The fax that arrives on the other end looks the same no matter how you send it.
That is the part most comparison guides get wrong. They frame this as a choice between a physical machine and the cloud, as if the document format is what changes.
It isn’t. The document stays the same. What changes are the cost to send it, where it is stored, who controls it, and how it fits into the way your team already works.
Organizations that have moved faxing into Microsoft Teams are comparing on those terms instead. Cost, security, and workflow. Three axes, three faxing models, and a clear way to decide.
The right fax model for your organization depends on your compliance needs, operations, and existing workflows.
The three ways businesses fax today
| Model | How it works | Where documents live |
| Fax machine + analog line | A physical device connected to a POTS (plain old telephone service) line. Paper in, paper out. | A paper tray, a filing cabinet, or nowhere at all. |
| Standalone cloud fax service | An online fax service like eFax or MyFax. Send and receive through a web portal or email. No hardware needed. | The vendor’s cloud. Their servers, their encryption, their retention policies. |
| Teams-native, in-tenant faxing | A fax app built into Microsoft Teams. Send and receive from the same interface your team uses for calls and chat. | Your own Microsoft 365 tenant. SharePoint or OneDrive, under your encryption, DLP, and retention policies. |
Cost and operational differences
A fax machine carries costs that do not show up on a single line item. There is the device itself, the analog line rental, paper, toner, and the maintenance contract or service calls when it jams. Someone has to load paper, clear the tray, and walk documents to the right person. In a multi-site organization, multiply that by every location that still has a machine plugged in.
Standalone cloud fax services cut the hardware and the analog line. You pay a monthly subscription based on page volume, and sending happens through a web portal or email. That removes the physical overhead. But you are still managing a separate platform with its own login, its own admin console, and its own billing. If multiple departments fax, each may need its own account or number allocation.
Microsoft Teams-native faxing consolidates further. The fax app runs inside Microsoft Teams, which means no separate portal, no additional credentials, and no standalone vendor contract to manage. Fax numbers, permissions, and storage all run through your existing Microsoft 365 admin tools. For organizations already operating on Teams, it removes a vendor rather than adding one.
The cost comparison is not only about the monthly line item. It includes the time your staff spends managing a separate tool, the IT overhead of maintaining another vendor relationship, and the compliance cost of validating a third-party environment every audit cycle. Those operational costs add up in ways that do not appear on an invoice.
Security and compliance differences
Encryption in transit is baseline. Every reputable fax provider, physical or cloud, protects the document while it is moving. The question that separates these models is what happens after the fax arrives.
With a fax machine, the document lands on paper in an open tray. Anyone near the machine can see it. A $387,200 HIPAA settlement resulted from a healthcare provider faxing patient records to the wrong recipient, twice, because the physical process had no access controls and no verification layer. Paper in an open tray is a compliance gap that no policy document can close.
A standalone online fax service moves the document off paper, but it moves it into the vendor’s cloud. The vendor’s encryption applies. The vendor’s data retention policies apply. If your organization operates under HIPAA fax requirements, PCI mandates, or state privacy laws, your compliance team has to evaluate and trust a third-party environment you do not control.
Teams-native, in-tenant faxing changes that equation. Every fax, sent and received, is stored in your own SharePoint or OneDrive environment. The fax provider retains nothing. Your existing controls apply from the moment the document arrives:
- Encryption at rest: Microsoft 365 encryption covers the fax the same way it covers every other file in your tenant.
- DLP policies: Data loss prevention rules you already enforce on email and documents extend to fax files automatically.
- Retention and legal hold: Fax records follow your organization’s retention schedule, not the vendor’s.
- Role-based access control: Only the people your IT team authorizes can view or retrieve faxes, managed through Microsoft Entra ID.
For organizations in government or high-compliance environments, that distinction between vendor-hosted storage and in-tenant storage is often the deciding factor.
Workflow and integration differences
Standalone cloud fax services
A standalone service runs in its own portal. Staff log in separately, manage contacts in a separate system, and retrieve documents from a separate archive. For light fax users, that may be fine. For organizations that fax regularly across departments, it adds another tool to an already crowded stack.
Files have to be downloaded from the vendor portal and re-uploaded wherever they need to go next. There is no native connection to your document management system, your CRM, or your compliance archive.
Teams-native faxing
When faxing runs inside Microsoft Teams, staff send and receive from the same application they already use for calls, chat, and file sharing. Single sign-on means no additional credentials. Fax records write directly to SharePoint, so there is no download-and-reupload step. Call detail records export on schedule for compliance reporting, and the entire process connects to Power Automate for routing, labeling, or triggering follow-up workflows.
The practical difference is fewer tools, fewer logins, and a document trail that exists automatically in the environment your IT team already manages.
How to choose
The right faxing model depends on how much you fax, what you fax, and what your IT environment looks like. These guidelines sort the decision by organization type:
- Low volume, no compliance requirements: A standalone cloud fax service handles occasional faxes without hardware. If you send a handful of documents a month and none of them contain regulated data, a simple subscription-based service is likely enough.
- Moderate volume, growing compliance pressure: Organizations starting to face audit questions about where fax documents are stored should evaluate whether a vendor-hosted model will hold up under review. In-tenant storage simplifies that conversation.
- Regulated, multi-site, or Microsoft-heavy environments: If your organization operates under HIPAA, PCI, or state data privacy laws, runs Microsoft Teams across locations, and faxes regularly, in-tenant faxing keeps documents under the same controls as the rest of your data. No third-party storage, no separate compliance review.
Organizations that land in that third category often already have the Microsoft 365 infrastructure in place. The remaining question is how to move faxing off analog lines and into Microsoft Teams without disrupting what is already working.
Match the fax model to your industry and compliance requirements
The fax itself has not changed. What has changed is how much rides on the infrastructure around it. Where the document is stored at rest, who controls access, and whether the system creates an automatic record or relies on someone to file one manually.
Organizations that fax regulated, sensitive, or high-volume documents need a model where compliance is built into the architecture, not bolted onto a vendor agreement. In-tenant faxing through Microsoft Teams puts documents under the same encryption, retention, and access controls that already govern the rest of your data.
Momentum builds and supports Teams-native faxing deployments, with one team handling architecture, setup, and ongoing support.
Talk to a Momentum cloud faxing expert about a faxing model that keeps your documents under your own controls.
FAQs
Is cloud fax cheaper than a fax machine?
Usually, yes, over time. Cloud fax removes analog line rental, hardware purchases, paper, toner, and service calls. The ongoing cost is a software subscription based on volume. For organizations with multiple fax machines across locations, the savings compound because you are eliminating physical infrastructure at every site.
Is cloud faxing HIPAA compliant?
It can be, but compliance depends on more than encryption in transit. The critical factor is where documents are stored at rest and whose controls govern that storage. A cloud fax service that stores documents in the vendor’s environment requires you to trust and verify their compliance posture. In-tenant faxing stores documents in your own Microsoft 365 environment, where your existing HIPAA controls already apply.
What is the difference between an online fax service and Teams faxing?
An online fax service stores documents in the vendor’s cloud and runs in its own web portal with its own login and admin tools. Teams faxing stores documents in your own SharePoint or OneDrive environment and runs inside Microsoft Teams, using your existing credentials, permissions, and compliance controls.
Can I keep my existing fax number if I switch to cloud fax?
In most cases, yes. Most cloud fax providers support number porting, which lets you transfer your existing fax number to the new service. The process typically takes a few business days depending on the carrier. You can also add new local or toll-free numbers if needed.
Can someone with a traditional fax machine send a fax to a cloud fax number?
Yes. Cloud fax numbers receive faxes from any source, including traditional fax machines, because the transmission still uses the public switched telephone network. The sender does not need to know or do anything differently. The fax arrives as a digital file on the receiving end instead of on paper.
