Device Type: desktop
Skip to Main Content Skip to Main Content

What Is a Hosted Call Center & What Are Its Benefits?

If you run a call center, you’ve probably noticed how higher call volumes and more complex calls are making it ever more challenging. McKinsey’s State of Customer Care Survey, released in July 2022, revealed that 61% of customer care leaders had seen a growth in total calls, with a wider customer base and a higher number of contacts per customer. Those factors make it harder to deliver consistently great customer service. Modern technology is the solution — which is why it makes sense to use a call center system that’s efficient and scalable. Enter the hosted call center.


So, what exactly do we mean by a hosted call center, and how can it improve your customer service?

Illustration of a call center agent at work in front of a computer, talking into a headset to a customer.

What Is a Hosted Call Center?

A hosted call center means that the infrastructure required for handling inbound and outbound calls is based outside of your own business premises. It’s “hosted” by a third-party vendor, either at their physical location or data center, or in the cloud.

The term “hosted call center” is often used interchangeably with “cloud call center,” but they don’t necessarily mean the same thing. To put it simply: All cloud call centers are hosted, but not all hosted call centers are in the cloud.

A hosted call center system may still involve a physical server if it’s not cloud-based. But either way, your business won’t need to house any hardwired equipment. You just connect to the remote server over a network connection.

Typically, hosted call center solutions with physical servers are “single-tenant,” while those in the cloud are “multi-tenant.” Single tenancy means that only one client is using the software application and supporting infrastructure at a time. Multi-tenancy solutions serve multiple customers, each using only as much of the service as they need.

Hosted Call Center Vs. On-Premises Call Center: Key Differences

So now we know what a hosted call center is. But how does it differ, in practice, from its on-premises counterpart?


The first difference is pretty clear — an on-premises call center is located at your office, while a hosted call center is based offsite. 

The on-premises version requires call center agents to be physically present in order to access the system. With a hosted call center service, agents can work from anywhere with an internet connection, so you may not even need a physical premises.

Ownership and Responsibilities

The vendor who provides your hosted call center system has full ownership of the infrastructure and any physical equipment. They take care of maintenance and upgrades on your behalf. 

If you have an on-premises call center, you own the servers and the physical phone lines — and it’s your responsibility to install and maintain them. You’ll need an IT team or hired contractors to do this.


In an on-premises call center, your phones typically run on traditional landlines over a private branch exchange (PBX) and your computers are hardwired to your onsite server. 

This setup takes longer to install, and when you want to add a new agent, you may need new wiring. Hosted call centers utilize Voice over Internet Protocol (VoIP) technology, so calls are made over the internet. All you need is a router and connected devices.


On-premises call centers usually just have basic telephony features like hold, transfer, and voicemail. You can try to integrate other tools and communication channels, but it’s not easy.

Hosted call centers — especially those in the cloud — make it easier to offer omnichannel customer support and often come with features like intelligent routing, auto-dialers, and a virtual receptionist.

Security and Reliability

With a hosted call center, you’re putting security and reliability in the hands of a third-party expert. Service providers typically have redundant data centers and 24/7 monitoring to ensure your information is safe. As long as your internet connection is robust, you should experience great uptime and call quality.

An on-premises call center gives you more control, but it’s hard work to maintain security, especially as the system becomes obsolete. Additionally, traditional phone systems are generally reliable, although they can experience localized outages.

Photo of a call center; we see a side view of a row of working agents in a darkened room, their faces illuminated by the monitor screens in front of them. Vonage article
Say Hello: An Introduction to Call Center Software
The purpose of call center technology is simple — to help connect customers with your business. Learn about the basic features of call center software and some tips for finding the right system for your business.

What Are the Benefits of a Hosted Call Center?

The comparison of on-premises and hosted call centers reveals some of the key advantages of a remote offsite system. But there are plenty more, too:

Reduced Costs

On-premises call centers require you to house, install, and maintain your own infrastructure. That can get pretty expensive — there’s a high upfront cost for the equipment, and you’ll have to pay an IT team to look after it. As the system becomes outdated, it will often cease to give you a good ROI.

However, call center hosting can reduce these costs significantly. The subscription model allows you to pay monthly or yearly for the service, and you won’t have to buy any equipment (apart from devices and headsets for agents). You can use smaller premises, or dispense with real estate altogether and let agents work remotely.

Calls are also often cheaper with VoIP than with landlines. Plus, you may see cost savings from improved productivity, with agents able to handle more calls using advanced technology. Increased customer loyalty is good for your bottom line, too.


Hosted call centers are far more scalable than on-premises systems. You can manage a high volume of calls and keep an increasing number of customers happy. 

It’s also easier to add more agents as you grow, without having to install new physical phone lines. If your business is seasonal or if you know there’s a busy period coming up, you can add extra users to your subscription — and remove them when things quieten down (instead of buying perpetual licenses).

Because hosted call centers enable remote work, you can hire an unlimited number of staff from anywhere in the world. They can access the system at all times through an internet connection. Offering this flexibility will help you hire (and retain) the best talent.

Extra Features and Integrations

Having your call center hosted, especially if it’s in the cloud, gives you access to all kinds of capabilities that aren’t possible with on-premises systems.

For example, you might set up visual voicemail to transcribe messages into text form. Or you might offer self-service support through an Interactive Voice Recognition (IVR) menu, or even chatbots that can answer simple queries and escalate more complex ones to live agents.

You can easily connect extra channels for customer communication, such as video, instant messaging, SMS, email, and chatbots. You can also integrate your phone system to existing business tools and apps, such as CRM or workforce management.

Better Agent Experience

Having improved technology at their fingertips makes life a lot easier for your agents.

Hosted call centers are designed to cope with more calls and other interactions, using automation to route customers to the most suitable agent or self-service tools to handle basic queries. You can also implement auto or predictive dialers for outbound agents, to eliminate manual errors and improve productivity.

As well as reducing stress, it’s rewarding for agents to resolve customer queries quickly, which they can do more easily when all communication is centralized. And the potential for remote, flexible working helps to promote a healthy work-life balance. In an industry with high turnover, agent happiness is essential.

Better CX

Happy and engaged agents make for happy customers, but that’s not the only way in which hosted call center systems lead to customer satisfaction.

With the right hosted call center solution, you’ll be able to meet customers on more channels, offering maximum convenience — that goes for both inbound and outbound interactions.

With automated routing and self-service options, you’ll also be able to reduce the length of your call queue so customers don’t have to wait around on hold. When an agent picks up the call, they can instantly access relevant customer details from your other systems, enabling personalization and faster resolution.

Many third-party vendors also provide analytics tools to help you monitor the complete customer journey and find ways to improve. The insights you gain will facilitate further opportunities to personalize interactions and foster loyalty.

Hosted Call Centers: Solutions Better Suited to Customer Demand

Switching to a hosted call center can save you money on infrastructure, equipment, and maintenance. Additionally, it can improve the agent experience through automation and remote working opportunities, enabling you to retain more staff.

Crucially, it can also improve the experience for your customers. They want their queries answered and resolved as fast as possible, and you’ll be able to do that for them — even at times of high demand.

More ways to get in touch, less time waiting on hold or repeating information to different agents, personalized conversations — it all leads to improved satisfaction.

When companies make it easy to do business with them, consumers are likely to trust the brand more.

To learn more about how using a hosted call center solution could help make all this happen for your business, contact a Vonage expert today.

Contact Us

Let's connect!

Want to know more about the benefits of hosted call centers? We’re here to help! Call us at 1-844-365-9460, or fill out this form! A dedicated specialist will show you:

  • How a hosted call center can significantly reduce your costs compared to an on-premises model
  • How easy it is to scale up or down — there's no need to install new physical phone lines
  • The access you'll have to a range of additional features and integrations — such as video, instant messaging, SMS, email, and chatbots — to drive better customer experiences

Reach out

Oops! Something isn't right. Please try again.
This field is required
This field is required
This field is required
This field is required
This field is required
This field is required
This field is required
This field is required

By submitting your information, you agree to be contacted via phone and email regarding your interest in our products and services. We will treat your data in accordance with our privacy policy.


Thanks for reaching out!

We'll get back to you as soon as we can. In the meantime, feel free to explore more about Vonage and how we're making communications more flexible, intelligent, and personal so our customers can stay ahead.

Deskphone with Vonage logo

Speak with an expert.

US toll-free number: 1-844-365-9460
Outside the US: Local Numbers