How does a cloud based phone system work?

Cloud phone systems use an internet connection to facilitate communication with employees, existing and potential customers using voice, chat and video. If you’re interested in more details about exactly how these systems work, then you’ve come to the right place. In this article, we examine how cloud phone systems work and the benefits for businesses looking to switch or take up a new cloud telephone system.

Published: 26/01/2022
Updated: 09/07/2024

What is a cloud-based phone system?

A cloud-based phone system relies on internet connectivity. The internet is critical, without a connection a cloud based phone system won’t be able to work. Every part of a cloud-based phone system operates using the internet, including voice calls, chat functions and video calling.

Having a reliable internet connection is important, a intermittent internet connection will cause issues and disruptions to the business phone system.

In cases where a reliable internet connection cannot be installed or established then an on-premise PBX system is recommended to ensure continuity of service. In the majority of locations, a cloud-based phone system is easier to set up, reliable and can save a business money compared to an on-premise PBX phone system.

Sections:

How cloud based telephones systems work
Impact on a business
Benefits
FAQ’s

No wires needed

Unlike traditional PBX phone systems, cloud-based phone systems don’t rely on phone wires to provide the ability to connect calls. This means that with a cloud based phone system businesses do not need to reroute wires, set up complex desk phone wire circuits, or place phones near telephone sockets.

Hosted on servers

Cloud based phone systems are located on secure servers which have internet access. The business phone service is then delivered to each device over the internet connection. The server has the ability and computing power to perform more complex functions compared to any desktop computer. The server also holds the data needed for the phone system, this can be accessed by multiple devices simultaneously. We use dedicated servers at Enreach to provide our customers with cloud-based phone systems. These servers provide an additional layer of security since they are only used for this purpose.

3 considerations for choosing a cloud based telephone system

Setup Cost

Ease of Use

ISDN Switch-off

How do cloud based telephone system work?

Cloud telephony relies on converting analogue voice signals into data, transmitted using a broadband connection. Once a number has been dialled, a service provider like Enreach will take that call and route it to the intended individual, team or business.

Step	Inbound Calls	Outbound Calls
1	Caller dials number.	User initiates an outbound call from desk phone or softphone.
2	Call is received by cloud phone system.	Device sends call request to cloud phone system.
3	Phone system processes call rules to identify intended recipient – individual, team or location.	Call is established with the recipient at the destination number.
4	Cloud phone system reviews feature or service set – call forwarding, call queueing, on-hold marketing, call recording.	Call is routed to PSTN or VoIP network.
5	Call routed to destination – desk phone, softphone or external number.	Call established.
6	System logs call.	System logs call.

Centralised Call Management for Inbound and Outbound Traffic

Businesses need flexibility in how calls are managed, cloud phone systems provide that with feature-rich capabilities.

Calls connected in milliseconds

A system that is flexible for every business need, ensuring call quality and efficient routing. Move into the digital age, the timing couldn’t be better with the ISDN switch-off.

Click thumbnail to view diagram of how cloud based phone systems work

Technology required to have cloud based phones

Whether you are considering a virtual landline or not, the requirements and setup is relatively simple. All you need is:

Internet connection
VoIP service provider
IP Phone
Router

Impact of cloud based phone systems

How a cloud based telephone system impacts an employee differs to that of the business. Below are the key details.

Impact on employees

Employees won’t notice an immediate difference in the way that a cloud based phone system works compared to a traditional on premise PBX system. Calls are higher quality and there are more functions available, but overall, the concept still remains the same.

Employees will benefit from the additional features and increased flexibility that a cloud based phone system offers. Some key benefits include:

Flexibility to work from any device with an internet connection
Facilitates working from home and mobile integration
High quality calls with no interference as long as the internet connection remains strong
Issues can be fixed remotely with no need to call out an engineer, reducing employee downtime
Employees have instant access to the latest updates and features to improve efficiency and performance
Employees can easily manage voicemail, set up call recording, change hold music or hold marketing messages, and much more
Provides voice, video and chat in one integrated system

Impact on business

Businesses can save money and time with a cloud based phone system, they are completely flexible, scalable and have many additional benefits. Here are some of the key benefits for businesses looking to switch to a cloud based phone system.

Save money by removing expensive hardware that needs to be maintained and replaced
Offer employees better flexibility and working from home options
Easy to set up and manage over the phone
No need for outdated plug-in phones
A dedicated account manager is provided for all accounts, they will be on hand for any issues, questions or concerns
Get set up in a matter of minutes with an online account and phone number
Completely scalable and flexible to your business needs
Access additional data and reporting to improve customer service operations

Benefits of using a cloud based telephone system

There are several benefits to running a cloud based telephone system.

With a cloud-based telephone system, enjoy traditional phone line features without installation or equipment costs. Skip hardware purchases and installation fees. Simply sign up with your service provider and download necessary apps or software on your computer, smartphone, or tablet. The best part? You also don’t have to pay for an actual telephone!

Lower costs
Reliability and performance
Implementation times
Reduced Maintenance
Feature-rich

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Enreach brings your teams together, your customers closer and makes amazing things happen for your business.

Our bespoke solutions work perfectly to boost the productivity, relationships and service that will transform your business through everyday telecoms miracles. We’ve helped over 5,000 businesses just like yours in the UK and as a group, many thousands more across Europe. For 25 years we’ve delivered on promises talking with clarity, not jargon. One provider, one contact, one bill. One happy you.

To find out more, or for some friendly advice on any help you may need to create contact magic, give us a call on 0333 3603 723 or email us at enquiries.uk@enreach.com.

Frequently asked questions

Is a cloud telephone system secure?

Security is highly important when implementing cloud-based phone systems. Through encryption, firewalls, and other security measures a high-level of security can be maintained. Also, cloud based systems are a managed service to tracking and monitoring is a central to the service a business receives.

Can I keep my number with a cloud-based phone system?

Yes, when migrating a phone system it is possible to port your business numbers(s), ensuring business continuity.

Where can I find information on ISDN switch off?

ISDN was originally due to be switched off January 2025, but the decision has been made to delay this until 2027 to ensure businesses can migrate. More information can be found on the end of ISDN.