The Fight Between The Cloud & On-Premise Software

In this corner, weighing in at virtually nothing, is the cloud. In the opposing corner, weighing in at thousands of pounds, is on- premise software. Okay, okay, this may not be the fight you’re willing to pay $100 to watch on TV, however there  is always a debate about whether a company should use the cloud for storage or purchase on- premise software for inside their facility. I hate to spoil the ending of the fight, but despite the  extreme weight difference, the cloud is going to knock out the out-of-date and overweight on-premise software.

To begin the debate, let’s start off discussing why the Enterprise Content Management (ECM) is very well suited for the cloud. The trends that ECM lends itself to the cloud consist of content concentric applications, collaborative and sharing applications, and gives enterprise content access to a number of mobile devices. The access is permitted to all devices with internet capabilities such as smartphones, laptops, and tablets.

Along with the trends of ECM, the cloud has multiple advantages over on- premise software. One clear advantage is that the cloud has a significant lower amount of start-up cost and cost of ownership. Companies only pay for the amount of storage that they need in the cloud instead of purchasing tremendous amounts of servers to store their documents and files. Another advantage is that the cloud is extremely reliable and secure. The cloud will never damage or destroy the files and documents while the on- premise software can be manipulated and destroyed.

Taking a more in depth look at on- premise software, we realize why it doesn’t stand a chance against the almighty cloud. On average, $800 billion is spent by companies annually for purchasing and maintaining enterprise software while 80% of enterprise software expenditures are on installation and maintenance of software. As heavy as we know on- premise software is, a typical data center take up 100 times more per square feet than a typical office building. To put that into perspective, a “standard” facility is 9,000 sq. ft. and costs $21.3 million to build. Not to mention the $1 million in electricity costs In reality, the fight was over before the bell even rang. The costs of installing on- premise software is just the tip of the iceberg, and then the annual electricity and maintenance costs that follow are blasphemous. The cloud won this fight with ease because it never actually had competition.

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