One of the most important decisions a business must make is whether to store data and run applications on cloud-based servers or onsite servers. Each option has its advantages and trade-offs that will impact everything from operational efficiency and scalability to data security and long-term costs.
In this blog, we’ll break down the differences between cloud and onsite servers and help you determine which solution best fits your business.
Cloud Servers
Cloud servers are virtual servers hosted by third-party providers such as Microsoft Azure, Amazon Web Services, or Google Cloud. Like onsite servers, they store data and run applications to support multiple users, but over the internet.
Pros of Cloud Servers
- Scalable: Cloud servers allow businesses to easily increase storage capacity as they grow, without needing to purchase additional hardware.
- Lower upfront costs: Cloud-based servers operate on a subscription model, eliminating the need for large upfront investments in hardware.
- Accessible: Employees can easily access systems and data from any location with an internet connection, supporting remote and flexible work conditions.
- No maintenance: All hardware is handled by the cloud provider, reducing the workload from your internal IT team.
Cons of Cloud Servers
- Ongoing costs: Cloud servers require continuous payments, meaning depending on usage and scale, ongoing cloud costs may eventually exceed the total cost of owning and maintaining an onsite system.
- Internet-dependent: All cloud-based servers rely on an internet connection, so outages can disrupt access to your data and systems.
- Lack of control: Relying on a third-party provider to manage, update, and store your data can raise concerns about privacy, compliance, and long-term control.
- Data Sovereignty concerns: Some governments, including Denmark, France, and Germany, have raised concerns that U.S.-based providers like Microsoft could be forced by their government to restrict access to services abroad due to potential political fallouts. This has led to a growing shift toward digital sovereignty, where organisations and governments seek to store and manage sensitive data within their own jurisdiction to ensure uninterrupted access and compliance.
Onsite Servers
Onsite servers are physical machines located within your office or data centre. They provide full control over your data but come with higher setup and maintenance responsibilities.
Pros of Onsite Servers
- Fixed long-term costs: Once the hardware is purchased, there are no ongoing subscription fees.
- Location: Onsite servers offer peace of mind by keeping all critical data within your physical premises.
- Access: Since data and systems are maintained through the company’s local area network (LAN), staff can work uninterrupted during internet outages.
- Highly customisable: Onsite servers give businesses the ability to build a custom infrastructure to meet their own specific operational needs.
- Security: The company can fully manage the cybersecurity risks without opaque outsourcing arrangements.
Cons of Onsite Servers
- High upfront investment: Purchasing and setting up servers requires a significant financial investment.
- Maintenance: All maintenance and updates for the server will need to be managed by your IT team.
- Scalability limits: Expanding storage or performance capabilities requires purchasing and installing additional hardware.
- Space requirements: Physical servers need a dedicated room or secure space, which may not be feasible for all office environments.
- Energy consumption: Onsite servers require constant power and cooling, which can lead to high energy costs.
- Physical risks: Onsite servers are vulnerable to physical threats such as theft, fire, or water damage, which could result in data loss or downtime if not properly backed up.
Which is Best for Your Business?
Choosing between cloud-based and onsite servers will be determined on your business’s unique and specific needs. Cloud servers offer flexibility, scalability, and lower upfront costs. Onsite servers, on the other hand, provide full control, customisation, and independence from internet connectivity.
A trusted Managed Service Provider like Concord IT can assess your needs and recommend the best fit, helping you choose technology that supports your business now and into the future.
