What’s best for your business: cloud, on-premise, or both?

Last Updated on April 7, 2022

There is no clear-cut answer about whether cloud computing or owning a data center is better. Both options have their advantages and drawbacks, so it ultimately depends on the organization’s specific needs.
While cloud computing provides many benefits, there are also some advantages to having your own data center.

There are many advantages to using cloud solutions, but it is best to consider all options when making a decision.

The cloud offers countless benefits.

A few years ago, companies were hesitant to embrace cloud computing. Some saw it as a risk; others feared it would be disruptive to their business. But now, the cloud is widely accepted as a transformative force that is here to stay. Its benefits are numerous, from lowered costs to increased flexibility and scalability. As a result, the cloud is no longer a question of if but how for businesses.

With the high pace of innovation today, many people are thinking about the cloud from the outset. However, this is no longer an issue with the advancements in cloud technology. For example, thanks to its flawless DevOps operations, Amazon can deploy code every 11-12 seconds, resulting in an ever-growing list of services for customers. But, of course, this is impossible for most organizations with their on-premise servers.

On-premise: the right choice for some

On-premise systems are still a viable option for many businesses. They offer a high degree of control and security and can be customized to meet the organization’s specific needs.

Speed

Moving to the cloud can offer many benefits for companies, including getting rid of operational hassles. However, it’s important to note that this also requires accepting the technical framework provided by the cloud provider.
This can pose a problem for legacy systems, as moving them to the cloud can be more expensive (e.g., due to rewriting code) than maintaining a local data center to run them.
Cloud services can sometimes be slower than accessing local servers due to latency. Generally speaking, local servers will be faster with fewer potential sources of error in the network traffic. Also, if the data never leaves the building, a lower bandwidth will suffice.

Terms and Conditions

Few people have the opportunity to negotiate individual terms and conditions with global service providers as a customer. However, if there are service issues or the provider believes the customer has violated contract terms, they can request the customer to leave.
Yet, in some cases, customers have the option to establish a data center, either on their own premises or those of a partner/affiliate, to run their IT services. This becomes a critical negotiation point when incumbent providers try to restrain customers’ access to their infrastructure due to security or performance concerns.

Tech Support

In addition, internal IT teams typically have faster response times than service providers. Service providers can be more difficult to contact when trying to resolve an issue, contributing to longer response times.

Security

In the cloud, you have to accept that you have neighbors. There are good and bad neighbors in cyberspace, just like in real life. Unfortunately, neighbors can also be malicious. We’re not just referring to the countless hackers using global cloud services as a back-end infrastructure but also to vulnerabilities like the Row hammer, or Rowhammer, which is a type of security risk that affects sharing the same hardware between multiple users. Although on the other hand, protecting the security of your in-house servers is no easy task, but with the right IT team is doable.

Cost

What are the costs associated with each option? From a business point of view, the cloud may be preferable, as it generally requires less up-front investment. However, it is essential to consider all factors before making a decision.

Hardware cost:
The latest hardware is always the most expensive. It’s a luxury to have devices that can handle highly fluctuating workloads, and the cloud is much better at scaling up and down. However, an on-premise setup makes more sense if you have a predictable and consistent performance demand that can be satisfied with older (cheaper) hardware.

Cost of migration:
The cloud offers many advantages in reducing the costs of server management and operations, but that doesn’t mean migrating to the cloud will automatically save you money. You have to do your homework and ensure that your cloud deployment will save enough money to be worth the cost of the migration itself.

Conclusion

It is unlikely that either a dedicated data center or the cloud will provide a satisfactory solution on its own; instead, it is worth considering a mix of the two.
When calculating costs, always consider that on-premise requires a team of IT experts. The cloud, meanwhile, requires much less hands-on management but comes with monthly subscription costs. Combining the two can lower both sets of expenses while also providing your users’ reliability and performance.