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Hosted UC vs. On-Premise UC: Which Model is Right for You?

March 26, 2012

As organizations consider shifting to the cloud, on-premise versus hosted solutions both offers several advantages. Ultimately, many companies are moving toward a utility-subscription model because of the flexibility, scalability and cost advantages that come with cloud-based services. But companies have to choose the best deployment model to suit their business needs.


Of the many choices of applications available in the cloud, unified communications is one of several stepping stones organizations are deploying, according to Bennie Langenhove, managing executive for Tellumat (News - Alert) Communication Solutions.

Over 95 percent of UC is delivered on-premise; however, by 2016, half of all organizations will source their UC on a utility subscription model, according to Gartner (News - Alert).

“Hosted UC is a good fit for many organizations, especially small or midsize businesses and companies that are geographically distributed,” according to Langenhove, who enumerated some of the benefits found in a hosted UC model. Here are a few:

  • Shift to OPEX (News - Alert) from CAPEX. Organizations can shift their IT investments from a capital expense to an operational expense. Many educational, healthcare, government and other organizations can cover their communications costs through federal government subsidies.
  • Rapid startup. With a cloud-based UC system, providers handle installation. You do not need to buy and install UC systems, software, and storage.
  • Reduced IT administrative overhead. With UC provided as a service, customers can focus their resources on the core of their business, not on running their phone systems. This allows them to free up people and capital for innovation and serving customers.

Although hosted UC is becoming more readily adopted, many businesses still operate using enterprise-owned systems, which means an on-premise deployment is often considered more practical.The benefits of on-premise UC, according to Langenhove, include:

  • Control and familiarity. Most major corporations have a history of buying and managing their own phone systems. They want the control, their own infrastructure and a well-trained staff.       
  • Preference for CAPEX. Many organizations prefer to make capital investments for IT infrastructure, and depreciate it over time.  
  • Business continuity or regulatory requirements. All businesses depend on the flow of incoming calls to make sales and service customers.
  • Customization. Communication-enabled businesses can optimize workflow. Integrating UC processes can increase efficiencies, but often requires custom integration between an insurance application or a retail application, and a UC system.



Edited by Rich Steeves

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