Cloud or On Premise. A Cost Comparison

As I talk to more companies about Cloud computing and the ways they can benefit, sooner or later the subject of cost crops up. Obviously the monthly subscription is an ongoing cost, but when comparing the cost many companies only look at the hardware and software costs they would incur if they went on premise. Actually there are lots of extra costs that can mount up, one of my favourite slides I have been using lately when discussing this with customers is the Iceberg one (see below)  All the legitimate extra costs that sometimes get forgotten when pricing up an upgrade to a new system or software package. Also take into consideration that you will probably repeat the network upgrade every 4-5 years, so these costs mount up.

With the cloud you have a consistent per user per month cost, allowing for proper budgeting and visibility when adding users to the system. You also lose the responsibility for keeping these systems running as they are now off site.


I’m not claiming that Cloud is the only option to go, not at all. However when comparisons are being made between the 2 its only fair to consider all the costs.

In fact we are about to announce a package where we can offer the best of both solutions, a server running Windows Server 2008 R2 on premise, where all your files are stored, but your Exchange Mailboxes are in the cloud at Technology Management’s hosting centre, your files will also be backed up to the data centre each night as well. So no on premise Exchange licence/install or running costs, your data backed up off site and all accessible wherever you want to work as long as you have an internet connection. I’ll post the full details up in the coming days… If you currently use Microsoft Small Business Server this is a great alternative but on the latest Microsoft Software with out all the upfront costs.


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