What is cloud telephony and how does it work?
What is cloud telephony and how does it work?

Cloud telephony is an innovation that offers the rare advantage of being able to cut costs significantly, while increasing agility and business performance. Now is a critical moment for businesses to consider adopting a VoIP Phone Systems for Business and the scalability it unlocks.

In this article we cover everything you need to know about cloud telephony and how it works.

What is cloud telephony?

Cloud telephony enables organisations to operate their business phone systems via an internet connection. Also known as cloud calling, cloud telephony is an example of unified communications as a service (UCaaS), which is managed and hosted by a third-party.

BT One Phone For Corporates provide a means of consolidating an array of communications and collaboration tools in a low-maintenance solution. Not only does this offer staff a seamless way of using different types of communication, but CRM systems and tools like Microsoft 365 can also be integrated directly. This capability enhancement boosts the efficiency of teams and improves the overall customer experience. 

How does it work?

Cloud telephony works by converting analogue voice signals into data packets, then transmitting them via the internet. Once a number has been dialled, a third-party VoIP (Voice over Internet Protocol) service provider handles the process of routing the call. This technology solution completely erases the need for Traditional phone lines, which are typically very costly, and must be managed by the user.

At the beginning of the process, an organisation will select a provider capable of delivering a telephony platform end-to-end. 

This includes the creation, operation, and ongoing maintenance of the service. Providers will often use a subscription model to enable customers to have access to their cloud calling solutions, with payments usually made monthly. This highly flexible structure promotes business agility by negating cumbersome contracts and unnecessary physical equipment.

While most welcome the opportunity to outsource maintenance efforts, some may still want to keep the option to have direct control. The powerful and flexible nature of cloud technology means that IT teams can still tweak and adjust system settings via an easy to use, online dashboard. This provides the opportunity to have direct influence over call forwarding, numbers, and extensions.

What are the benefits?

Cloud calling is:

Future proof

Industries across the world are standing on the cusp of significant change, with various emerging technologies set to mature and begin a new era of business. Because of this, organisations require as much room to scale and compete as they can get. Leading VoIP systems will equip you to add new features and users as required, with an ability to only pay for what you need and use.


With increased innovation and opportunity, security has also become a greater concern than ever for businesses. As threats increase and regulations tighten, VoIP provides Secure Voice and SIP over TCP, keeping calls and other communications within the security of your network. Crucially, VoIP enables organisations to give their workforces the benefits of remote and flexible working, without compromising on security.

Cost effective

Above all, VoIP is a cloud-based phone system that alleviates the need to buy expensive equipment and conduct costly maintenance. This benefit compounds if your organisation operates across multiple sites, as there is no need to buy and maintain duplicate equipment in other locations and countries. Other cost-saving opportunities include lower rates on long-distance calls and pay-as-you-go efficiency.


Cloud calling solutions enable users to not only have access to a wide range of features, but also access new ones as they emerge or as they are needed. A prime example of these features is the ability VoIP provides to integrate mobile devices, enabling incoming office phone calls to be diverted to mobile handsets. This ensures that effective on-the-go communication can be maintained. Other key features include call-forwarding, transfers, and efficient three-way calling.


Remote working trends have made it essential that teams are able to make calls via the office phone system from anywhere. VoIP solutions provide this important capability that is so conducive to productivity and business continuity. In addition, VoIP also allows employees to securely use instant messenger to share data and communicate, promoting agility and saving time. The inflexibility of landline approaches is becoming a major inhibitor of growth and scale.

Industries across the world are standing on the cusp of significant change, with various emerging technologies set to mature and begin a new era of business. Because of this, organisations require as much room to scale and compete as they can get.

Cloud telephony vs VoIP

Most cloud telephony services use VoIP, but the cloud is not essential for a VoIP system to operate. On a technical level, VoIP relates to how data is transferred, and in this case, it travels via packet-switched connections. This capability contrasts the traditional method that operated via the public switched telephone network (PSTN).

VoIP phone system equips its user with all of the capabilities of a traditional PBX system, but with increased cost efficiency and reduced hardware requirements. This method can be enhanced with cloud hosting, and functions by converting voice into digital signals. This enables users to seamlessly make calls from their computer, mobile device, or desk phone, no matter where they are.

To summarise this differentiation, an enterprise can run a VoIP system by itself on-site with a PBX model, or embrace cloud calling by outsourcing the responsibility to a third-party. For some organisations, depending on structure and industry, it may be preferable to devise a hybrid approach that uses both a cloud phone system and PBX on a long-term basis.

Moving to a cloud-based phone system

The biggest hurdle for many organisations is the disruption they anticipate when transitioning to a cloud telephony solution. Working with the benefits of moving to a cloud based phone system is the best way to make the process smooth and effortless, enabling you to avoid downtime that affects you and your customers.

Discussing the support your organisation will require up-front is highly beneficial to the overall process. Once this is complete, a service level agreement (SLA) can be tailored to your company’s specific needs. It is crucial to note that not all providers offer the same level of support, with some offering 24/7 service monitoring, while others work on a 48-hour turnaround basis.

Security is another factor that requires extra attention at the outset when transferring sensitive, valuable data. Because of this, you need to be clear on whether the provider you are working with offers a comprehensive security policy that is compliant and bespoke to your business. At BT, we go to extra lengths to maximise our security capabilities, even hosting our systems from different geographical locations to provide greater peace of mind.

When the move is complete, your workforce will have immediate access to applications, databases, and other useful resources wherever they are. This setup can be further optimised by storing your organisation’s data in the cloud, therefore reducing, or removing the need for costly in-house server storage.

Above all, you need to have confidence in your provider when taking this important step. A good provider must firstly demonstrate experience of working closely with other businesses like yours, supported by references and case studies. They must also be able to offer you an end-to-end solution, requiring them to take ownership when overcoming challenges. Lastly, SLAs and security policies that suit your company’s individual needs are a must.

We are a provider that offers this level of support, and more. Find out more about VoIP Phone Systems for Business

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