It’s not exactly news that running a web or application server in-house is an expensive proposition for any company, and especially for resource tight SMBs and startups. Hardware and software costs, hiring and/or training personnel to deploy and manage the server, and bandwidth are minimum requirements, and cutting corners in any of these areas courts disaster. Despite an intimidating high cost of entry, deploying an in-house server is still desirable for a number of reasons, most centered around security concerns or flexibility needs. Those advantages come with an element of risk, and businesses who don’t carefully consider the hidden costs in running a web or application server in-house could find any benefits negated in revenue draining budget shortfalls.
Hardware costs should be straightforward to identify, although deciding whether to purchase or lease is much less cut and dry. Purchasing hardware outright may cost less over time, but it also depreciates quickly and businesses can find themselves still paying off equipment that is losing performance ground to newer deployments. Leasing can offer more flexible options, but that typically comes at a premium price.
Software licenses can also be costly, and come with the added overhead of license management. Licensing can be an aggravating cost because unlike hardware purchases, you must renew software licenses, effectively paying multiple times for the same purchase. Likewise, responsible businesses must absorb the annual expenses of warranties and service contracts for upgrades and support.
The best hardware and software in the world is only as effective as the environment that supports it, and few businesses have the infrastructure it takes to provide full redundancy and bulletproof uptime. The cost of redundant power and network connectivity and 24-7 staffing are beyond the means of startups and SMBs navigating a tough economy, which means more cut corners and less reliability. Now the costs of deploying and operating an in-house web or application server are compounded by the lost revenues and productivity that come from increased downtime.
The intangible and unforeseen costs continue to add up, as in the case of higher insurance premiums to cover that capital infrastructure. Supporting systems like data backup and archival, security and virus protection, and hardware upgrade and replacement processes must also be included. Every one of these items not only increases the overall cost of delivery, but they also represent areas of compromise and budgetary limitations.
Here’s the unfortunate reality- most businesses that run their web and application servers in-house pay more and get less.
That’s why outsourcing to a managed hosting provider makes sense. SMBs get a much greater level of service at a fraction of the cost, and benefit from enterprise class systems and infrastructure that would be impossible to replicate in-house. Around the clock support, rapid deployments and upgrades, and a wide variety of complimentary services like load balancing, content delivery optimization, and flexible data storage and backup options make managed hosting even more compelling. Managed hosting turns the cost/benefit equation of in-house servers upside down, giving SMBs and startups much greater return on their investment.
Tags: Managed Dedicated Hosting, managed hosting, outsourcing hosting
