Cloud vs. Data Center: What are the Differences?


January 8, 2022

“It’s in the cloud.” You’ve no doubt heard this phrase a lot in the past few years, but have you ever thought to ask what it meant? Although you might hear IT support providers lay out your service options as if there are two choices—cloud or data center—this isn’t exactly a paper-or-plastic situation. As usual with tech, there’s a lot more to it. Here’s what you need to know about the cloud, data centers and how the two relate to one another.

What exactly is the cloud, anyway?

Techies love to throw around buzzwords that are about as clear as mud to the average user. To further compound the confusion, “the cloud” refers to both a concept and the products that exist because of it, which is how terms like “cloud services” came into use. For instance, Google Drive and Microsoft Office 365 are two well-known cloud services that allow you to store and share files online, but they themselves are not the cloud.

When you’re a business owner or manager, you might need something more sophisticated than Drive and similar document storage and retrieval systems, which is where another type of cloud application comes into play. Although a wide range of products (online servers, hosted desktops, application and database hosting, hosted phone systems and more) fall under the umbrella of hosted services, they all have one thing in common: They’re hosted online, i.e. in the cloud. And once you log into an online platform to manage these tools, any data associated with them is stored online as well

Cloud computing, on the other hand, is considered more of a technological philosophy than a service. The idea is that in storing files and applications online instead of on your computer’s hard drive or your mobile device, you’ll need much less RAM or disk space on those devices to do your day-to-day work. Accessibility is another major benefit—with cloud computing, you can pull up files even if you don’t have a particular device on hand. What’s more, your programs and files are updated automatically to incorporate the latest improvements and changes; this means you’ll have less need for internal IT support, as does the fact that cloud services are scalable. Scalability is especially important from a server standpoint, as you can easily add or reduce disk space with minimal equipment costs.

What’s the deal with the cloud vs. data center debate?

Now that you have a better understanding of what makes the cloud so exciting to tech-minded folks, it’s easier to see why people tend to talk about the cloud as if it’s a mystical space in the heavens above. But it isn’t some wonderland free from the rules of physics—instead, it’s made possible with physical hardware and infrastructure that’s a lot like what you’d use to run an on-premise server or database.

In fact, almost any cloud service you’ve ever used is powered by a data center. Cloud data centers are usually huge, with many separate servers sharing the same physical space and running the virtualization software that makes it possible for you to access data via an online platform. The server storing that data may either be segmented and shared among businesses or used by your individual company alone—known as public and private cloud arrangements, respectively.

So, given the synergy between the cloud and the data center, why do people talk about the two as if they’re mortal enemies? Simply put, they’re comparing the cloud to a specific type of data center, the in-house kind that’s hosted on-premise and managed with an internal IT team or external MSP. In this scenario, all the physical hardware and infrastructure lives right in your office or at another leased space.

Although cloud acolytes may not have many positive things to say about on-premise data centers, the setup comes with its own benefits. You won’t share physical hardware with other users, thereby circumventing a potential risk to server security, and you’ll have complete control over and knowledge of who has credentials to get into your server. In some cases, on-site data centers can actually better serve high-demand applications or workloads that require little to no latency.

Cloud vs. data center – which side are you on?

There’s no one-size-fits-all response to the question of which side is best. The answer really depends on your needs and where you want to spend your money.

Cloud computing comes with obvious cost savings. Because equipment maintenance falls to your provider instead of your internal IT support team, you can scale back the latter to its most essential members. Additionally, as the cost of the equipment needed to support cloud computing is shared between many different customers, the cloud tends to be less expensive than on-premise databases.

That said, cloud computing is not the be-all and end-all for server management and storage—in fact, some business owners have found that the security risks outweigh the benefits. Moreover, cloud-only organizations often have to ramp up IT support to bolster data security, and businesses working with sensitive information (financial services companies, healthcare providers, etc.) may find that certain cloud iterations are not compliant with industry regulations.

The cloud vs. data center decision is not one to take lightly, and careful evaluation can be especially difficult when you’re wading through technical jargon. For a straightforward, plain-English research tool, download our Does Your Business Belong in the Cloud? e-book and never feel intimidated by IT support providers and their buzzwords again!

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