Ready to build better conversations?

Simple to set up. Easy to use. Powerful integrations.

Get free access

How to choose the right cloud phone system for your business

Customers and prospects expect calls to be answered quickly, and they want instant answers to their questions. Outdated communication tools present serious hurdles to meeting these demands, as they lack many of the features that help you provide a personalized and frictionless customer experience. 

A cloud-based phone system offers the flexibility you need to stay connected with users, customers, and sales prospects without sacrificing the personal touch. It ensures you’re always reachable, helps you manage your time efficiently, and maintains the human connection that’s essential for strong client relationships.

This guide explores how these systems work, their pros and cons, why you should use one, and the top tools for businesses to consider. 

TL;DR

• A cloud-based phone system uses VoIP technology and cloud hosting to deliver secure, reliable calling without on-premise hardware.

• Cloud phone systems offer major advantages like scalability, lower maintenance costs, AI-powered features, and integrations with existing business tools.

• The potential drawbacks involve dependence on a stable internet connection, potential hardware upgrades, and the need for proper security measures.

• Leading cloud phone providers such as Aircall, RingCentral, Grasshopper, Vonage, Dialpad, Nextiva, and 8x8 cater to different business needs across size, features, and AI capabilities.

• The best cloud phone system for your team depends on ease of use, support, integrations, analytics, security, and how well the platform fits your existing workflows.

How does a cloud-based phone system work?

More than 85% of companies around the world now use cloud-based technologies like phone systems in their operations, and for a good reason.

A cloud-based phone system replaces physical phone lines with internet-powered communication. Rather than relying on on-premise hardware, every phone call, voicemail, and recording happens securely on the cloud. This gives your team flexibility and control over communications from anywhere. Here’s how it works.

• Internet-based communication: Cloud phone systems use Voice over Internet Protocol (VoIP) technology to convert your voice into small digital packets. These packets travel via IP telephony to the person on the other end of the line, which ensures reliable sound quality without the need for complex hardware.

• Cloud hosting: Instead of having all kinds of equipment on-site, all call data and routing happen on remote servers hosted in the cloud. This setup helps reduce maintenance and IT costs.

• Connection to the public telephone network: Through SIP Trunking and partnerships with global carriers, cloud-based phone services connect easily with a traditional phone network. This means you can make and receive calls from standard phone numbers and not just internet-based IDs.

The pros and cons of a cloud-based phone system

Before you switch to another phone system, you’ll want to consider the pros and cons of investing in cloud-based technology for your communication needs.

Pros

• Easy to set up and scale and updates automatically in the cloud 

• Saves you money on maintenance and replacing equipment 

• Intuitive dashboards give you insights into current and historical call activity

• Connects to your essential business tools

• Mobile-friendly and enables remote, hybrid, and dispersed work setups

• Teams can collaborate on accounts in real time

• Often comes with time-saving AI features like conversation intelligence and AI agents

• Savings on international calling

Cons

• Requires a reliable internet connection, which depends on your internet provider 

• If your business already owns traditional phones, you may incur extra expenses for VoIP adapters or replacements for VoIP-compatible phones 

• Can be susceptible to security issues like hacking and malware (can be reduced with extra security measures)

7 top cloud-based phone systems 

To help you make the best decision for your business, we've highlighted seven of the best cloud-based phone systems on the market.

Aircall: Best for businesses of all sizes that want a reliable phone system with powerful AI features

Aircall’s versatile cloud-based phone system is designed for modern teams that need fast, reliable communication. It connects with over 200 business tools, like CRMs (including HubSpot and Salesforce) and helpdesk tools (including Intercom and Zendesk), making it a natural fit for both customer support and sales teams.

What really sets Aircall apart are its AI-powered capabilities. With AI Assist Pro, your team gets automatic call summaries, in-call guidance, key topic recognition, sentiment analysis, action item suggestions, and CRM and helpdesk autofill. 

Meanwhile, AI Voice Agent works as your always-on receptionist that can handle inbound calls, collect caller details, escalate to live agents, and operate 24/7. This feature covers peak and after-hours periods so you never miss a call again. 

Trusted by over 20,000 companies of all sizes, Aircall is a reliable AI-powered customer communications and intelligence platform that transforms sales and customer support processes. 

Key features

• AI Assist Pro

• AI Voice Agent

• International Numbers

• Smart Call Routing

• Interactive Voice Response (IVR)

• Call Coaching and Whispering

• Analytics

• Live Monitoring

See for yourself why Aircall is the leading cloud phone system on the market. Try for free today.

RingCentral: Best for entirely remote businesses

RingCentral gives you a clear overview of the status of all your rooms and devices.

Source

RingCentral brings together voice, video, messaging, and collaboration tools in one unified platform. This makes it a good choice for businesses that want to simplify communications across departments and locations.

It helps teams stay productive with features like distributed call recording, agent performance tracking, and customizable dashboards that give support leaders real-time insight into activity and performance.The platform also makes it easy to host virtual meetings, send instant messages, and share files, all without switching between apps. 

Key features

• Toll-free and vanity numbers

• Local numbers

• IVR

• Call recording

• Call routing and queue management

• Whisper, monitor, and barge-in

See our RingCentral alternatives comparison for more information, or check out an in-depth review of RingCentral vs. Aircall. 

Grasshopper: Best for small businesses and entrepreneurs who need to communicate on the go

Grasshopper is available on both desktop and mobile devices.

Source

Grasshopper gives you a clean, no-fuss virtual business phone system that fits the on-the-go needs of small teams and solo operators. The tool gives you a second number to keep business and personal lines separate, plus custom greetings that help reinforce your brand’s professionalism.

Grasshopper enables you to handle business calls and texts from both your desktop and mobile phone (available via iOS and Android apps). You get access to features like auto-attendant, call forwarding, voicemail transcription, and business texting, all without needing a physical desk phone.

Key features

• Extensions for call routing

• Custom greetings

• Toll-free, vanity, and local numbers

• Call forwarding

• Voicemail transcription

• Simultaneous call handling

See our Grasshopper alternatives comparison for more information, or check out an in-depth review of Grasshopper vs. Aircall.  

Vonage: Best for small businesses looking to unify global business communications

Vonage offers both a desktop and mobile app so your team can stay connected wherever they are.

Source

Vonage puts all your conversions under one roof, including voice, video, messaging, and chat. It provides unified communications as a service (UCaaS) and allows you to build custom workflows with voice-first features. 

The platform stands out for its global business communications capabilities and provides tools for contact centers and conversational commerce, making it a good choice for improving customer satisfaction and sales results. 

Key features

• Automatic call distribution

• Call flip

• Local and international business numbers

• Voice and video conferencing

• Queue and hold features

• Call forwarding

See our Vonage alternatives comparison for more information, or check out an in-depth review of Vonage vs. Aircall. 

Dialpad: Best for teams wanting to use AI technology to streamline communication

Dialpad’s AI features summarize your calls and automatically extract action items.

Source

Dialpad connects teams through voice, video, messaging, and online meetings. With features like auto-attendant, call recording, and call routing, it integrates all your business communications into one platform. 

The platform’s standout feature is its Dialpad AI, which transcribes calls, takes notes, and provides real-time communication insights. It also integrates well with tools like Google Workspace, Salesforce, and Zendesk to keep your tech stack connected. 

Key features

• Visual voicemail

• Call recording

• Power dialer

• Muti-device access

• Real-time transcription

• AI-powered coaching

See our Dialpad alternatives comparison for more information, or check out an in-depth review of Dialpad vs. Aircall. 

Nextiva: Best for mid-market teams that need a full-scale system

Nextiva’s agent dashboard metrics like AHT, occupancy, and total handle time. 

Source

Nextiva helps businesses unify communications across voice, video, chat, and SMS. For mid-sized companies or growing teams in sales, support, or customer service, it offers features and reliability that help you scale without old-school telephony bottlenecks.

It provides a cloud-based phone service, desktop and mobile apps, video meetings, business SMS/MMS, integrations with CRMs and team collaboration tools, and network architecture designed for uptime and coverage.

Features

• Unified inbox

• Call routing

• Call queuing 

• Call recording and monitoring

• Video and team meetings

• SMS/MMS support

8x8: Best for large teams looking for one platform for global communications

8x8 offers an agent workspace for centralising each team member’s conversation history. 

Source

8x8 is a full-scale communications suite built for companies with multiple locations and global reach. With voice, video, chat, meetings, and contact-center functionality all brought into one platform, it offers organizations a way to unify communications.

The tool delivers global-ready numbers, cloud-based routing, and mobile apps that let teams stay connected no matter where they are. And analytics and APIs for custom integrations make it more powerful than your average business phone system. 

Features

• Omnitichannel routing

• Call recording

• Intelligent Customer Assistant (ICA)

• Real-time AI guidance during customer interactions

• Advanced analytics

• Global coverage

Why use a cloud phone system? 7 key benefits

A cloud-based phone system typically offers more advanced features that increase productivity and improve how your business communicates compared to traditional phone systems. 

Below are some of the reasons why more companies are making the switch to a cloud business phone system.

1. Cost-effective setup and maintenance: Because everything runs in the cloud, there’s no expensive hardware to install or maintain. Updates roll out automatically, so your system stays current without any extra fees or downtime.

2. Flexibility for modern teams: Cloud systems work wherever you do. Everyone on your team can make and receive calls from any device, no matter where they’re located, which keeps conversations seamless for remote, hybrid, and dispersed teams.

3. Scalability that matches your growth: As your business grows, the best business phone system will scale with it. With a cloud phone system, adding or removing users takes minutes, not days. And there’s no need for complex IT reconfigurations or new infrastructure as you grow.

4. Ease of use: These systems are intuitive and often quick to learn. Admins can configure cloud phone system features, set up call routing, or add integrations themselves without the need for IT support.

5. Smart integrations with your existing tools: You can connect your phone system directly to the tools your teams already use, including CRM and helpdesk software, sales automation tools, and internal communication platforms.

6. Time-saving benefits: Features like call forwarding, IVR, and AI voice agents help reduce time spent on manual work to free up your agents for more impactful tasks. 

7. Local numbers: You can build trust and familiarity with your customers by using local area codes that make your business feel close to home.

How to evaluate a cloud phone system

Your choice of a cloud business phone system should be based on how well it fits your team’s workflow and whether it can scale with your business. Here are some things to consider as you evaluate potential solutions. 

• Ease of use: The platform should be intuitive for both admins and users. Look for a clean interface and simple navigation, as well as features that can be managed without a lot of technical expertise. Cloud-based systems that are easy to adopt minimize training time and ensure your team makes the most of the platform.

• Implementation and onboarding support: How quickly can your team start using the system? Check if the provider has guided onboarding and dedicated support during setup. Solutions that offer account managers or onboarding specialists can make your transition smoother.

• Ongoing support: You should have access to multiple support channels where the platform’s team resolves issues and answers questions quickly. Reviews often tell you whether the support team actually helps in day-to-day operations.

• Analytics and reporting: Look for call volume dashboards, team and individual metrics, call recordings, and trend analysis. These tools can help you spot bottlenecks and coach your teams based on tangible feedback.

• Integration capabilities: Ensure the system you choose connects seamlessly with your existing tech stack, including CRMs, helpdesk software, and collaboration tools. 

• Security and compliance: Voice and messaging data need to be protected. Choose a provider that offers end-to-end encryption and secure cloud hosting, as well as compliance with standards like GDPR and HIPAA, if this is relevant to your business.

Key features to look for in a cloud phone system

You now know how to evaluate a cloud phone system, but what features should you keep an eye out for when making a final decision? Here are some of the factors that can make a real difference.  

Still need help making up your mind? Check out our cloud-based phone system buyer’s guide.

Aircall: An all-in-one cloud phone solution for modern business communication 

Aircall’s voice-first customer communication platform is powered by AI and can completely change how your team connects with customers and collaborates internally.

With AI Assist, every call automatically generates summaries, highlights key discussion points, extracts action items, and even flags caller sentiment. This gives you and your team clear next steps while eliminating time-consuming manual tasks like post-call summaries.

And the AI Voice Agent handles inbound calls, gathers caller information, answers routine questions, and escalates complex inquiries to live agents. All of this ensures no call goes unanswered and frees up your team to focus on high-value customer interactions.

Aircall customer SJWD, for example, has been able to resolve 90% of after-hours calls with the AI Voice Agent, decrease average resolution time from 150 sec to 55 sec, and offer 24/7 bilingual customer support capability. 

See for yourself how Aircall’s AI-powered cloud phone system can boost your team’s efficiency while improving customer outcomes. Try for free today.

Frequently asked questions about cloud phone systems

What is a cloud phone system?

A cloud phone system is a phone service hosted entirely online, rather than relying on traditional phone lines or PBX hardware. It uses VoIP technology to send voice over the internet. This allows teams to make and receive calls on desktops, laptops, or mobile devices.

How much does a cloud phone system cost?

Pricing for cloud phone systems varies depending on the provider and the number of users. Most cloud phone systems charge a monthly subscription fee per user, typically ranging from $20 to $50 per month for standard plans, with higher tiers for advanced features like AI tools and call center functionality.

Can I use my existing number with a cloud phone?

Yes, most cloud phone providers allow you to port your existing phone number into their system, so you can keep the number your customers already know.

Is a cloud phone cheaper than a landline?

Cloud phones can be cheaper than landlines because they eliminate the need for physical PBX hardware, desk phones, and expensive maintenance. The exact savings depend on your team’s size and call volume, but you’ll often see a lower total cost of ownership and more flexibility.

Published on October 30, 2024.