Distinctions Between Hosted and On-Premise Solutions Not Clear Cut

Hosted unified communications is perfect for many organizations, especially those in the mid-size range. Prospective users should understand that the landscape is a bit more complex than simply outsourcing or going it alone, however. There are different forms of hosting and the fast evolution of the underlying technology means that change is constant.

By Carl Weinschenk | Posted Sep 10, 2010
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At its most basic, the case for hosted unified communications is the same as for hosting of any telecommunications platform. It is less expensive, requires less expertise while taking advantage of the service provider's deep knowledge and, if configured correctly, is more secure since patches and other periodic procedures generally are performed on a more timely basis.

The list of disadvantages also is the same for hosted UC as for other telecom disciplines: It involves loss of at least some direct control over the most vital possession, the organization's data. The company's needs can get lost in the shuffle as the service provider seeks to keep multiple clients happy. This can be particularly problematic when there is a universal emergency, such as a blackout.

Processor does a good job of describing the intricacies of hosted UC, which is particularly attractive for small and medium-size companies. Writer John Brandon makes the point that there are different types of UC: 

For some, hosted UC means hosting your PBX infrastructure in the cloud and then selecting whatever extra features are available, such as instant messaging. In other cases, it can mean one end-to-end solution for every business communication possible.

He next provides his take on the advantages of hosted UC, which include better communications with customers and faster scalability and reduction of three key things: cost, new technology risk and energy consumption.

Costs are key, of course. Brandon writes that they vary based on company size and which services are provided. Brandon demonstrates  – through a quote from Scott Gode, the vice president of product management and marketing for Azaleos, just how complex this algebra is: Per-user fees include software, service and hardware, generally with extra for collaboration, IM, conferencing and voice services. A number of hidden costs, such as vendor management, archiving and others, can lead to sticker shock. 

It may be that the shades of gray between delivery conduits are merging over time. This is one of the key paragraphs from a long feature on hosted versus premise-based UC at Phone+:

There may be more consensus among vendors and providers than there appears, though. Several CPE manufacturers, such as Polycom, offer solutions for the end-user and for providers, taking a “both is best” approach to the market. Meanwhile, many hosted providers tout network- or cloud-delivered UC as the way to go because it's not proprietary and large customer segments apparently are willing to sacrifice control for a turnkey solution in a down economy, but are also ramping up managed services, which allows the customer to outsource management chores while maintaining control of their own CPE.

Definitions will change over time as the reliability, precise feature sets, pricing and other details evolve. At the end of the day, however, organizations will have to decide whether to deploy hosted UC – as, for instance, Camino Nuevo Charter Academy in Los Angeles said it would this week – or to start from scratch with premise-based approaches.

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