This topic has been discussed many times and pros and cons analysed. Here are the 3 most important arguments, all from a small business’ point of view:
1. Data ownership / control – In the on demand model the data is on someone else’s servers. This might be scary for some businesses, especially when storing sensitive data. Read the small print and the SLAs to understand exactly what you’re getting into. Winner: On premises!
2. IT cost – With on premises, the IT cost includes not just licenses and support, but also wages for IT professionals to maintain it all. The cost also includes securing the data, maintaining & updating hardware, operating systems and so on. For a small company the on premises cost is generally prohibitive. With on demand, you pay monthly and the service company does it all for you, much cheaper than you can do it. You can focus on making money, rather than get bogged down in the IT quagmire. Winner: On demand!
3. Uptime – Having no access to your data when you need it is a scary prospect. With on demand, you are not in control of outages, so the perception is they’re much more damaging. But studies have shown that outages of SaaS services happen less often and last less than similar private, on premises, outages. Winner: On demand!