If You’re Considering Hosting Your Operation on Vendor Servers (AKA the Cloud), Ask Yourself These 5 Questions

Deciding between hosting information on an internal server or an external one (the cloud) can be difficult, even for technically savvy owners. Many factors make the decision personal and specific not only to each industry, but also to each company and office.

Internal hosting often carries a higher upfront price tag and capital expense, while external hosting will likely require monthly fees. With internal hosting, businesses can exhibit tighter control over the hosting environment. Running your own servers internally means you bear the responsibility for maintenance, consistent power, backups, cooling, and the space.

Hosting on vendor servers means you’ll be outsourcing many of the headaches. The hosting company is responsible for the data center, which frees up your employees for other responsibilities. The costs should be predictable, and a business can easily scale up when demand increases. Depending on your internet connection, cloud-hosted servers might slow down your operation, but you can upgrade your internet speed if it’s in your budget.

Although there are clear pros and cons of each, your own unique needs will ultimately dictate which solution is more appropriate for your business.

Finding the Right Fit 

Quite a few moving parts and variables could swing your decision to internal or external hosting. To make the best call, ask yourself the following questions:

  1. How long can you afford to be down?

There’s much more to operating a business than data, and there’s much more to a proper server backup than simply replicating your company’s data. In fact, backing up data is just the first step; copies of data won’t do you much good if your production environment goes down.

If downtime is particularly costly for your business and you want to create a more resilient system, hosting on vendor servers often allows you to have a virtual copy of your complete production environment, on standby, for a fraction of the cost. When environment A goes down, you can seamlessly switch to environment B without missing a beat.

  1. What are your staffing and support needs?

To be sure, you’ll need IT support to handle server maintenance. If all you need is a data backup — and you can afford the downtime while you recreate your production environment when it breaks down — you can probably handle things with in-house IT staff, standard backups, and minimal redundancy.

Generally, hosting on vendor servers will include dedicated, outsourced IT support, allowing you to focus on running your business instead of learning IT skills yourself or dedicating staff to server maintenance.

  1. How much do you want to spend?

Obviously, your costs will change depending on whether your server is kept in-house or is hosted by a vendor. In-house servers will require more upfront costs in staff, equipment, and maintenance.

Vendor servers will probably charge an all-encompassing monthly fee. But there’s another factor to keep in mind: the cost of internet speeds. Hosting on vendor servers can create a much more resilient and robust system; you’re effectively leasing the infrastructure of tech giants such as Amazon, Microsoft, or Google. Because these servers will be on a data center somewhere in the cloud, it’s possible that the internet connection you’re currently paying for won’t be enough to provide the performance you are used to on in-house servers. If you’re in a city with access to fiber optic internet connections, a fast connection should be affordable. You’ll also want to consider a backup internet connection, because that is now a single point of failure in connecting to your systems.

  1. What regulations apply?

In the financial services world, for example, industry requirements dictate that any electronic communications — even emails — must be retained for seven years. Other industries will have their own sets of retention requirements, so you’ll want to do some research to ensure that your system meets or exceeds these.

These requirements will affect the scope of your server needs, which could make a difference in your choice. If you need a lot of information stored for long periods, it might be best to rely on a vendor whose equipment will be higher-quality than what you could maintain in-house.

  1. Where are the people who need to access your data and systems?

A hosted server makes it easy to create changes across multiple locations and users. If your users are geographically distributed, they are a perfect fit for a hosted solution. If they all regularly go to the same building to work, internal systems are probably more efficient. If you have multiple offices, the decision can be driven by the complexity of which office needs access to what information, and you may wind up with a hybrid setup of some hosted and some internal servers.

Vendor-hosted servers have some substantial advantages, but that doesn’t mean they’re right for everyone. Ask yourself these five questions before you decide which solution is right for your own needs. If you’re still confused, don’t hesitate to give us a call.

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