I could have sworn I ALWAYS ended up paying more for renting something than when I just bought it outright... Pah. Must just be my imagination. And maybe it's just my lack of business acumen, but to me, if you spend $100k... $100k is SPENT. When you say, "We're not spending it on internal capital resources anymore, these are now operating costs, so they don't count," to me it seems like you're in total denial that you've actually spent anything (except to the people you've paid the money to).
Then taking the 'savings' and spending it in other places, is like spending money you don't have! Why not just get the extra money and throw it at product development ANYWAY?
But then, I live in a tiny little house because I've never believed in spending make-believe money that I don't actually HAVE.
"I was going to have to spend 250k. but the "rent" is only 10k per month, and, since I'm only going to be here 12 months, I'll only spend 120k. what should I spend the big savings on? I know: my bonus for saving money!"
I agree with the first two posters... where do we ever see rental/lease models to save money over outright purchases? There may be some confusion... cloud services can reduce a company's cash outlay, and perhaps that frees up cash that enables a company to do other things they wouldn't normally be able to do, or at least not in the short term. However, over the long term, a company will spend more on cloud services than traditional IT services. But perhaps the cash outlay savings allows a faster track to additional revenues that are in turn used to grow the business faster such that the longer-term cost of cloud services can be justified. Don't get me wrong, I realize that cloud services have other benefits over traditional systems, but generally speaking, reduced costs are not one of them.
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