---
title: "Cloud or on-premises phone system | DataRoad IT"
description: "Cloud, on-premises or hybrid IP PBX: five-year cost, remote work, internet failures and QoS, calculated with your figures. Request a no-commitment proposal."
language: en
url: https://www.dataroad-it.com/en/cloud-vs-on-premises-phone-system-cost/
source: https://www.dataroad-it.com/en/cloud-vs-on-premises-phone-system-cost/
publisher: DataRoad IT (DataRoad - IT Services and Consulting), Portugal
---

> Cloud, on-premises or hybrid IP PBX: five-year cost, remote work, internet failures and QoS, calculated with your figures. Request a no-commitment proposal.

# Cloud or on-premises phone system: which costs less over 5 years?

At a glance For decision-makers short on time.

- 01 Under 3 years or dispersed teams: the cloud almost always wins.
- 02 Over 3 to 4 years, everyone in one building: on-premises tends to be cheaper.
- 03 Hybrid: on-premises PBX with remote extensions and queues in the cloud, ideal if you already invested.
- 04 Without QoS and managed switches, neither option sounds good.

**A poorly chosen phone system is paid for twice: on the monthly bill and in the calls that drop. DataRoad, headquartered in Alfragide with support across the whole country, compares cloud and on-premises PBX using each company's real figures and takes responsibility for both the voice service and the network it runs on.**

The decision comes down to one question: for how many years will you use the system? With a short horizon, or dispersed teams, the cloud almost always wins. With a long horizon and everyone in the same building, an on-premises PBX usually ends up cheaper, and the tipping point typically comes between year 3 and year 4. There is also a third option that few people propose.

## What decides between cloud and on-premises?

- **The tipping year** Around year 3 or 4, the on-premises model starts to pay off.
- **The middle ground** Keep the PBX in the building and move only remote extensions and queues to the cloud.
- **The network** Voice over IP needs traffic prioritisation; without it, neither model works well.

## What does each model cost and how does it behave, criterion by criterion?

| Criterion | In the cloud | In the building |
| --- | --- | --- |
| Start-up | Low investment: handsets and installation only | High investment: hardware and licences |
| Every month | You pay per extension | You pay maintenance and call traffic |
| When it pays off | From the first month | Around year 3 or 4 |
| New versions | Arrive automatically, at no extra cost | Scheduled and paid for by you |
| More or fewer extensions | Adjusts month by month | Tied to the licences you bought |
| Several offices | One PBX serves them all | Needs links between sites |
| Working from home | The extension works wherever there is internet | Requires a VPN or secure publishing |
| Internet down | The PBX stays up and forwards to mobiles | Internal calls continue; external calls stop |
| Power cut in the building | No impact on the PBX | It stops, unless there is an adequate UPS |
| Recordings and data | Held by the provider, under a data processing agreement | Stay with you |
| Integration with local systems | Feasible, depending on the provider | Full, even with legacy equipment |

## When is the cloud the right decision?

- **Up to around 50 extensions** With no special integrations.
- **Dispersed teams** More than one office or people working from home.
- **Zero hardware** Predictable cost per user and a free rack.
- **A move on the horizon** If you are changing premises soon, the PBX moves with you, with no works.
- **Seasonal teams** Extensions that open and close during the year.

## When is an on-premises PBX cheaper?

- **Many extensions, many years** Over five years, the savings add up.
- **Recordings kept in-house** Isolation or internal retention requirements.
- **Local systems** Production lines, reception, intercoms, legacy equipment.
- **Hotels and healthcare** Direct integration with management software installed on site.
- **Unreliable internet** With no acceptable alternative connection.

Chosen by respected and international companies

★★★★★ 5,0 · 52 Google reviews

★★★★★ 5,0 · 52 Google reviews

## Why does almost nobody propose the hybrid model?

Because it suits neither type of vendor. In the hybrid model, the PBX stays in the building and only remote extensions and call queues move to the cloud. For companies that bought a PBX recently, it is often the most rational option financially.

## What risk must you check before choosing?

The network. Choosing the model before auditing it is the most expensive mistake in this decision. VoIP degrades on networks without QoS, with unmanaged switches or with a shared internet connection without rules. In the cloud, the symptoms are dropouts and silences; in the building, the same.

That is why we run the same check as in any [network infrastructure project](https://www.dataroad-it.com/en/structured-cabling-installation/). Discover the [IP PBX managed by DataRoad](https://www.dataroad-it.com/en/managed-ip-pbx-portugal/): installation, number porting and support, in both models.

## Questions from decision-makers

### Is a cloud PBX more vulnerable?

Not in itself. Properly configured, a cloud PBX and an on-premises PBX encrypt calls in the same way. What changes is who is responsible for the infrastructure and what the data processing agreement says. A forgotten on-premises PBX left open to the internet is far more dangerous than a managed, up-to-date cloud service.

### If I choose now, am I locked into that model?

No. IP handsets usually work in both models and your phone numbers move with you from one to the other. The real loss lies in on-premises licences paid for ten years ahead, which is why we advise against over-investing at the start while the usage horizon is still unclear.

### Does our old analogue or digital PBX go in the bin?

Not straight away. The old PBX connects to a gateway and extensions migrate in phases, rather than all in a single weekend. That way the company keeps answering calls during the transition, and the most-used desks move to the new system first.

### How many simultaneous lines should I contract?

Between 25% and 33% of the total number of extensions, as a starting point. Sales and customer service teams need more channels; administrative departments, fewer. The right number is confirmed against the call log of your current system, and that is the calculation we make before proposing.

### What happens to calls if the internet fails?

It depends on the model. In the cloud, the PBX stays active and forwards calls to mobiles. In the building, internal calls continue but external calls stop until the connection returns. In both cases, a second internet connection with failover reduces the risk, which is why we manage network and voice together.

### Does DataRoad only install the phone system?

No. The PBX is provided within an IT Unlimited contract, for companies with more than 10 workstations, and DataRoad is responsible for the voice service and the network that supports it. We do not carry out one-off jobs or sell standalone equipment: that way there is a single party accountable when a call fails.

## Want to see the comparison with your own figures?

We calculate both scenarios over five years, with your extensions and your traffic, with no commitment. Read also [the real price of a business phone system](https://www.dataroad-it.com/en/ip-phone-system-price-cloud-on-premises/). We provide this service within an IT Unlimited contract: no one-off jobs and no standalone equipment sales.

**More than 10 workstations · support contract · remote, on-site and phone support.** +351 211 459 950 * · sales@dataroad.pt

**Call to a Portuguese landline.*

News

## Projects delivered and news from DataRoad.

[See all news →](https://www.dataroad-it.com/en/news/)

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Numbers you can verify

**11** years in business

**232** clients

**< 10 min** average response time

**15+** IT vendor certifications

**10+** Countries with clients supported

**5.0 ★** 52 Google reviews

Transparency

## What many providers hide, we publish.

[See plans and prices →](https://www.dataroad-it.com/it-unlimited/)

- **Prices upfront** Essential from €395/month + VAT, Premium from €750 and Premium 365 from €1,200.
- **No lock-in** Annual contract, no lock-in and no joining fees.
- **Everything in writing** What is included, the scope and the price, before you sign.
- **Support without counted hours** Remote and phone in every plan; on-site support from Premium.

Partners and certifications

DataRoad · Cloud and Microsoft 365

## One StepAhead of IT.

The right licences, MFA on every account and backups that actually restore. The cloud stops being an invoice and becomes a tool.

- **MFA** on every managed account
- **0** DataRoad security incidents in 11 years
- **M365** backed up off-site

We do **IT** right.

Contact

## Have your backups ever been put to the test?

Automated, monitored backups stored off site.

Phone +351 211 459 950 * *Call to a Portuguese landline

Sales email sales@dataroad.pt

Headquarters Avenida dos Moinhos 12 B, 2610-119 Alfragide, Portugal

More than 10 workstations · support contract · remote, on-site and phone support

DataRoad works only for companies under an IT Unlimited contract. We do not take subcontracted work or one-off call-outs.

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