On-Prem vs. Cloud vs. Hybrid Data Centers: Which Is Best?

What you do with your data matters significantly to the effectiveness of your business. A decade ago, the choice was fairly simple: Companies stored and processed data in an on-premises data center. But the cloud was coming, and today, around 60% of corporate data is stored in the cloud, which has doubled since 2015. Now you can store data in an on-premises data center, entirely in the cloud or in a hybrid data center model. How can companies choose which of these options is right for them? This blog will help you decide.

What is an On-Premises Data Center?

There is no “chicken or the egg question” understanding which type of data storage model came first. On-premises data centers have been the traditional choice for organizations for as long as computing has been an option. With the on-premises data center model, businesses own and maintain their infrastructure, including servers, storage devices and networking equipment, at their company. This approach provides complete control and security over the infrastructure, allowing businesses to customize and optimize it to their specific needs. Organizations with strict data governance requirements or sensitive data often prefer on-premises data centers due to the increased level of control they offer.

One of the main advantages of on-premises data centers is reduced latency. Since the infrastructure is physically located within the organization’s premises, data can be accessed and processed quickly, leading to faster response times and improved performance. Another benefit is that on-premises data centers provide the control IT managers seek around data security and storage.

However, building and maintaining an on-premises data center can be a significant capital investment, requiring upfront costs for hardware, infrastructure and skilled IT staff. As cloud data centers rose to prominence, these on-premises data centers scaled back. One article suggests that on-premises data centers still exist in 54% of businesses. That number is steadily declining as public cloud usage increases. Even enterprise organizations, who have been traditionally skeptical of cloud models, have embraced third-party resources in one form or another these days.

What Are Cloud Data Centers?

The advent of cloud computing has revolutionized the IT industry. Cloud data centers, operated by third-party providers such as Amazon Web Services (AWS), Microsoft Azure and Google Cloud Platform, offer a range of services, including infrastructure as a service (IaaS), platform as a service (PaaS) and software as a service (SaaS). With cloud data centers, organizations can store and access their data and applications remotely via the provider’s infrastructure.

The cloud model brings numerous advantages. Scalability is a key benefit, as businesses can quickly scale their resources up or down according to their needs, paying only for what they use. Cloud data centers also provide high availability and reliability, with built-in redundancy and failover mechanisms that ensure minimal downtime. Additionally, the cloud offers global accessibility, enabling employees to access data and applications from anywhere with an internet connection.

Cost savings are another significant advantage of cloud data centers. Instead of investing in hardware and infrastructure, organizations pay for cloud services based on a subscription or pay-as-you-go model. Storing data in the cloud eliminates the need for upfront capital expenses for equipment, allowing businesses to focus budgets and staff time on their core competencies instead of managing complex IT infrastructures. Data security and privacy concerns remain key considerations when entrusting sensitive information to third-party cloud providers. However, Gartner says 99% of the cloud security incidents through 2025 will be the fault of customers, not the cloud provider.

What is a Hybrid Cloud Data Center?

Recognizing the benefits of both on-premises and cloud data centers, many organizations are adopting hybrid cloud models. This approach allows businesses to keep sensitive or critical data on-premises while utilizing the cloud for less sensitive workloads or burst capacity. Hybrid data centers combine the best of both worlds, leveraging on-premises infrastructure and cloud services to create a flexible and scalable IT environment.

hybrid data center model offers several advantages. It allows organizations to choose the most suitable platform for each workload, optimizing performance and cost efficiency. For instance, businesses can use on-premises infrastructure for highly regulated applications requiring strict compliance while utilizing the cloud for non-sensitive tasks or accommodating spikes in demand. The hybrid approach also provides resilience, as organizations can replicate critical data and applications across both on-premises and cloud environments.

However, managing a hybrid data center environment is increasingly complex. It requires expertise in integrating on-premises infrastructure with various cloud services and ensuring seamless data flow and security between the two environments. Businesses need to carefully plan and implement their hybrid strategy to avoid potential pitfalls and maximize the benefits of this approach. A third-party resource like Red River can help you manage these complexities.

On-Prem vs. Cloud vs. Hybrid—How Will You Decide?

Choosing between on-premises, cloud or hybrid data centers depends on an organization’s needs, resources and long-term goals. Today, 89% of companies use a multi-cloud approach to data management, but ultimately, the best choice will vary from one organization to another. Some may find that a purely on-premises or cloud-based solution suits their needs, while others may benefit from the flexibility and customization of a hybrid model. Regardless of the chosen approach, businesses must thoroughly evaluate their requirements, consider the trade-offs and align their data center strategy with their overall business objectives to make the most informed decision possible. Red River helps these businesses develop, design, deploy, and maintain their data storage infrastructures. Our managed services team can help your company handle the increasingly complex world of data. Talk with our experts today about what Red River can do for your company.

Q&A

What are the pros and cons of on-prem, cloud and hybrid data centers?

On-premises data centers offer complete control and reduced latency but require significant upfront investments. Cloud data centers provide scalability, cost savings and global accessibility but raise concerns about data security and reliance on third-party providers. Hybrid data centers combine the advantages of both models, offering flexibility and resilience, but necessitate careful planning and management. Ultimately, the best configuration depends on the needs, wants and priorities of each organization that uses these tools.

Is cloud data storage safe?

Cloud data storage can be safe if proper security measures are in place. Trusted cloud service providers employ some of the most stringent physical and cybersecurity measures to protect their clients. Encryption, two-factor authentication and other evolving security protocols make cloud storage a highly safe option for businesses. However, businesses must ensure proper configuration of their cloud-stored data use the rigorous access controls these cloud providers offer, along with updating and training end-users in best practices for security.