Comparison at a Glance
| Criterion | On-Premise | Cloud |
|---|---|---|
| Initial Investment | High (hardware, licenses) | Low (pay-as-you-go) |
| Ongoing Costs | Predictable, often cheaper at scale | Variable, can get expensive with growth |
| Scalability | Limited, hardware procurement needed | Instant, elastic |
| Data Control | Full control, data in-house | With provider, trust needed |
| Compliance (GDPR) | Easier with sensitive data | EU cloud possible, but review needed |
| Maintenance Effort | High (own IT team needed) | Low (managed) |
| Availability | Self-responsible | SLAs up to 99.99% |
| Vendor Lock-in | Low | Risk with proprietary services |
| Disaster Recovery | Own solution needed | Often integrated, multi-region possible |
| Time-to-Market | Slower (procurement, setup) | Fast (minutes to hours) |
When On-Premise Makes Sense
- Strict compliance requirements – banking, healthcare, government with audit obligations
- Highly sensitive data – patient data, financial data, state secrets
- Existing infrastructure – data center available, IT team established
- Predictable, constant load – no scaling peaks
- Long-term cost optimization – often cheaper at large volume
When Cloud Makes Sense
- Fast time-to-market – startup, MVP, new products
- Variable or growing load – scaling as needed
- No dedicated IT team – managed services instead of self-management
- Global presence – multi-region deployment for international users
- Low initial investment – OpEx over CapEx preferred
The Hybrid Option
Many companies opt for a hybrid cloud strategy:
- Core database on-premise – sensitive data stays in-house
- Frontend and APIs in the cloud – scalability for end users
- Cloud bursting for peak loads – additional capacity on demand
- Disaster recovery in the cloud – backup site without a second own data center
Total Cost of Ownership (TCO)
The cost calculation is more complex than "cloud is cheaper":
On-Premise Costs
- • Hardware (servers, storage, network)
- • Software licenses (OS, database, etc.)
- • Power, cooling, floor space
- • IT personnel for maintenance
- • Spare parts, renewal every 3-5 years
Cloud Costs
- • Compute (CPU, RAM per hour)
- • Storage (per GB/month)
- • Data Transfer (egress fees!)
- • Managed Services (DB, cache, etc.)
- • Support plans
Rule of thumb: Cloud is cheaper at small scale and with variable requirements. On-premise becomes more economical from a certain size and with stable load.
On-Premise, Cloud, or Hybrid?
We analyze your requirements and recommend the optimal strategy – vendor-neutral and with a view to your long-term goals.