As cloud technology has expanded, it has become a much more accessible option for small and medium-sized businesses looking for simplified ways to store and access data. However, many businesses who are still using in-house servers may be wondering if it’s worth the switch to the cloud, whether it’s safe, and if it’s cost efficient.

We’ve outlined some of the main benefits of each data storage option to help you make the decision about which one is better for your business, including cost savings, flexibility, and more.

Cost Savings

Initially, cloud solutions were marketed under a cost structure that was much more cost-efficient than they are now. But as cloud solutions matured, so did its mechanisms to measure costs and establish turn-key rates. Because of this, a minimum infrastructure build for cloud solutions can still start at a low, affordable rate; however, you will not have as many workload options with such a minimum build. More complex builds will be more expensive.

That said, cloud solutions can be very beneficial for businesses who need to invest in short-term workload expansion tools to cover the influx—for example, switching to remote collaboration tools such as Zoom during the COVID-19 outbreak. Short-term licensing options and the lack of physical hardware purchases also make cloud solutions advantageous for these types of smaller workloads.

In-house servers can also present many cost benefits for businesses who have the flexibility to invest more in storage, higher processing power, or other technology resources up front. Additionally, with in-house servers, you own the hardware and software you purchase, whereas with cloud solutions, you pay perpetual monthly fees for service with no payoff and without ownership.

Further, long-term costs tend to be lower for less complex environments that are hosted onsite rather than in the cloud. Your OS costs are also reduced with long-term licenses, and some operating systems may even come free with the purchase of certain licenses, such as MS licenses. Depending on the projects you handle, your workload, and your business strategy, in-house servers can be a cost-effective option in the long run.


One benefit of in-house servers is that you have control over your data & backups allowing you to keep it all in-house, without third-party access. With that control, though, comes greater  maintenance costs and needs. In addition to initial costs in infrastructure and hardware, in-house servers require you to perform regular, sometimes expensive upgrades when equipment or software becomes outdated.

Cloud services, in comparison, usually only require you to make minor updates and upgrades because your services are being regularly supported by third-party experts. Your hosting company is responsible for general maintenance and their equipment upgrades.

So, depending on how sensitive your projects are and how much control you want to maintain over your data, you can gauge your willingness to invest in the additional maintenance in-house servers require.


In terms of flexibility, cloud solutions generally offer more options for backups and storage scaling than in-house servers. You can add storage as needed and only pay for what you need, as well as perform backups from anywhere, on most devices. There can, however, be limits to how much data you can actually store in the cloud, which can be disadvantageous to large businesses.

In-house servers can be more difficult to scale, if your infrastructure is ill-prepared for growth. Your infrastructure will likely be less flexible simply because it relies on physical equipment. However, perhaps one of the biggest benefits of in-house servers is that they do not rely on an Internet connection to access data. This flexibility may be beneficial to businesses who need to ensure data access at all times.


Cloud hosting companies generally have several security measures in place to protect your data in the cloud. Regular, frequent backups also ensure that data loss is less probable in the event of a disaster. That said, it’s important to work with a reliable provider for managed cloud services to ensure you are getting the protection you need. Giving a third-party access to your data can be a security concern if it isn’t handled appropriately.

For businesses who store highly sensitive data, it may make sense to maintain in-house servers to prevent using an Internet connection for data access. However, in-house servers require you to establish your own security measures and policies to protect your data, which can be risky if not done properly and often. Businesses who maintain in-house servers should take great care to establish advanced cybersecurity protocols.

Another security concern for in-house servers is that because of their location, your servers may be more susceptible to data loss in the event of an IT disaster or cyber attack. Data loss is even more probable for businesses whose data is frequently taken off-site. This is another reason that cybersecurity policies and procedures are critical for businesses with on-site servers.

As an overview, when it comes to cost savings, flexibility, maintenance, and security, both cloud storage solutions and in-house servers have their own unique benefits and drawbacks. Cloud solutions offer lower up-front costs and can provide greater flexibility and scalability for businesses. Conversely, in-house servers allow businesses to store large amounts of data and maintain control of that data, usually with reduced long-term costs.

As you determine what your needs are, you can establish the best data storage solution for your business.