In the world of software, there are two options for hosting an application: in the cloud or on-premises (on-prem). Cloud software is hosted off-site, in enterprise servers that companies pay a monthly fee to use. On-prem software is hosted on-site, in servers that a company purchases for themselves outright. Let’s take a closer look at both and see what the better option in 2023 is.
Cloud software includes things like Microsoft 365, QuickBooks Online, NetSuite ERP and more. These applications are hosted in enterprise-grade server farms, usually co-located (multiple instances of the same data saved in different locations) to prevent any downtime. Cloud software is usually easier to keep up to date (often automatic), offers the latest features, and provides better data resilience than most on-prem solutions. However, cloud hosting tends to be slightly more costly long-term, and requires an always-up internet connection.
On-prem software are applications hosted on servers that a company owns and keeps on-site. Examples include Microsoft Exchange, QuickBooks Pro, and Sage 100 ERP. On-prem servers can be accessed without a connection to the outside world, preventing downtime in the event of an internet outage. Companies also own the hardware (in most cases) and as such can sometimes have a greater level of control. However, on-prem servers require a large up-front capital expenditure, need on-going updates and maintenance, generally take longer to deploy, and do not provide the same resilience a cloud provider such as Amazon AWS or Microsoft 365 offers.
In 2023, we generally recommend companies look at cloud options, when feasible. Most locations have highly stable internet available, making the primary concern of cloud solutions – internet outages – largely a thing of the past. The predictable monthly cost of cloud solutions tends to be easier to budget for than large capital expenditures on servers, which do need to be replaced every 5-10 years. We also see stronger security options with many cloud solutions, especially concerning multi-factor authentication (MFA). MFA is one of the best ways to protect your employees’ accounts against hacking.
At Layered Systems, we’ve seen greater adoption of cloud solutions among our clients for years, and the trend is only getting stronger. The ease of use, installation, and maintenance makes cloud applications simpler for both your staff and your IT support. If your company is looking to make the move to the cloud, or if you’d like to discuss what options make the most sense for your business, Contact Us today.
