Cloud vs onpremises for Businesses

In recent years, the management of records by enterprises has evolved strikingly due to the rapid data growth, and the necessity to handle the data safer and for a longer period also kicked in. Building, planning, operating, and managing information management infrastructure has become indispensable to businesses irrespective of their scale. It is important for enterprises to store the data carefully and to follow appropriate regulations imposed by the respective nation. According to research, careless data handling or losing data can lead to severe repercussions such as monetary loss, damage to the brand's reputation, and loss of everyone's trust. Therefore, organizations must have reliable security systems in situ which can secure and back up the data.

Popularly, organizations store their data on-premises (the traditional way of storing data) or in the cloud. Most companies start with a low-budget storage solution, and they scale up when they grow as an organization. There are multiple ways in which you can store your organization's data. However, to design data storage infrastructure for your business, you should know which one meets your organization's needs and which doesn't. After analyzing current and emerging market technologies, you can plan and decide on a storage infrastructure that will allow your business to meet existing demands. Likewise, it should be convenient for you to shift to future technologies when your business grows.

In this article, the concept of traditional storage and cloud storage and their differences are discussed. You will also understand the reasons/factors behind the transition from on-premises storage to cloud storage.

 

What is on-premises storage?

On-premises storage refers to IT infrastructure that is hosted physically within the organization's setup and connects different users in the organization. In other words, traditional storage refers to the usage of local physical drives to store data at the primary location of the business. Many companies prefer on-premises storage solutions over off-premises because it doesn't require third-party access and the full user control lies within the company. Moreover, highly regulated organizations whose top priority is privacy would favor setting up an on-premises storage infrastructure.

 

What is cloud storage?

Cloud storage is a virtualized storage infrastructure where data is transmitted through the internet and stored in servers. Therefore, the data can be accessed from anywhere and it can be easily adjusted to meet the dynamic workload expectations. In other words, it is a service model in which data is backed up, managed, and accessed remotely through a network like the internet. Cloud storage offers to create a large pool of resources in which the computing systems of an organization are not treated as a set of independent environments that each must be managed. Hence, this model allows access to each other's data in the organization which will encourage a collaborative working style instead of individual work.

In general, cloud storage is used by businesses for data backup, disaster recovery, archiving, and DevOps projects. There are three main cloud-based storage architecture models:

  • Public
  • Private
  • Hybrid

 

Discovering the Business Compatibilities in On-premises and Cloud Model

Many organizations feel that the cloud model provides a more efficient and cost-effective IT service delivery. Before concluding, we must know how these models behave in different situations. Therefore, let us clearly understand how the on-premises model performs differently compared to the cloud model in various factors mentioned below:

 

1. Costs and Maintenance

Setting up a storage infrastructure for your organization will involve costs and maintenance. For example, you might think about adding a new application or increasing storage capabilities or be it any business decision. In every case, costs and maintenance are involved, and not every time the business decision will align with the inexpensive solution.

ON-PREMISES

The on-premises arrangement needs significant capital investment to set up space, servers, equipment, power, and others. For deploying the traditional infrastructure model, the organizations need to invest a sizeable capital in hardware, installation, software licensing fees for the IT service providers, data backup, additional IT services, support, and more. Since it has privately owned and controlled facilities inside the organization, an investment to set up a dedicated tech support team is necessary to manage the support, maintenance, and security of the on-premises arrangement. In addition, the organization must plan its additional expenditure for software and licensing updates, upgradation of hardware, or any new equipment.

CLOUD

One of the biggest advantages compared to the traditional storage model is that the cloud model doesn't require sizeable capital investment. In the cloud storage model, the organizations pay for the capacity only for what has been used. Therefore, the more data you have, the more you will have to pay to keep it stored in the cloud and vice-versa. The cloud model is considered a model that delivers IT resources in a manner that provides self-service, on-demand, and pay-per-use consumption.

In this model, the cloud provider bears responsibility for the maintenance and protection of the data. This feature of this model helps the organization to hand over the tasks associated with storage such as procurement, installation, administration, and maintenance to service providers instead of setting up a dedicated IT support team in the organization.

 

2. Security/threat protection

Irrespective of the data center set-up chosen by the organization, the matter of security is always a concern. This being the situation, many organizations choose the traditional model of storage simply because the physical storage hardware is inside the premises of the organization. So, can it be concluded that the on-premises model ensures more security over cloud data centers? Let's discuss these two models more elaborately from the security perspective.

ON-PREMISES

If you are an organization that handles sensitive information and security is pivotal to the functioning of the business, in that case, an on-premises setup will meet the security, compliance, and performance requirements of your organization. In this model, the responsibility of data security wholly lies in the hands of the experts inside the organization, and in the case of the cloud model, global cybersecurity experts safeguard data and assets around the clock.

CLOUD

If an organization chooses to opt for the cloud model, it should know where the data is stored physically by the hosting cloud services provider. In a report that ranked the safest countries to store data, Switzerland and Singapore ranked at the top indicating that the data stored in these countries are least likely to be at risk. However, many organizations prefer to store their data within the nation rather than in foreign countries. Especially, in this model security breaches have occurred causing distress to the users. Therefore, organizations must choose their service providers wisely who have enhanced their security capabilities with data encryption, multifactor authentication (MFA), data storage in multiple locations, and improved physical security.

Globally, the cloud storage of corporate data in organizations has increased from 50% in 2021 to 60% in 2022. This share was 30% in 2015 and has pursued to grow. The increase in the percentage indicates a shift in resources to cloud environments in the expectation of improving security and reliability besides advancing business agility.

Image removed.

Source – Statista

 

3. Compliance

Before deciding on the storage infrastructure, the organizations should check if the data center setup can protect sensitive data and the level of compliance of service providers. Let's see how the on-premises model differs from the cloud model in terms of compliance.

ON-PREMISES

In the case of on-premises infrastructure, you should ensure to properly configure and maintain your systems to adhere to data governing policies and compliance regulations. If something goes wrong, the responsibility falls 100% on your business, as you own the servers and data centers inside your premises. If you don't follow appropriate compliance regulations, it might cost a bomb.

CLOUD

Unlike an on-premises model, a top cloud service provider has teams of experts who have compliance certifications in dozens of relevant key industries, including health, government, finance, education, manufacturing, and media. Also, this model can be inexpensive compared to the on-premises model in setting up a storage infrastructure following appropriate compliance regulations.

 

4. Scalability

When you plan to scale up your business which model you would like to choose? To decide, know how they differ from each other.

ON-PREMISES

If the existing on-premises setup can no longer meet the dynamic workload, you might want to add new computing resources like hardware, and software. If the requirement is short-lived, the cost spent will be highly inefficient.

CLOUD

Since cloud providers charge you based on the pay-per-use consumption model, the organizations can smoothly and efficiently scale to handle to expanding nature of the business. Therefore, it is a more cost-effective model which eases the businesses to scale up, down, out, in, and even auto-scale depending upon the evolving demands.

 

5. Reliability

Investigating the reliability and viability of a data center is one of the most complex areas to be focused on while offering a good user experience. Here are certain things related to on-premises and cloud that need to be considered by you when it comes to reliability.

ON-PREMISES

This type of arrangement is suitable for businesses that don't require an internet connection for onsite employees to access storage. The data can be accessed fully without a good connection. Therefore, it has a limitation for remote employees and this setup requires power, backup power, and a storage backup system which will hike your costs.

CLOUD

In the case of the cloud storage model, a good, fast, reliable internet connection is pivotal. One of the concerns in this model is delays in data transmission to and from the cloud, i.e., latency. This issue is common when organizations use public internet connections which can cause traffic congestion. However, organizations can curtail latency by increasing connection bandwidth.

 

6. Data Backup

Data backup is as important as security and organizations have to regularly backup their data to prevent any pauses in business activities if the data is lost due to cyber-attacks, natural disasters, or

human error. Evidently, there are some differences in which these two models take backup of the data - let's see how!

ON-PREMISES

In this model, the data is stored in the servers present inside the organization. In case of data loss risk, the company assumes whole responsibility. According to a report, 80% of organizations that use traditional servers make use of the cloud as part of their data protection strategy.

CLOUD

Cloud data backup is advantageous because it is cost-effective, scalable, and easily accessible. This model supports automated backups which allow the organizations to decide how often to back up the data. A survey says that 92% of companies already have a multi-cloud strategy where the organizations switch to a functioning backup for disaster recovery if one of the services is not available for some reason.

 

7. Anywhere access

In a situation where remote work is on the rise, let's consider these two models before picking the right one for your organization in terms of anywhere access.

ON-PREMISES

If all your employees work on the same premises and in the case where remote access is not required, this model can be preferred. Or choose the on-premises option if you could afford a private cloud setup to enable remote access.

CLOUD

Cloud storage is typically available from any system, anywhere, and at any time and can be accessed from anywhere anytime. The users need not bother about operating system capabilities.

According to remote work statistics, nearly 34 percent of workers prefer to work in the cloud and will look for a new job if they are required to return to the office.

 

Conclusion

It is evident that the cloud can knock out the shortcomings in the traditional computing model, which includes space, time, power, and cost. However, from the above discussion, it cannot be concluded that cloud computing has emerged as a replacement for an on-premises data center model. Moreover, it is tough to deduce which is the best depending on the pros and cons. It is way more complicated to decide what can work best. It is better to appreciate the cloud for business agility and economic reasons rather than to consider it as a substitution for the traditional data center.

To utilize the best of the two models, you can adopt a hybrid model where you can keep your LOB (Line of Business) applications/software on-premises and have the rest in the cloud. This way you can embrace both the public cloud and local data that can improve your IT agility and maximize efficiency.

Furthermore, it can't be denied that the cloud has become an increasingly preferred option for organizations thereby laying the foundation for the industrialization of computing. According to an

estimate, the amount of data stored on cloud servers will be over 100 zettabytes (billion terabytes or a trillion gigabytes) by 2025. This shows the exponential pace of cloud adoption among various players in different industries.

Category

Cloud Vs On-premises for Businesses

 11

In recent years, the management of records by enterprises has evolved strikingly due to the rapid data growth, and the necessity to handle the data safer and for a longer period also kicked in. Building, planning, operating, and managing information management infrastructure has become indispensable to businesses irrespective of their scale. It is important for enterprises to store the data carefully and to follow appropriate regulations imposed by the respective nation. According to research, careless data handling or losing data can lead to severe repercussions such as monetary loss, damage to the brand's reputation, and loss of everyone's trust. Therefore, organizations must have reliable security systems in situ which can secure and back up the data.

Popularly, organizations store their data on-premises (the traditional way of storing data) or in the cloud. Most companies start with a low-budget storage solution, and they scale up when they grow as an organization. There are multiple ways in which you can store your organization's data. However, to design data storage infrastructure for your business, you should know which one meets your organization's needs and which doesn't. After analyzing current and emerging market technologies, you can plan and decide on a storage infrastructure that will allow your business to meet existing demands. Likewise, it should be convenient for you to shift to future technologies when your business grows.

In this article, the concept of traditional storage and cloud storage and their differences are discussed. You will also understand the reasons/factors behind the transition from on-premises storage to cloud storage.

 

What is on-premises storage?

On-premises storage refers to IT infrastructure that is hosted physically within the organization's setup and connects different users in the organization. In other words, traditional storage refers to the usage of local physical drives to store data at the primary location of the business. Many companies prefer on-premises storage solutions over off-premises because it doesn't require third-party access and the full user control lies within the company. Moreover, highly regulated organizations whose top priority is privacy would favor setting up an on-premises storage infrastructure.

 

What is cloud storage?

Cloud storage is a virtualized storage infrastructure where data is transmitted through the internet and stored in servers. Therefore, the data can be accessed from anywhere and it can be easily adjusted to meet the dynamic workload expectations. In other words, it is a service model in which data is backed up, managed, and accessed remotely through a network like the internet. Cloud storage offers to create a large pool of resources in which the computing systems of an organization are not treated as a set of independent environments that each must be managed. Hence, this model allows access to each other's data in the organization which will encourage a collaborative working style instead of individual work.

In general, cloud storage is used by businesses for data backup, disaster recovery, archiving, and DevOps projects. There are three main cloud-based storage architecture models:

  • Public
  • Private
  • Hybrid

 

Discovering the Business Compatibilities in On-premises and Cloud Model

Many organizations feel that the cloud model provides a more efficient and cost-effective IT service delivery. Before concluding, we must know how these models behave in different situations. Therefore, let us clearly understand how the on-premises model performs differently compared to the cloud model in various factors mentioned below:

 

1. Costs and Maintenance

Setting up a storage infrastructure for your organization will involve costs and maintenance. For example, you might think about adding a new application or increasing storage capabilities or be it any business decision. In every case, costs and maintenance are involved, and not every time the business decision will align with the inexpensive solution.

ON-PREMISES

The on-premises arrangement needs significant capital investment to set up space, servers, equipment, power, and others. For deploying the traditional infrastructure model, the organizations need to invest a sizeable capital in hardware, installation, software licensing fees for the IT service providers, data backup, additional IT services, support, and more. Since it has privately owned and controlled facilities inside the organization, an investment to set up a dedicated tech support team is necessary to manage the support, maintenance, and security of the on-premises arrangement. In addition, the organization must plan its additional expenditure for software and licensing updates, upgradation of hardware, or any new equipment.

CLOUD

One of the biggest advantages compared to the traditional storage model is that the cloud model doesn't require sizeable capital investment. In the cloud storage model, the organizations pay for the capacity only for what has been used. Therefore, the more data you have, the more you will have to pay to keep it stored in the cloud and vice-versa. The cloud model is considered a model that delivers IT resources in a manner that provides self-service, on-demand, and pay-per-use consumption.

In this model, the cloud provider bears responsibility for the maintenance and protection of the data. This feature of this model helps the organization to hand over the tasks associated with storage such as procurement, installation, administration, and maintenance to service providers instead of setting up a dedicated IT support team in the organization.

 

2. Security/threat protection

Irrespective of the data center set-up chosen by the organization, the matter of security is always a concern. This being the situation, many organizations choose the traditional model of storage simply because the physical storage hardware is inside the premises of the organization. So, can it be concluded that the on-premises model ensures more security over cloud data centers? Let's discuss these two models more elaborately from the security perspective.

ON-PREMISES

If you are an organization that handles sensitive information and security is pivotal to the functioning of the business, in that case, an on-premises setup will meet the security, compliance, and performance requirements of your organization. In this model, the responsibility of data security wholly lies in the hands of the experts inside the organization, and in the case of the cloud model, global cybersecurity experts safeguard data and assets around the clock.

CLOUD

If an organization chooses to opt for the cloud model, it should know where the data is stored physically by the hosting cloud services provider. In a report that ranked the safest countries to store data, Switzerland and Singapore ranked at the top indicating that the data stored in these countries are least likely to be at risk. However, many organizations prefer to store their data within the nation rather than in foreign countries. Especially, in this model security breaches have occurred causing distress to the users. Therefore, organizations must choose their service providers wisely who have enhanced their security capabilities with data encryption, multifactor authentication (MFA), data storage in multiple locations, and improved physical security.

Globally, the cloud storage of corporate data in organizations has increased from 50% in 2021 to 60% in 2022. This share was 30% in 2015 and has pursued to grow. The increase in the percentage indicates a shift in resources to cloud environments in the expectation of improving security and reliability besides advancing business agility.

Source – Statista

 

3. Compliance

Before deciding on the storage infrastructure, the organizations should check if the data center setup can protect sensitive data and the level of compliance of service providers. Let's see how the on-premises model differs from the cloud model in terms of compliance.

ON-PREMISES

In the case of on-premises infrastructure, you should ensure to properly configure and maintain your systems to adhere to data governing policies and compliance regulations. If something goes wrong, the responsibility falls 100% on your business, as you own the servers and data centers inside your premises. If you don't follow appropriate compliance regulations, it might cost a bomb.

CLOUD

Unlike an on-premises model, a top cloud service provider has teams of experts who have compliance certifications in dozens of relevant key industries, including health, government, finance, education, manufacturing, and media. Also, this model can be inexpensive compared to the on-premises model in setting up a storage infrastructure following appropriate compliance regulations.

 

4. Scalability

When you plan to scale up your business which model you would like to choose? To decide, know how they differ from each other.

ON-PREMISES

If the existing on-premises setup can no longer meet the dynamic workload, you might want to add new computing resources like hardware, and software. If the requirement is short-lived, the cost spent will be highly inefficient.

CLOUD

Since cloud providers charge you based on the pay-per-use consumption model, the organizations can smoothly and efficiently scale to handle to expanding nature of the business. Therefore, it is a more cost-effective model which eases the businesses to scale up, down, out, in, and even auto-scale depending upon the evolving demands.

 

5. Reliability

Investigating the reliability and viability of a data center is one of the most complex areas to be focused on while offering a good user experience. Here are certain things related to on-premises and cloud that need to be considered by you when it comes to reliability.

ON-PREMISES

This type of arrangement is suitable for businesses that don't require an internet connection for onsite employees to access storage. The data can be accessed fully without a good connection. Therefore, it has a limitation for remote employees and this setup requires power, backup power, and a storage backup system which will hike your costs.

CLOUD

In the case of the cloud storage model, a good, fast, reliable internet connection is pivotal. One of the concerns in this model is delays in data transmission to and from the cloud, i.e., latency. This issue is common when organizations use public internet connections which can cause traffic congestion. However, organizations can curtail latency by increasing connection bandwidth.

 

6. Data Backup

Data backup is as important as security and organizations have to regularly backup their data to prevent any pauses in business activities if the data is lost due to cyber-attacks, natural disasters, or

human error. Evidently, there are some differences in which these two models take backup of the data - let's see how!

ON-PREMISES

In this model, the data is stored in the servers present inside the organization. In case of data loss risk, the company assumes whole responsibility. According to a report, 80% of organizations that use traditional servers make use of the cloud as part of their data protection strategy.

CLOUD

Cloud data backup is advantageous because it is cost-effective, scalable, and easily accessible. This model supports automated backups which allow the organizations to decide how often to back up the data. A survey says that 92% of companies already have a multi-cloud strategy where the organizations switch to a functioning backup for disaster recovery if one of the services is not available for some reason.

 

7. Anywhere access

In a situation where remote work is on the rise, let's consider these two models before picking the right one for your organization in terms of anywhere access.

ON-PREMISES

If all your employees work on the same premises and in the case where remote access is not required, this model can be preferred. Or choose the on-premises option if you could afford a private cloud setup to enable remote access.

CLOUD

Cloud storage is typically available from any system, anywhere, and at any time and can be accessed from anywhere anytime. The users need not bother about operating system capabilities.

According to remote work statistics, nearly 34 percent of workers prefer to work in the cloud and will look for a new job if they are required to return to the office.

 

Conclusion

It is evident that the cloud can knock out the shortcomings in the traditional computing model, which includes space, time, power, and cost. However, from the above discussion, it cannot be concluded that cloud computing has emerged as a replacement for an on-premises data center model. Moreover, it is tough to deduce which is the best depending on the pros and cons. It is way more complicated to decide what can work best. It is better to appreciate the cloud for business agility and economic reasons rather than to consider it as a substitution for the traditional data center.

To utilize the best of the two models, you can adopt a hybrid model where you can keep your LOB (Line of Business) applications/software on-premises and have the rest in the cloud. This way you can embrace both the public cloud and local data that can improve your IT agility and maximize efficiency.

Furthermore, it can't be denied that the cloud has become an increasingly preferred option for organizations thereby laying the foundation for the industrialization of computing. According to an

estimate, the amount of data stored on cloud servers will be over 100 zettabytes (billion terabytes or a trillion gigabytes) by 2025. This shows the exponential pace of cloud adoption among various players in different industries.

Category : Technology

Let's build SOMETHING GREAT TOGETHER!