Skip to main content

The use of large volumes of data as a source for strategic decision making is motivating businesspeople and C-level professionals to consider larger investments in their technological infrastructure. But when they begin this process, a doubt arises: should they invest in a dedicated server or in a cloud database?  

For you not to have the same dilemma and make the right choice, we prepared this special article. Throughout the article we will show the difference between the two models of IT structure, and we will indicate what is the best strategy for the business. Enjoy the read!

What is a dedicated on-premises server?

Let us begin with the most traditional model of a company’s data infrastructure, which is part of the business reality since information technology became accessible.

Dedicated servers can be offered in a cloud model, but we are usually talking about the data center which is acquired and installed on-premises for internal and exclusive use by the business. In this case, IT oversees acquisition, installation, maintenance and usage in the physical space of the organization.

These servers are responsible for storing information and making data and systems available to the workstations through a network structure.

As they are part of the company’s assets, a large investment is necessary for their acquisition. Updates depend on planning from the board along with IT, who analyze the market needs as well as the current productivity performance, hardware warranties and lifetime and decide how and when to make new investments.

What is a cloud database?

A cloud database works with the same platforms and tools used by a dedicated infrastructure. The difference is that your business is not responsible for them. All resources are maintained by the cloud provider, which provides remote and secure access through the internet to service subscribers. In other words, Cloud Computing works in the Infrastructure as a Service (IaaS) model and the payment is made according to the use of resources.

In terms of productivity (the work terminals of the company’s employees), the use of tools and access to data remains the same. What changes is the location of servers and the management structure behind each of the modalities.

What is the best strategy?

We spoke about the difference between dedicated server and cloud databases. While in the first case the company pays for all the costs and responsibilities of the infrastructure, in the second the company uses a service offered by a technological partnership.

But in order to answer the main question of this conversation, we need a deeper analysis of what this difference means in practice. Here are the main points that may impact your business.


The first important aspect to take into consideration in this comparison is the physical space necessary to allocate both options within the company. When the focus is on optimization and cost reduction, every savings in resources means financial savings.

Taking that into consideration, there is a clear advantage for cloud databases. Physical servers not only take space and responsibility from the company, either in the office or in their own data centers or outsourced data centers, but there are also considerable expenses with energy, refrigeration and connectivity for them to work 24 hours a day. In Cloud Computing, the cloud service provider is responsible for these expenses and for maintaining a local data center


Information Security in servers and business systems will always depend on the capacity of the tools and on the specialization of the IT professionals. The difference is in the way you include these benefits in your business

If you own the infrastructure and it is on-premises, the company also needs to invest in people and in dedicated solutions to monitor the threats and protect data.

In cloud computing, chances of any hardware or software having their security threatened are very low, because the providers have several protocols to keep data safe

The main concern is to find a reputable partner. The provider is responsible for being up to date in relation to cybercrimes and for creating a secure network. Your IT team will be more focused on the practical and strategic use of technology.

Scalability and elasticity

We have already talked about physical space, how about talking about the space for your business data? Data based management requires the storage of a large volume of information – and this is related to the capacity of its servers to adapt to the demand. 

Dedicated servers are less flexible. The available space is not always compatible with the need, and any adjustment might take some time and demand a lot of effort from the IT team.

Cloud Computing offers a scalable and versatile model. It can be increased exponentially for great demands, and it can also shrink to reduce costs without having idle resources in the company.  


Both dedicated servers and cloud provided servers have a simple, safe and remote access system available. The difference is how this is made possible

When using your own servers, your IT team needs to deploy and maintain a secure connection for data and tools. When using cloud computing this is an essential service offered with the technological solution. In an increasingly Data-Driven market the easier the access to information, the better.

Exclusivity and customization

The question of exclusivity depends a lot on the deployment models, providers, and the capacity of the internal team. The dedicated servers have an advantage because they are built only for your business – even though they have a financial and operational cost

Cloud databases can be purchased in two ways: public and private clouds. In the private cloud the infrastructure is still remote and as a service but is designed exclusively for each client. It is a more expensive model, but an appealing one if you consider exclusivity

Even in the public cloud, where a provider shares resources from the data center with multiple customers, there is a complete logical separation between each bank. Depending on the plan, it is possible to have a customization level almost as significant as on dedicated servers.

Cost and maintenance

When talking about cost, Cloud Computing has gained a wide advantage over time. Technological evolution and the popularization of the model allow good providers to offer the state-of-the-art infrastructure with very affordable rates.

Thus, the investment is diluted in operational costs according per-use (OPEX) while the dedicated server usually requires a large financial contribution for the acquisition of an asset (CAPEX).

As the management, maintenance and upgrading of the server is the Cloud provider’s responsibility, you eliminate these expenses from your business. There is also more predictability, since you do not have to deal with infrastructure-related defects and emergency expenses

The truth is that when we analyze all these points, we still need to consider each company’s individual situation when looking to invest in technology. Different requirements and objectives can lead to different solutions.

But in general terms, the option of investing in a cloud database is increasingly attractive. With flexibility, scalability, cost reduction and availability, it becomes a more appropriate model for the digital market of the future.

If you liked this content and want to learn even more about technology, subscribe to our newsletter and be in the loop for all the trends in this segment!

BRQ fale conosco