Hosted Phone Systems

By Ryan Ayers
Updated: March 02, 2011

Hosted telephone systems are commonplace in today’s business world. These systems allow a business to enjoy all of the advantages of a complex industrial telephone system without having the responsibility of maintaining it. These systems came into heavy use with the advent and adoption of VoIP technology, and many larger businesses already have them in place.

The Basics of Hosted Phone Systems

Traditionally, business telephone systems were designed to route calls from a main switchboard to many different extensions within a company using a complex set of physical equipment and lines. This equipment was maintained on site and was the responsibility and property of the company.

A modern hosted business telephone service is designed to perform the same functions as its traditional counterpart, but with increased efficiency and much less in the way of physical equipment.

A hosted telephone system operates using Voice over Internet Protocol (VoIP), routing calls through the internet over a business’ data connection. Because calls are made and received in this manner, the need for large PBX boxes and other on-site equipment is eradicated. VoIP equipment is often limited to server equipment and handsets, leaving the business users without the burden of system maintenance. The system itself still requires some maintenance and oversight, but this is now accomplished by a hosted VoIP service provider.

How Hosting Works

VoIP services, like so many other professional and software services, can now be administered and maintained via the Internet. With minimal physical equipment on-site, users are able to access their networks and make calls in much the same manner that they would with a traditional telephone system.

The service providers are able to set up and maintain a network to your company’s specifications and administer this network for you remotely. This affords companies the opportunities of a larger, more complex telephone system, without their having to purchase the network equipment.

Hosting services can vary as to the specifics of the service, but generally speaking provide lower-cost options regarding calling plans and services, features, and equipment than their traditional or on-premise counterparts.

Features and Add-ons

Many hosted service providers also provide an array of add-ons and productivity features to their customers. These features can boost productivity and optimize working conditions to allow for a much more user friendly customer experience.

Some commonly offered features of a hosted VoIP service are:

  • Integrated messaging
  • Visual voicemail
  • Auto attendant
  • Call queuing
  • Remote access
  • Call forwarding
  • Contact center/CRM integration


A hosted VoIP telephone system is a solution that allows businesses to employ the versatility of a large-scale telephone system without the costs associated with maintaining the necessary equipment on-premise.

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