Hundreds of articles on the internet delve into the pros and cons of dedicated and cloud servers, but not many really come to the crux of the question. What is right for ME?

This question gets asked quite often to our server administrators, and we regularly help service providers choose between dedicated servers, private cloud and public cloud, depending on factors unique to their business.

Here we will discuss the most common factors that affect the choice of infrastructure.

1. Resource utilization trends

How much of the total CPU, memory, bandwidth or disk space is actually being used by your customers? In a pool of dedicated servers, some servers will have high utilization, while others would almost always be idle. If the majority of your servers are under utilized for most of the time, a cloud solution could save you money. A private cloud solution would be more suited for you if the bandwidth and disk space utilization is high (eg. through daily backups). However, if you are just starting out, a public cloud solution or a VPS would be better suited until you have an idea of resource usage trends.

2. Data security

Public cloud providers store your data along with other tenants and apply the same security for their whole infrastructure. If your data includes financial records or personal information of a critical nature, it is advisable to keep the data inhouse with dedicated servers or a private cloud. This allows you to implement access controls and multi-layered security systems that best meets your requirements.

3. Data growth trends

Some services such as media hosting, or applications that use big data have a high growth rate for disk space and bandwidth usage. For such applications, a private cloud solution would be an ideal fit. Storage arrays could be added on demand, while keeping the costs down. Bandwidth can be aggregated from all your servers to ensure maximum utilization of available resources. Public cloud could be very costly in this case due to the usage based pricing and dedicated servers would not be as easily scalable.

4. One time and recurring budget constraints

Public cloud has almost zero upfront cost, whereas the recurring costs would be higher than dedicated servers and private cloud based on resource usage. For about $300/month you can lease a dedicated server and with approximately $4000 you can get a co-located dedicated server. The recurring costs will be lesser than a public cloud, but you will occasionally need to invest in hardware upgrade and maintenance. A private cloud in a co-located environment will need at least $10,000 as initial investment, but the costs will even out and might even be cheaper than dedicated servers and public cloud in the long run.

5. High availability requirements

If the competitive edge of your services depends on high availability, you would need the fail-over and resource auto-scaling properties of cloud systems. Dedicated servers could face downtimes due to server load spikes, hardware maintenance, etc., leading to low uptime records. With a private cloud you will have greater control over which instances should be given higher priority, and the limits of resource scaling.

6. Infrastructure management overhead

Maintaining a pool of dedicated servers either in a leased environment or a co-located environment is the most manpower intensive solution. Each server needs to be monitored, updated and administered individually. Hardware maintenance is more common in dedicated servers than private or public cloud solutions. A private cloud solution requires less administrator man-hours than dedicated server due to its centralized management interfaces, and automated resource allocation features. Public cloud is at the other end of the spectrum where technical administration is limited to periodic updates and configuration updates as needed.

Conclusion

In reality, there is no one size fit all solution. Organizations use public cloud for part of their requirements, while using dedicated servers for the rest. It all boils down to what your priorities are, and how much you can invest into a particular solution. We’ve here discussed only the most common decision points, and there might be other decision factors based on your business model.

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