Cloud Fax vs. Legacy Fax: Cost & Compliance Benefits

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Paperless Productivity

Posted on: April 8, 2025

Traditional fax servers are familiar and trusted, but they bring serious cost, maintenance, and compliance burdens.

Cloud fax services have matured into full-featured, enterprise-friendly applications. They have exploded in popularity by directly addressing the problems of legacy fax. Properly deployed, they also open up entirely new kinds of cost-saving digital workflows.

We’ll elaborate on why these differences exist and what they mean for competing in today’s bigger, faster, more demanding market.

Our fully managed Private Fax Cloud® architecture further eases cloud fax implementation and adoption. It’s designed from the ground up for healthcare organizations that need HIPAA-compliant faxing without the overhead of on-premises infrastructure.

Background: Traditional vs. Cloud Fax Design

A traditional fax server uses on-premise hardware and software to send and receive faxes. Like any other application server, the fax server is fully under the client’s control. But with full control comes full responsibility: updates, service levels, compliance, and so forth fall solely on the client’s IT staff.

Cloud fax works and feels more like web email. A familiar user interface, an API for custom integrations, and a fax “engine” are all maintained by the vendor and available on a subscription basis.

Both are viable for large organizations, even in highly regulated industries like healthcare. Over the past decade or so, cloud faxing has matured to match the features and security of on-prem servers at a fraction of the cost or maintenance burden.

AttributeTraditional fax serverCloud fax service
HardwareOn-premN/A
SoftwareOn local hardware
MaintenanceInternal IT’s responsibilityVendor’s responsibility
HIPAA compliance supportYesYes
Data encryptionDepends on client configurationYes
Data sovereigntyTotalLimited (depends on vendor, service tier, and contract terms)
Data residencyOn-premDepends on vendor (some will guarantee it)
Telephony & connectivityPhone lines and/or internetInternet only
Service levelHighly variableGenerally specified in contract
Cost structurePrimarily capexOpex
Implementation effortHighLow
Implementation costHighVery low
Per-document costHeavily depends on volumeFixed or slightly decreasing with volume
ScalabilityTightly constrainedNo practical limit
Desktop app integration effortMedium to high (unless native connector exists)Low to medium (but generally limited to REST API)
Web app integration effortMedium to highLow to medium

Cost Savings with Cloud Fax

Cloud fax costs less for most clients. The usage-based prices, lack of admin burden, and linear costs almost always reduce total cost of ownership compared to fax servers.

  • Usage-based pricing frees up capital and shifts costs to opex.
  • Maintenance and updates are part of the subscription.
  • Scaling up or down requires no effort or expenditure.

There may be exceptions at extremely high volumes, but those situations are rare—even among the major provider networks and insurance companies we serve.

Compliance Benefits

Today, legacy fax servers and cloud fax products both support HIPAA compliance.

In years past, fax servers were seen as the gold standard of security. Every possible parameter is controlled by and visible to the client.

Today, however, cloud fax security has closed the gap. Encryption protocols, data center security measures, audit logging features, and so forth are on par with on-prem solutions. Generally, enterprise cloud fax vendors will sign BAAs, guarantee data residency, and assume full responsibility for security patching and technical audits.

The Role of Private Fax Cloud®

Public cloud fax services fulfill most needs, even at a large scale. However, many organizations still need:

  • Native integrations with Windows applications and MFPs/MFDs
  • Print drivers
  • Document queue management
  • Built-in OCR and workflow triggers

Features like these aren’t readily available through fax solutions on the public cloud, but they’re all native to RightFax—the longtime fax server market leader.

Our fully managed Private Fax Cloud® architecture merges proven RightFax software with simple and scalable cloud services, all in a dedicated environment.

Cloud Fax Considerations for Executives

Cloud adoption fundamentally changes enterprise decision-making.

As a CIO, you’ve probably felt the pains of fax servers more acutely than anyone. You’ve had to devote resources to things like hardware failures, software updates, and compliance audits—which don’t drive innovation. Cloud faxing removes these burdens without sacrificing security or reliability.

As a CFO, the capital requirements for a fax server may be uncomfortable. Scaling the server is a touchy topic: it requires upfront expenditures that aren’t easily cut back if (or rather when) the growth trajectory changes. Cloud fax, on the other hand, is an operational expense that directly and transparently tracks actual usage, and requires next to no in-house support.

In short, modern fax solutions can help execs to steward their organization’s resources while saving capital for key growth levers.


If your organization has more unique information management requirements, then our Private Fax Cloud provides the same advantages along with absolute control over data and telephony.

To explore public and private cloud solutions with an enterprise solutions engineer, please reach out today.

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