With the up rise of both telecom startups and existing corporations tauting hosted PBX plans to  millions of “would-be consumers”, it’s no wonder individuals and businesses alike are getting more and more confused by the second about which to utilize: a physical PBX or it’s hosted counter-part. Sure, cloud technology sounds fascinating, the prices seem reasonable, and the features seem practical. But what happens when you do an in-depth analytical comparison? You may be shocked to realize the techno-savvy cloud is really a money drawing vortex aimed straight at your accounts payable with its features leaving you nothing short of underwhelmed.

First let’s look at the bottom line, literally. You’ll find most companies offering hosted PBX solutions warmly greet you with a “low cost” monthly package. Using PBXPlans.com as our measuring stick (their prices are pretty standard), you may be pleasantly surprised to discover a “full blown” PBX system will only cost you $24.99 a month. What you may not realize is the low cost monthly package that first drew your attention will inevitability include a limited amount of minutes with overages costing 6.5 cents a minute or more. With the average ten person office using a minimum of 4000 minutes a month, you’re initial offer just morphed into a $264.50 monthly commitment.

In the words of your favorite infomercial, “But wait, there’s more…” Standard PBX features such as dial by name directory, conferencing, follow me, and ring groups aren’t complimentary. A fully functioning hosted PBX that caters to the bare minimum of your office’s needs will cost you approximately $345.49 a month, that is of course if you only need live call recording on two of the ten extensions. Have a call center of specialists waiting to effect customer satisfaction in all your clients? Tack on an extra $10 per extension per month.

Considering you can find a hosted PBX provider that will waive the initial set up fee, you’re looking at a yearly expense of approximately $4,160.88 which equates to $20,729.40 every five years.

Let’s move on to the hosted PBX’s older brother, the physical unit itself. While most people cringe at the thought of shelling out a lump sum of hard earned money for a phone system, customers who proceed with a PBX purchase gain more features, more capabilities, and ultimately more cash in their pockets.

With robust systems starting at approximately $1600, purchasing a PBX will start saving you money after only 5 months and will have kept $19,000 in your business at the five year mark. Saved money you can use for other more profitable ventures including brand awareness, market expansion, and customer retention.

By utilizing a non-hosted PBX, you’ll have full access to its many features including call forwarding, personalized music on hold, paging, languages support, voicemail to email and hunt groups – a feature not even offered with most hosted “solutions”.

ave a unique business matrix? Purchasing the actual PBX gives you an immediate advantage: the ability to customize your PBX to meet your exact needs. While such customization may cost you a little extra, you’ll find the end result to be much more pleasing then the hosted PBX provider’s customer service rep kindly telling you such a configuration won’t be possible with their limited feature set.

With money as the first major point of concern for most users toying with the idea of incorporating a PBX into their daily business lives, fear of “not having the right technical knowledge” comes in as a close second; which is why most hosted PBX providers brag about their “hassle free” set-up and “no knowledge required” platforms. What most end users don’t realize however, is the physical unit comes with the same guarantee: no heavy technical knowledge required. As long as you know enough not to use your CD/DVD ROM  tray as a cup holder, you’ve got your bases covered. The actual unit comes with an installation wizard that literally takes 5 minutes or less to install. Unless those 5 minutes of your time are worth $19,000, purchasing the actual unit is your best bet.

Speaking of bets, ever try calling in to a hosted PBX provider’s customer support or maintenance department? The odds are definitely stacked against you with long hold times, questionable support suggestions, and shoddy resolutions. By purchasing an actual telecom product, you’re also purchasing the knowledge and support of actual telecommunication professionals should the need arise.

Along the same topic of rising, when your company grows to the point of needing more than your monthly hosted PBX package affords you, get ready for a hefty penalty disguised as upgrade fees which could tack on several hundreds to your monthly plan bringing your five year investment to approximately $32,700.

In the end while a hosted PBX may seem like a simple, low cost, efficient alternative to the upfront cost of the actual unit, you’ll find yourself shelling out more money for less features, less support, and less overall satisfaction.

Although you may feel like you’re biting the bullet by paying the full initial cost for a PBX, financial advisors and telecom experts would applaud you. Whether you are a small company or a large mega corporation, more features, better support, and a more robust system will leave your business fully prepared to  function at peak performance, grow, thrive, and ultimately succeed…even for those who did take advantage of their computer’s awesome cup holder.