How to Choose the Right Phone System for Your SME - Fleximize

How to Choose a Phone System for Your SME

Dan Baker of Criterion Systems explores the best telephone systems available to UK SMEs

By Dan Baker

If you're unsure about how to approach installing a new phone system, the first thing you need to consider is whether a traditional on-premises phone system or a modern cloud-based system would suit you better. There is a lot that can go into this decision, such as what you will need your phone system to do, your business' existing infrastructure, and how you feel about the cloud itself. Here's a quick look at the main features of each system to help you along:

On-premises systems

This is the traditional business phone system. For years, this was the only option available to UK businesses. It relies on physical copper phone lines, either PTSN or ISDN, to connect all of your phone extensions to the phone network. Another name for this type of on-site phone system is PBX or private branch exchange.

Usually, purchasing this type of system requires a single, upfront payment that includes the installation of all of the necessary hardware, including phone lines and a PBX box.

Cloud-based systems

A cloud-based phone system, or a hosted phone system, makes use of the internet and your existing WiFi connection to connect all of your phone extensions to one another and to the public phone network. This means that there isn’t any required infrastructure on site, such as phone lines, making the system incredibly easy to set up.

This also means there are no up-front costs, apart from the handsets - you simply pay a monthly amount for each user. As such, cloud-based systems are becoming increasingly popular due to their flexibility, lack of infrastructure and ease of setting up.

Voice over IP

There is also a third option, which is a combination of the two. It is possible to link a VoIP (Voice over IP) service to an existing on-premises infrastructure. The benefits of this hybrid system are that you still have the low call costs that come from the VoIP internet access, whilst having the reliability of the traditional phone lines. This is a viable option if you already have an ISDN or PSTN system in place but are looking to upgrade without removing the existing hardware.

The usability and features of these systems

Here's a quick look at some of the fundamental differences between on-premises and cloud-based systems:

Call quality

When cloud-based phone systems (such as VoIP) were first introduced, there were concerns over the quality of calls made over the internet. However, a cloud-based phone system provides the same level of clarity as a regular landline. In fact, depending on your location and the strength of your internet signal, it may be better with high-definition clarity.


This is one area where cloud-based phone systems have a clear advantage. A cloud-based system can be upgraded automatically and remotely, often without you noticing. An on-premises system would require a visiting engineer who would need to access the equipment.

Cloud-based systems, such as SIP trunking lines, can also be easily scaled to match your company's growth, or if you have a seasonal busy period. This can all be facilitated without any physical lines needing to be installed or removed.


The costs for both systems can depend on your requirements and usages. On-site phone systems have higher setup costs, as well as ongoing infrastructure maintenance costs.

Cloud-based phone systems, on the other hand, have a very small start-up cost as the only equipment you will have to buy are the handsets themselves. There is however a monthly rental cost based on the number of extensions. This means if you have a lot of users over a lengthy period, it may end up being more expensive than an on-site system.

Future-proofing your business

There is some bad news for on-site phone systems such as PSTM and ISDN phone lines. BT has announced that they are planning on switching off their ISDN networks in 2025, and stop taking orders for ISDN systems in 2020.

Of course, that still gives you six years of use for your on-site systems. It does, however, mean that if you are looking for a phone system that you can stay with for a long period of time, you might want to choose the more advanced and modern cloud-based system.

Which phone system is best for your SME?

Unfortunately, there is no easy answer to this question and it largely depends on the needs of your business. Each system has its own pros and cons. You will need to take into account your business requirements, your expectations and the strength of your internet connection.

If you are a smaller business, have seasonal demand, or your team is often on the move, then a cloud-based system such as VoIP is the perfect option for you. The flexibility that comes from the scalability and ease of setting up this system means you can easily move your system if you grow or move offices. VoIP also allows you to easily connect calls to mobiles or extensions at different locations.

If, however, you are hesitant about using a cloud-based system or you would prefer the security and reliability that comes with an on-premises physical phone system, then an ISDN system might still be the best option for you. This is also the best solution if your internet connection is unable to handle a cloud-based solution.

If you are still unsure about which business telephone system is right for you and your business, then contact your provider for an in-depth discussion of your options to make sure that you get the best phone system for your business.

About the Author

Dan Baker is a content writer working with Criterion Systems. Criterion is a business communications company, specialising in providing a wide range of business communication solutions to small and medium-sized businesses across the UK.