On-Premise vs. Cloud Storage: Which is Best for You?

On-premise storage means that you use your own server hardware and software, likely stored in your building, to house your data. Cloud storage, on the other hand, resides in remote servers across town or across the country. Which option is best for your organization? Let’s look at the advantages and disadvantages of on-premise vs. cloud storage.

Initial Costs

On-premise data storage necessitates high startup costs. Each server will cost thousands of dollars, and you may need to hire a professional IT company to set it all up. Evaluating, purchasing and installing the equipment may also be time consuming: it may take months to fully integrate a new server.

The cloud, however, demands far less of an initial financial investment, and can typically be launched immediately.

The On-Premise vs. Cloud Initial Costs Winner? Cloud storage. Easy.

Extra Costs

On-premise costs are unpredictable, such as repair costs, which can be excessive. Systems also must be upgraded regularly and require regular maintenance. Some companies delay or avoid that regular maintenance which can eventually lead to operational downtime and loss of data.

On-premise storage costs also include:

  • Powering a single server, for instance, can cost over $1,000/year, per server.
  • The cost of ongoing depreciation, and server replacement can be substantial. Servers typically last for about six years, after which they may become obsolete and need to be replaced.
  • Mainframe equipment, for example, may need a full-time IT professional or a team to manage servers and troubleshoot.

Cloud storage providers, on the other hand, have a very different payment model. They charge by the amount of data you need stored, charging you a set fee every month, like a subscription. Generally, that will be your only cost, as the provider is responsible for upgrading its technology and installing the latest security protocols, upgrades and advances. The savings can be substantial: SherWeb conducted a study in which it found the average cost of an on-premise server was $1,476.31 per month, while the average cost of a cloud server was $313.90 per month. But, high storage needs means high fees. Organizations that need several Petabytes of data storage often find monthly cloud services costs are so high they’re prohibitive.

The On-Premise vs. Cloud Extra Costs Winner? Probably the cloud, but It depends on how much storage you need.

Scalability

On-premise scalability can be difficult. If your data storage demand grows, new equipment may need to be ordered, paid for, and installed before the storage can be used. When you include labor, testing and downtime while making the upgrades, the costs and time add up. If you need to reduce your storage, you’re still stuck with the same equipment.

With cloud storage, however, more storage means simply purchasing more storage space, which you can use immediately. You can also reduce your storage needs, and monthly fees, when you don’t need as much storage. However, you’ll want to check that storage amount every now and then. Many organizations tend to overbuy their cloud storage space. A 2017 report from RightScale showed that $900 million of cloud storage spend was wasted every year.

The On-Premise vs. Cloud Scalability Winner? Cloud storage, but only if you buy the right amount of storage.

Security

On-premise storage may be more secure, but not always. First of all, no storage is going to be 100% effective at keeping data safe. But local servers are less accessible to hackers than cloud storage (breaches across the cloud are regularly reported by the media). And a survey from Nexsan found that only 58% of IT professionals “considered access to files away from the office to be ‘private and secure’.” And when it came to sharing files outside of the business, only 3% did. Local servers are also at risk from fire, natural disaster and theft.

Cloud security, on the other hand, can be impressive. According to the Annual Cloud Computing Survey (2017), U.S. businesses using the cloud rank its security as a top benefit. And nearly 70% of U.S. businesses that use the cloud feel more comfortable storing data there than on a legacy system. Encryption and other security tools can go a long way to making cloud storage more secure.

The On-Premise vs Cloud Security Winner? Clearly, it depends on who you speak with, but if you use a trusted vendor, like Single Path, to set up and manage your cloud storage, you should feel confident your cloud storage is just as safe as keeping it local.

Accessibility

In 2017, 43% of Americans spent at least some of their time working remotely (According to the NY Times), and that number is rising. The ability to work off-site has been shown to increase productivity, operational efficiency and business agility.

For on-premise storage, however, accessibility is limited. Getting and sharing files can be slow and difficult.

With cloud computing, accessibility is a major advantage. Since data exists “in the cloud” any gadget connected to the Internet can access it, anywhere, at any time.

The On-Premise vs. Cloud Accessibility Winner? This is an easy one. Cloud computing.

The On-Premise vs. Cloud Storage Winner Can Be You

While cloud storage has many advantages in many areas, this doesn’t necessarily mean it’s right for you. While most small-to-midsize companies will find significant cost savings with cloud storage, others may find their exorbitant amount of data makes cloud storage too expensive. If you’re unsure, call us. At Single Path, we help clients navigate their server options every day, including helping them get on the cloud, secure their data, and modernize their systems. We provide Managed Cloud Services for many organizations, from businesses to school districts. So, which option, on-premise or cloud storage, is best for you? Call us and let’s find the best solution.