To deploy cloud or not to deploy cloud, that is the question for SMBs

A new report offers a snapshot into the deployment preferences of some smaller companies when given the choice of on-premise or cloud-based software. Take a look at the numbers.


Dr. Noel Radley, Managing Editor at Software Advice, wrote a report titled Cloud vs. On-Premise Software: Changes in Preference From 2008-2014. The report kicks off by saying, "There has been a radical shift in deployment preference over the past six years: 88 percent of buyers preferred on-premise solutions in 2008, while 87 percent preferred cloud solutions in 2014."

That's quite a statement. What is Software Advice, and who are these buyers?

Software Advice, Inc.

Software Advice is a company in Austin, Texas that is the software equivalent of a real estate or insurance broker. Cecilia Riester, media relations specialist at Software Advice, said the company is "a free online resource that helps organizations choose the right software. We connect software buyers with software vendors by offering free phone consultations where we shortlist products that meet their specific business needs. We operate in nearly 30 different software markets, and have helped over 200,000 buyers find the right software to date."

Software Advice's customers

The report is a summary by one company in Texas about its customers. The report is not a vendor-commissioned white paper or deep dive into the state of the industry -- it's half a dozen charts and a few bullet points.

This report is not about market leaders. Riester said, "The majority of companies we speak with at Software Advice are from smaller organizations; in the case of this deployment preference report, 84 percent of buyers were from companies with 50 employees or less. This is a snapshot into cloud preferences for that segment of the market."

The numbers

The deployment preference in the report is an either/or choice about where to run a purchased software product: either on-premise or cloud-based. The report doesn't address complex arguments such as PaaS vs. SaaS, hybrid vs. off-premise, or OpenStack vs. VMware. Perhaps Software Advice customers couldn't care less about these nuanced high-tech arguments.

In 2008 big vendors were joining Amazon in the cloud computing industry and Gartner said "Cloud Computing Will Be As Influential As E-business." However, only the high-tech and high-volume companies were seriously thinking about cloud computing; everyone else was still getting to grips with buzzwords like web 2.0 and Twitter.

The six years from 2008 to the present -- from an on-premise preference to a cloud preference -- is the time it has taken for cloud computing to become ordinary. For most organizations, cloud is just another IT option.

Image: Software Advice

Cloud computing may not even be a favourite option for small companies. The report says construction buyers' preference for cloud solutions "decreased from 11 to 5 percent." Most Software Advice customers don't even express a preference. The reports states "the percentage of buyers without a deployment preference has grown significantly; from 20 percent in 2008 to 64 percent in 2014."

Cloud computing is just another option

The report from Software Advice illuminates a very small part of the IT world, though it may hint at the state of modern IT -- a state where cloud computing has become as ordinary as plumbing.

We may all like to study the big players and follow where they lead, but it's the small organizations that make the world go round. Perhaps small organizations don't really care where their software goes, as long as it delivers business value.

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By Nick Hardiman

Nick Hardiman builds and maintains the infrastructure required to run Internet services. Nick deals with the lower layers of the Internet - the machines, networks, operating systems, and applications. Nick's job stops there, and he hands over to the ...