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Jun 24 2025
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3 Cost-Saving Advantages of a Cloud-Based Phone System

The benefits government agencies see from cloud services of all kinds now apply to phone systems as well.

For state and local government agencies, cost is nearly always a factor when considering whether to adopt a new technology. Any solution should deliver on functional expectations, but it should also provide the agency with a reasonable return on its investment.

Here are three benefits of moving phone systems to the cloud:

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1. Cloud Phones Minimize the Need for Infrastructure

With an on-premises phone system, there are servers and other infrastructure that need maintenance, upgrades and — at end of life — complete replacement. Additionally, physical hardware may require significant electricity to operate, and at many agencies, that takes up valuable space that could be used to house something else.

Cloud phone systems do require routers and switches, but the bulky, energy-intensive physical servers live with the vendor. The need for physical desk phones is also eliminated because calls can be made and received through an app.

2. Cloud Phones Provide Better Scalability

When the onsite servers of an on-premises system have reached maximum capacity, an agency must purchase new physical machines. For many agencies, this drives overspending as they look to pad their infrastructure in anticipation of possible future needs

With cloud phone systems, on the other hand, there’s no guesswork involved. Agencies simply buy the capacity they need at any given time and then scale back when the demand subsides — no additional carrying costs required. This can be especially helpful when communications tend to peak, as they do during the end of the fiscal year, for example.

READ MORE: States can navigate FY 2026 budget uncertainty through IT modernization.

3. Cloud Phone Systems Allow IT Teams to Operate More Efficiently

With cloud vendors managing and maintaining the back-end infrastructure of a phone system, government employees have more time to devote to other tasks. The cloud vendor takes care of everything — patching and upgrades, the replacement of broken parts, resilience and disaster recovery — as part of the foundational service it provides.

The resulting cost savings can be hard to quantify but easy to imagine in terms of efficiency gains. Without a fleet of servers to maintain, for instance, IT might ramp up support to directly advance an agency’s mission.

There are other cost advantages to cloud-based phone systems, especially when it comes to adoption of emerging technologies. In a competitive marketplace, cloud vendors are incentivized to continually push the envelope with new tools that might further improve their systems; artificial intelligence is a good example. The good news is, once an organization has signed on for the service, those future advancements are baked in.

Should all government agencies say goodbye to their on-premises phone systems? I’d advise officials to crunch the numbers and decide for themselves if moving makes sense.

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