VoIP Guides | hosted phone systems

What is a hosted phone system and what are the benefits?

Hosted phone systems let you communicate over the internet, instead of traditional phone lines. These systems are often called VoIP. Business phones are an absolute necessity for companies to stay in touch. With a hosted phone system, you don’t have to deal with the hardware of landlines or worry about maintenance. But what is a hosted system and how can it help your business?

These systems can often help to speed up your communications and make taking calls that much easier. Here’s everything you need to know about hosted phone systems.

Man using hosted phone system in the office for customer service

What is a hosted phone system?

A hosted phone system is a cloud-based telecoms solution. It’s sometimes called hosted telephony. The provider hosts the system, so you have no unnecessary hardware in your office.

The system is set up to work over an internet connection instead of traditional phone lines. Traditional phone systems are known as ‘On-site PBX systems’.

With a hosted phone system, any device that connects to the internet can make and take calls for your business. That includes your desktop PCs, laptops, and mobile phones.

How does a hosted phone system work?

When we think of office phones, it’s normal to imagine a landline. But that system is in the past. Business phones these days are a lot more flexible and technologically driven.

The systems work by connecting to the cloud. These are servers outside of your office. To get a cloud system, you’ll have to sign up and pay a fee (usually monthly) to get access. When you make the switch to a hosted phone system, your provider will help you with the set-up.

Since the phone system is connected to the cloud, you don’t have any extra hardware or maintenance or updates to do. That is handled by the provider off-site.

What about an internet connection?

If you don’t already have a good internet connection, the benefits of a hosted phone system will soon tempt you to upgrade. A hosted system needs a good connection to work well, so your calls are smooth for the customer and easy for you to make. If you don’t already have a strong connection, business broadband deals can help you get to speed to support your hosted phone system.

How fast of a speed you need depends on how many calls you’ll be making at once. A small business with one or two phones will not need a super-fast connection for a hosted system, compared to a large office. As you make the switch to a hosted system, your provider can help you find the right connection speed to keep your business at its best.

What are the different telephony systems available?

Not every system is the same and you can tailor your system to best fit what your business needs. There are two main types of hosted systems: full hosted and hybrid systems.

Full hosted phone systems: uses the internet to connect your phones and calls. No landlines are needed.

Hybrid systems: a combination of traditional PBX phones and a hosted system. This type can use ISDN lines and the cloud to make calls.

Hybrid hosted phone systems are useful as a transitioning tool for businesses who want to gradually move to a completely cloud-based telephony system. They can also be used as a backup if your internet connection goes down.

But as ISDN phone lines get shut off in 2025, we recommend businesses chose a fully hosted phone system instead or make sure there is a solid transition plan for the best futureproofing.

Man connecting smartphone to the cloud

What are the benefits of a hosted phone system?

Using the cloud for your phone system lines up many benefits. Why choose a hosted phone system? We’ve broken down the reasons why below. Keep reading to find out how the benefits can help your business.

1. An easy switch over

Switching over to a hosted system doesn’t have to be costly. Hosted systems tend to be less costly because they don’t use hardware, only software over the cloud. You can use all the devices you already have, like your mobile phones and company laptops to help keep the costs down and make the change quickly and smoothly.

2. Spend less time on maintenance

PBX uses phone lines. Traditional systems tend to be more expensive because of this. They require more work to look after and more maintenance to run smoothly. The good news is that hosted phone systems don’t require the same level of upkeep.

Your system provider will make all required software updates over the cloud. You don’t have to wait for your provider to visit the office or have to call someone in to make repairs.

3. Help your team work remotely

Remote and hybrid roles are becoming more popular. Does your team have to be in the office to make and take calls? What if they could join meetings from anywhere, anytime? As long as they have the internet, you can stay in touch.

4. Add new users easily

Hosted phone systems are easier to scale up. With a traditional phone system, you’ll need to buy new phones and set them up for new employees and let your provider know. With a hosted system, you just need to press a few buttons and the new user is added. It’s a big time saver.

5. Reduce your call costs

Using a hosted phone system is one of the best ways to help reduce your call costs. Landline and mobile providers make you pay per minute to take calls. You aren’t hit with higher costs for making longer calls, unlike traditional phones when you use a hosted system.

Hosted phones work differently. You have to pay a fee to use the cloud server and your chosen hosted system. This cost is often significantly lower than your traditional phone system. What the usage fee will be depends on what features you choose for your package.

6. The complete package

A hosted phone system can do more than take calls. If you want the most features in one package, then your business will benefit from VoIP. You can think of VoIP as the most popular type of hosted system. Using VoIP, your team can do everything they did over conventional phones and more. You can easily forward calls remotely, appear as a local number to customers, answer calls at the click of a button, and much more.

This means that hosted phone systems are highly customisable. You can pick and choose which features you want for your business, giving you more flexibility and control. And you can always go back to your provider to add more features later when you want them.

How can you get a hosted phone system?

If you’re ready to make the call to switch to a hosted system, the first step is finding out which system and provider will work best for your business. There are systems with different features to support every business need, whether you need complete flexibility, remote working support, or want to start with just the basics.

With a few details about what you need, we can help you find what suits you best. Use our free quote tool and get in touch with your hosted phone system provider.

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