Cloud vs. On-Premise: What to Know

By 2020 more than 90% of companies will use multiple cloud services providers. What does that ultimately mean? From the business perspective, how is cloud different from on-premise? If your company is planning to make changes and shift from on-premise to cloud-based software and technology, what do you need to be aware of?

The following are some of the most important things to know about cloud vs. on-premise networks and software.

 What is On-Premise Software?

On-premise software requires that an organization purchase either a license to use software or a copy of the software. When you buy on-premise software, you will usually see pricing is based on a one-time licensing fee. That fee can be based on the size of your company or the number of users. On-premise software may also include recurring costs for updates, training and ongoing support.

On-premise software systems will usually require further investment to ensure you have the necessary equipment to utilize the software.

In most cases, on-premise software is characterized as a capital expenditure or one big upfront investment.

However, that one-time cost element can be beneficial for some organizations that want to be able to forecast more accurately and don’t want the concern of estimating an ongoing, recurring cost.

If you’re a startup, you might not be able to make a large initial purchase though, which can keep you from going the on-premise route. You are also responsible for all maintenance with on-premise solutions.

For example, you’ll have to maintain server hardware and software, storage, and any necessary data backups as well as disaster recovery. This may not be an option for companies with small budgets and limited resources.

You’re also going to need to expect a longer implementation period with on-premise software since it has tobe individually installed on devices and servers.

While a lot of organizations are moving away from on-premise solutions, they do still have benefits. One is that they’re highly customizable. If you’re in a unique niche, this can be especially valuable.

On-premise solutions also put more control in the hands of the business,sothey’re not cloud-dependent. They can then ensure their data and information is fully protected in the way they see as best.

What is Cloud Computing?

When you have on-premise software, you’re hosting everything in-house and on your own equipment and servers. With cloud computing, a third-party hosts for you and then you pay as you need. This flexibility to scale up or down as necessary is something that appeals to a lot of businesses, particularly when their budgets are small.

When you use cloud computing, since everything is offsite and you pay as you go essentially, then there aren’t capital expenses. You’re only paying for what you need, and since everything is ready to go, you’re almost immediately up and running as soon as you subscribe.

Security and Compliance

Two areas of increasing concern for most organizations around the world are security and compliance. If you’re in certain industries where you handle sensitive data,oryou’re faced with stringent regulations, you may use on-premise software primarily.

When it comes to barriers to more adoption of cloud technology, security is number one. There are often cloud breaches, and it gives organizations, especially in certain industries, pause when they’re comparing on-premises versus cloud computing.

If an enterprise that does have to meet high regulatory and compliance standards goes with a cloud provider, it’s up to them to make sure that third-party provider is compliant with regulatory requirements.

Accessibility

While you can see how there are pros and cons to both cloud and on-premise solutions, one of the biggest issues with on-premise right now is the lack of accessibility. This is a prime reason that companies are foregoing on-premise altogether.

Employees are often dispersed around the country and the globe. They need to be able to access work information as-needed, from anywhere. Most people are no longer tied to a desk or an office, and on-premise solutions simply don’t provide the flexibility and accessibility most modern enterprises need.

Finally, it may be that your business is best suited to a hybrid cloud computing approach. Hybrid cloud computing environments combine on-premise solutions with private and public cloud services in most cases. For businesses that don’t want to be entirely dependent on the cloud, but also want that flexibility, scalability,and accessibility of the cloud, a hybrid solution often works very well. It gives them the ability to balance their reliance on both, and they have more diverse data deployment options available.