If you listen to all the industry press, you’d think everyone is moving to the cloud. It would certainly be easy to follow the herd, but is it right for you? I’m not going to give you any definitive answers here, since there are so many variables, but provide some food for thought. There are the usual considerations of the costs of in-house servers, software, and associated support costs. Even if you don’t have to hire (more) IT staff, how much is costing you for outside support? Often times, the real costs of doing things in house can be much higher than you realize.
On the other hand, doing things right in the cloud is not inexpensive. That can include high speed Internet at your end, redundant links and associated equipment, disaster recovery sites, replication, and so on. There can be as high or even higher IT staffing costs for all this. What does it cost you if your cloud resources are unavailable? There have been many high profile outages even with some of the largest providers. Then again, to be fair, how much downtime do you have a year with your in-house systems? People tend to forget their own systems aren’t up nearly 100%. Also, are you in an area where extended outages or storm damages at your office are possible?
There are a number of companies scaling back or reversing cloud projects due to rising costs. During evaluations, the consumption-based pricing looks very good, but when fully implemented pricing often rises dramatically.
Add to that, all the news of late regarding the NSA and other government activities, allegedly having backdoors or taps into many carriers and hosted services certainly give some pause for those with sensitive data. Certainly any of your data crossing the Internet has to be encrypted, but with the stories we are hearing that may not be enough anymore, at least if the government is your concern.
One of the first steps many make to the cloud is E-mail. That can make a lot of sense compared to the costs of in-house Exchange Server, anti-spam, and all else that goes with it. For small businesses especially, things like backup administration, security issues, patches and upgrades and such, are often badly neglected.
Another area that many small businesses are making the plunge is hosted PBXs. When faced with a forklift upgrade of a PBX or an office move, that is often the best time. You do need to shop carefully, and realize that you will still have much of the upfront costs of a new PBX, like all the handsets, possible new switches, routers, or firewalls to handle QoS and the requirements of SIP traffic, etc. Alternatively, when those costs are spread into the monthly fee you usually wind up overpaying in the long run. We’ve run five-year cost comparisons, and hosted comes out a lot higher than premise in most cases. It seems many go that route despite the questionable savings in a lot cases, but it deserves a look.
There’s the danger of a shake-out in the hosting market. When a large hosting provider went under they gave clients thirty days to move elsewhere – not much time at all for such a major undertaking but at least more time than if the provider just went dark.
All in all, moving to the cloud may very well be a smart move, but don’t do it just to be trendy. Do your homework and go in with your eyes open, being prepared to spend more than whatever you think you will.
If you decide to move anything to the cloud, we can assist with many of the pieces of the solution. Call us now to discuss a cost analysis for your business to see how much you would save.