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What is a Hosted Phone System?

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  • Written By: B. Turner
  • Edited By: W. Everett
  • Last Modified Date: 08 November 2016
  • Copyright Protected:
    2003-2016
    Conjecture Corporation
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A hosted phone system is a type of communication system designed for businesses. Hosted phone systems allow businesses to manage phone calls more easily and to quickly transfer calls to a variety of sources. The business requires less equipment on site, and pays a monthly or annual fee to a hosting company to manage phone systems and related equipment.

When clients call a business with a hosted phone system, they generally reach a recorded answering service, which is based at the hosting company. This service allows the caller to direct his call to the appropriate party by pressing a specific number or extension. The hosted system automatically transfers the call to the correct person based on the extension they dialed.

These systems can transfer calls to almost any types of device depending on the needs of the company. The call may ring through to a desk phone in an office, or to a mobile phone or pager anywhere in the world. A hosted phone system can also be programmed to send calls to a fax machine or voicemail, or even to a computer-based software program.

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Many companies that do not use a hosted phone system rely on a key-system unit (KSU). KSU phone systems require a large amount of physical equipment on site, which must be maintained and operated by the company. The most basic hosted system is a KSU-less system, which simply means that all equipment is owned and stored by the hosting company, not the client. Larger businesses often require a more complex hosting system, known as a private branch exchange (PBX). A PBX system works just like a KSU-less system, but can be applied to a much larger group of workers.

A hosted phone system offers a number of benefits to companies who choose this system. They greatly reduce equipment costs, as all equipment is owned by the host. There is no need to provide space for this equipment, and also no installation or maintenance required. Hosted systems also offer a great deal of flexibility, and can route calls automatically wherever they are needed. Finally, these systems take the burden for communications management and services off of the client and place them in the hands of the hosting company.

Companies should be prepared to pay a monthly fee for hosting, which is often determined by the size and complexity of the system. In order for a hosted phone system to operate, it requires a fast internet connection with a large volume of bandwidth. Interruptions in the internet service will prevent calls from transferring to the desired party. The client will also need to purchase phones designed to work with these systems.

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