On-premise vs cloud – the best of both worlds?

On-premise vs cloud – the best of both worlds?

Over the last 10 years, the world of enterprise IT has been outspoken about how cloud services  make mainframe and on-premise software redundant. Yet, here we are in the next decade, and legacy applications are still around, in fact, buzzwords like hybrid cloud seem to be dominating enterprise tech conversations. So it might still be worth taking an objective look at the advantages of on-premise vs cloud, to see if there is a solution providing the best of both worlds.

Is the cloud more reliable than on-premise solutions?

Well, it depends. Let’s use an analogy to address  this question in a more tangible way:

What would be  more reliable for your commute to work: owning and maintaining  your own  car, or carpooling? The former would come out on top, when you drove frequently and had enough money for parking and getting your car fixed. The latter would  be preferable, if you considered yourself a terrible driver and you only travel once a month anyway. In this case, s carpool driver who drives every day has more experience and can keep you safer on the road. But then it’s all about trust, right?

Cloud vs on-premise comparison

Replacing file servers with cloud is a struggle. Yet, as technology has matured, more and more businesses have started leveraging the benefits of the cloud. Contrary to file servers, the cloud offers easy scalability, enhanced mobility and collaboration between offices at a fraction of on-premise costs. Yet, when it comes to storing their most confidential files in a secure manner, many organizations decide to keep these files on-premise (in many cases on a traditional file server) - even though this means making significant sacrifices.

Let’s look at the pros and cons of on-premise solutions:

Advantages of on-premise

  • Control: You retain all control over your environment and data. If the required IT expertise and manpower are available, you’ll be safe and efficient as you can be.
  • Customization: Everything being built and configured  to your specific needs is the best benefit of on-premise. Cloud services offer you standardized mainstream products.
  • Security: Businesses storing and processing sensitive business and personal information on behalf of  their employees or customers, such as government agencies and businesses in the  banking industry, must offer high-level security and privacy. An on-premise solution can provide this in a better way.
  • Internal network: Having a local internal network -  provided that it is configured and operated properly - will make for a reliable business operation experience. Crucial data will always be accessible, and you are not reliable on the internet.
  • Lower internet cost: It may  be that your core business does not rely that much on the internet - in this case, you can cut the internet cost that cloud-based services entail.

Drawbacks of on-premise

  • File sharing between offices is challenging: Offices located in different locations/countries might not have the adequate means for file storage or a reliable connection, so data availability can suffer a big deal.
  • High maintenance cost: High utility bills, manpower costs, training expenses, keeping up to date with technology, licenses, and expanding hardware are all huge financial undertakings and therefore the most significant drawback of on-premise.
  • Lack of mobility: In case of a disaster or the wish  to operate in other countries, the building of additional sites and moving data is cumbersome. Employees might not be able to access data from different types of devices.
  • Lack of administrative control: Lacking a consolidated environment across many locations, and missing a central management interface for monitoring, logging, and managing user rights can lead to serious security flaws.

To have a better understanding of both storage methods, we’ve also collected the advantages and disadvantaged of cloud solutions:

Benefits of the cloud

  • Cost: With pay as you go subscriptions, there are options to only pay for what capacities you use and only when you are using them. The unbeatable cloud advantage.
  • Accessibility: Cloud services can be accessed from the internet by any type of device (laptop, phone, tablet)
  • Business continuity and disaster recovery: Having a second backup “datacenter” in the cloud could spare your business from major service disruptions.
  • Speed: Deploying any kind of IT service into operation will be much faster by leveraging cloud services.
  • Up-to-date technology: By using cloud services, you no longer need to invest into new technology and developments. Service providers need to keep up with new requirements.
  • Mobility: Deploy a new site in any country when you want to expand business. Scale up your server capacity within minutes. Make data accessible anywhere in the world.
  • Analytics: Cloud services can provide you with a holistic view on your environment, by generating  reports, and analytics, and monitoring  users’ behavior.

Drawbacks of cloud-based software

  • Security vulnerabilities: Cloud services are shared by many customers “competing” for the same underlying hardware. Your data can literally be anywhere in the world and cloud providers are also honeypots for hackers.
  • Compliance: Cloud providers might not have the required security means to satisfy regulations like the GDPR, HIPAA, FINRA or TISAX.
  • Increasing costs: Cloud services are consumption models, thus when left unmanaged, monthly invoices can suddenly peak.
  • Connection: Most cloud services are provided through the internet, which makes you reliant on the your internet provider’s quality of service.
  • Migration: Migrating to the cloud is a complex undertaking, depending on the components you want to move. You employees will need to be trained in using the new interface.

Cloud vs on-premise security

The question arises whether the cloud is more secure than on-premise? As mentioned before, this is highly dependent on many factors that play into different security levels:

Cloud server security:

  • By nature, cloud providers have to keep up to date with technology, are obligated to use the latest software versions, and require the signing of  demanding SLAs from  their customers. This ensures better cloud server security.
  • Redundant, mirrored datacenters guarantee  that data is backed up in several locations, thus ensuring business continuity in case of a disaster, or service unavailability.
  • Cloud providers make their living from  operating complex IT infrastructures. They encounter varied problems on a daily basis and have a vast database of known errors  and possible  workarounds. Not many individual businesses have such experienced workforce and extensive IT knowledge.
  • Cloud services are based on virtualization technology, which ensures that pre-hardened server images are being used. Instead of fixing these, they can just be restarted, without interruption. Micro-segmentation of coherent IT components can ensure better visibility and containment of viruses.

On-premise security:

  • Since they are serving many customers, cloud services are most susceptible to DDOS and hacking attempts, because valuable loot is almost guaranteed. A small to mid-sized business is less likely to draw this kind of attention from malicious actors.
  • With cloud service, your data travels a lot from virtual machine to virtual machine all over the world. Data is most vulnerable during transit. On-premise security is in the better position to  ensure that data stays encrypted and at rest.
  • If your company leverages the latest technology and invests into IT experts who can build a reliable and robust, standardized IT infrastructure, then the security of your data will be unmatched compared to other  cloud providers. This, however, requires  a lot of money and effort.

Cloud computing vs on premise cost comparison

In the long run, what will be more expensive, a cloud or on-premise solution? First of all, we need to understand that having an on-premise datacenter is dependent on capital expenditures (CAPEX) and a cloud service requires operational expenditures (OPEX). Both could increase  if the solutions implemented do not meet business goals and are not planned and managed according to actual business needs. When done well, overall OPEX can be kept lower with cloud services.

Capital expenditures for an on-premise datacenter are related to:

  • building a datacenter site, special rooms for servers (air conditioning, fire safety), physical security via entry system, monitoring, guards etc.
  • purchasing assets: server cages, server hardware, spare parts, cabling, licenses, software, hiring IT professionals.
  • cost of maintaining all assets, insurance, upgrades, monthly payrolls, training personnel tied to asset use.
  • Hidden costs: downtime hours cost for business, disaster recovery/failover

Just to look at some numbers: Over a 3-year server and 15-year infrastructure amortization, on-premise server hardware costs will dominate your monthly IT budget with around 57%. Second on this list with an overall 31% of the total cost of IT infrastructure will be the cost of power consumed and the cost of both the cooling and power distribution to servers.

Cost benefits of cloud computing

By deploying and maintaining an on-premise storage infrastructure, you are investing in advance into what you think your business is going to require constantly. However, requirements fluctuate over the year, and over time you might need to down- or upscale permanently. These decisions can have grave consequences for the total cost of ownership of an on-premise solution.

Most of your IT expenses will refer  to servers and their power consumption. With cloud solutions, the number of servers can be better tailored to seasonal workload fluctuation in a financial year. If managed well, your total cost of ownership of the cloud will significantly be less than for the on-premise solution. In sddition to the subscription fees,  the implementation of the cloud solution into your business, the customization and the training of your employees will also entail costs. Apart from that, costs included in data recovery need to be considered as well.

One solution to address all requirements

Tresorit provides trusted methods to counter all the drawbacks of cloud solutions by protecting your company data with zero-knowledge end-to-end encryption. Our technology ensures that every file gets encrypted on your device, nothing leaves unencrypted. Thus we protect your data along its entire transmission path from the user’s device to the recipient. Tresorit’s client-side encryption means that the encryption keys are available only for you and your authorized recipients, therefore nobody else can decrypt and read the files, not even Tresorit. Thanks to our reporting and monitoring capabilities, you can benefit from enhanced transparency and auditability, and regain control over your data.

With team- and file-level access permissions available in Tresorit, you can also mitigate one of the biggest security risks for both on-premise and cloud solutions: human error. Hacker attempts can  be rendered harmless, as indecipherable data will be of no value to them and cannot be used to extort ransom. Tresorit offers cloud benefits in the smartest and safest way possible so you can benefit from transforming CAPEX into OPEX.

Are you interested in reliable cloud solutions that combine security and convenience? Visit our offerings for security-conscious businesses.