MPLS bandwidth to accommodate remote users.



When it comes to disaster recovery and contingency planning, an on-premise system may require an extra set of equipment. If geographical redundancy is required for a higher level of protection, a backup site needs to be operated. This is where a hosted solution really shines. If a company’s primary site becomes unavailable, switching to a new location can be implemented very quickly and a minimal cost. Building out geographic redundancy for an on-premises PBX system can be very costly in both direct telephony equipment and the redundant networking services required to support it.

Trust and Security


When you run UC on-premise, you only have to worry about yourself as it is hosted within your own physical location. Increasing security or modifying processes for better protection is easier as it is within the control of your own organisation. When you outsource it to cloud service providers, you need to extend a lot of trust. However, a reputable hosted provider would ensure that your data is secure. Do think carefully whether your business is involved in projects that have security compliance requirements that dictate that your data has to be kept in-house.The cloud services provider would need to be carefully briefed so that they will be able to understand your business as well as you. While most service providers have their own standard operating procedures, most of these will be adjusted to meet your needs.

Whether you can trust the cloud service provider as much as you could your own internal, self-hosted on-premise installation depends on how secure you assess the provider’s security policies to be.

Hybrid Solutions


A hybrid solution incorporates the best of both cloud and on-premises offerings. For example, you can connect the users in headquarters to an on-premise system while other users in smaller remote locations can be connected via a cloud-based system. Do check however that your vendor allows their cloud-based and premises-based equipment to fully interoperate with one another. Note that the features and user experience experienced by those at remote sites may not fully match that available at the headquarters location.

The bottom line – Work out the numbers


A hosted UC solution can often lower your business costs due to the savings in (expensive) IT personnel, ISDN or SIP Trunking as well as costly equipment, and its maintenance. You can convert your upfront CAPEX into monthly OPEX payments, as hosted UC solutions are typically charged as a monthly per user fee. However, above a certain threshold, it becomes more cost effective to buy your own equipment and hire your own IT personnel than to pay a monthly fee. Do your sums, analyse your ROI and then add in the other intangible factors (trust, security etc.) in the final equation.

Choose Wisely


It is a wise person who treads into the hosted versus on-premises debate without any preconception that one is better than the other. Both models offer unique advantages, and you will need to figure out what works best for your organization.

Call a RFP and get more information from established UC service providers. StarHub offers both Hosted and On-Premise solutions. Do tap the expertise of our presales team to help you to navigate your options. Who knows, your journey into the brave new world of digital disruptions may end up somewhere in the clouds.


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