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hosted vs on premise call center solutions with telarus master agent I spent over 20 years working in the call center industry. During that time, I helped build and expand dozens call center operations around the globe.

When you are building a new call center, you have one goal: Create the capability for your employees to take and receive calls. When a customer is talking to a call center, there are normally 500 – 2000 staff supporting the center .

Early in my career, when we built a new call center, we usually had to buy a new switch and all the supporting bells and whistles. Essentially, we became our own telephone company. We set up all the routing, and owned the switch and the servers. Fifteen years ago, this was essentially the only option available to us. It made call center support very expensive, for it required dedicated and experienced staff.

This entire undertaking is referred to as on-prem housing and maintenance. Effectively, your company owns and maintains all the equipment. As a result, the CAPEX required to build out a new call center with all equipment is significant. It is not uncommon to spend millions.

Hosted Call Center Solutions Allow SMB to Seem Bigger

Today, thanks to the wide variety of hosted services, even SMBs can take advantage of the full menu of UC services. You don’t need your own switch.  You don’t need to record your own hold music. Heck, you don’t even need a physical phone! All you need is to decide which options you want and sign a contract. Smaller businesses can now, quickly and easily, play with the big boys.

The debate over which option, hosted call center solutions or on-prem, is best rages on. To determine the answer, one must evaluate variables such as cost, control, and functionality.

Here are several common variables and my thoughts:

  Hosted On-Prem
Capital expenditure (CAPEX costs) Low entry costs (CAPEX). The only significant cost is the physical phone. If you want to run it, you’re going to pay for the equipment (hardware) and the expenses associated with maintenance (staff, data center, rack space, etc). The greater the hardware requirements, the higher the cost.
Installation Low installation cost. You are also likely to require specific support to install.

Because cloud systems are designed to “lather, rinse, and repeat,” implementations are usually faster than on-prem.

High installation cost and additional time and effort. The hardware must be specified, ordered, and installed. Dedicated staff requires payment. Continuity planning needs to be incorporated.
Adding Features You can add new CC features as they become available on your cloud platform. Just like when you add an app to your phone. Most of the time, this is as simple as placing an order or downloading the app and performing the initial setup. Cloud platforms are already very comprehensive and have the majority of desired features. Cloud contact center companies  must stay current or lose customers. For additions, IT teams need to redesign and redeploy based upon the nature of the additions or subtractions.

Like most upgrades, this is performed during off hours or slower times.

Speed to Implement With any CC deployment, you need time.

As a general rule, less than 50 seats may take two to six weeks. Yes, it can be done faster, but the question becomes should it be done faster.

The fastest options normally are the least customizable. Most cloud companies are not going to build features unless they can sell them across their customer base.


If you are going on-prem, you are likely adding hardware at the same time you are taking hardware away. The existing infrastructure must be redesigned. This requires a ample amount of coordination, very specific project planning, and expected troubleshooting.

From my experience in contact centers, on-prem solutions take six months to a year minimum to deploy. If projects are phased, they may take years.

Infrastructure You access your platform infrastructure via the cloud. You often pay as you go for the services you choose. Infrastructure varies considerably by vendor. Vendors have proprietary software designed to work with specific hardware. If your upgrade is more than software, something will be installed.
Provisioning Requirements Landline connectivity takes place through the cloud and is bundled into most per-user fees. When you use on-prem, you need analog land lines. This Is a separate expense and contract.
Licensing, Maintenance, and Support Providers typically charge a per-user licensing/support fee. This varies because you are likely using equipment from different companies. You will want to know these costs and stay current to ensure you have access to the latest upgrades.

Note:  Upgrades/enhancements require redesign, support, and roll-out time.

Training/User Experience Many cloud solutions are designed for ease of installation. They have experience implementing again and again. The processes are usually efficient.

The user experience is also likely refined. Because the process has been repeated, training and support are normally straightforward.

The con here is that hosted solutions can be sterile. While they can be customized, there are always gaps in expectation.

If you own, install, and maintain the equipment, you also own the training and user experience.

Think about this for a minute: Although our friends in the premise world have material, they either charge you to do the training (certifications anyone?) or leave that burden to you.

You bear the responsibility to train your full employee spectrum, from entry-level to executives. Each audience requires customized training.

Without a training and instructional design team, this is painful and costly.

What’s Best for You? Perfect for small and medium-sized organizations with limited IT staff.

There is no reason a corporation shouldn’t consider a cloud solution, but most require significant customization. Further, most large corporations prefer to keep their hands on the controls. Some organizations are less willing to rely on a supplier for these services. Yet this is becoming less and less common as cloud providers are moving up into the enterprise size opportunities.

Bottom line: Unless you are a large corporation, this is a very expensive option that requires very specific support.

Very specific support


Very specific costs

Disaster Recovery (DR) Most cloud suppliers build disaster recovery into their offering. You, on the other hand, are only as good as your internet services. If your internet service is inconsistent, cloud services will be compromised.

In the event you do have an issue with your hosted supplier, you are essentially at their mercy. You need to do your homework.

Chances are you chose on-prem to keep control. As such, redundancy is likely already factored in.

This is expensive, but most companies get around this by putting their eggs in multiple baskets. You can lose an egg or two and still meet service goals.


This is not a small decision, and there are likely specific needs and reasons you would choose one over another. Do your homework. Ask questions. Compare pricing.

At Telarus, we can help you. Let us share in your leg work.

We are delighted to assist, make introductions, and provide expertise.