Own server or cloud? A decision-making guide for businesses

Should we set up our own server or go to the cloud?" This is a question we regularly hear from our clients. The answer is not straightforward. It depends on the company size, data type, budget and other factors. In this article, we will review both options, including a hybrid solution, so you can make an informed decision.

On-premise server: Full control

Owning your own server means you have physical hardware in your premises or in a rented rack at a data centre. All data and applications run locally, under your full control.

Advantages of a dedicated server

Full control over data: Data never leave your premises. This may be important for legal or compliance reasons.
Predictable costs: After the initial investment, you pay only for electricity, cooling and maintenance. No surprises on your monthly bill.
Power output: For demanding applications (large databases, specialised software), a local server can be faster than the cloud.
Independence from the internet: Internal systems function even if the internet connection drops out.

Disadvantages of a private server

High initial investment: A quality corporate server costs 50 000-200 000 Kč and more. Add to that a UPS, a rack cabinet, and air conditioning.
Maintenance and management: The server requires regular updates, monitoring and component replacement. This takes time and costs money.
Outdated: The hardware has a lifespan of 4-6 years. After that, reinvestment is required.
Risk of breakdown: Lack of redundancy means a server failure halts work for the entire company.

Cloud: Flexibility and scalability

A cloud solution means your data and applications run on the provider's servers (Microsoft Azure, Google Cloud, AWS, or Czech alternatives such as Wedos, Master Internet). You pay a monthly fee based on consumption.

Advantages of the cloud

No initial investment: You do not need to purchase hardware. You pay monthly for what you use.
Scalability: Need more capacity? Add it within minutes. Reduce it when not required.
Availability from anywhere: Employees may work from the office, from home or while travelling.
Automatic backups and updates: The provider takes care of the hardware, updates and often backups as well.
High availability: Major providers guarantee availability of 99.9% and higher.

Disadvantages of the cloud

Ongoing costs: Monthly payments accumulate. Over 3-5 years, you may pay more than for your own server.
Internet dependency: Without an internet connection, you have no access to data and applications.
Limited inspection: The data are on third-party servers. This may be problematic in regulated sectors.
Vendor lock-in: Migrating from one provider to another can be complex and costly.

Hybrid solution: The best of both worlds

Most of our clients opt for a hybrid solution, combining local and cloud components. A typical example:

Email and cloud collaboration: Microsoft 365 or Google Workspace for email, documents and calendar.
Sensitive data locally: Secure systems, contracts and other sensitive documents on a local server or NAS.
Cloud deposits: Local data is backed up to the cloud for protection against physical disasters.

A hybrid approach gives you cloud flexibility where it makes sense and control of your own server where needed.

How to decide: Key questions

What is your budget? If you cannot invest tens of thousands of Kč in hardware at once, the cloud is a logical choice to get started.
Where do your people work? If employees are to work from anywhere, the cloud is simpler.
What data do you process? Regulated sectors (healthcare, finance) may have requirements regarding data location.
How reliable is your internet? In central Prague there is usually no problem, but it is still good to have a Plan B.
How fast are you growing? A rapidly growing company will appreciate cloud scalability.

Cost comparison: Example for 10 users

For a company with 10 employees, indicative monthly costs may look like this:

Own server: Initial investment 80 000-150 000 Kč, monthly management costs 3 000-8 000 Kč.
Fully cloud-based solution: 5,000-15,000 Kč monthly (Microsoft 365 + cloud server + backups).
Hybrid solution: Initial investment 30 000-60 000 Kč (NAS), monthly costs 3 000-8 000 Kč (cloud services + management).

The figures are indicative and depend on specific requirements. It is important to consider not only the monthly cost but also the expense of replacing the hardware after 4-6 years.

Summary

There is no universally correct answer. An own server makes sense for companies that need full control and have a budget for the initial investment. The cloud is ideal for companies seeking flexibility and low entry costs. A hybrid solution combines the advantages of both approaches and is today the most common choice for small and medium-sized enterprises.