cloud Vs OnPremIncreasingly this question has more and more to do with the particular line of business in which a firm is engaged, the politics of the location decision, and the personal feelings of the executives involved. . . and less to do with any technology capability differences.

Integration engines from nearly all vendors are either in the process of, or have already covered the capabilities of their cloud-based offerings with the capabilities of their on-premises offerings.  Mainstream vendors already have a significant degree of portability between integrations created in the cloud and integrations created in an on-premises package and vice-versa.

While there are circumstances (notably a very geographically diverse location of data sources intended for integration) that can lead to a tangible advantage in hard costs for one approach vs another. . . those circumstances are rare.  In general, neither approach offers significant cost advantages vs the other.


What the two approaches offer are different ways to pay for the service:

  • On-Premises installations typically involve higher initial expenditures and lower or nonexistent ongoing fees for operation of the integration engine.
  • Cloud installations typically have lower or nonexistent initial fees and higher ongoing monthly costs.

The selection of which of those models best suits the financial interests of your firm has much more to do with the financial status and philosophy of your firm than any other characteristic.   In extremely long-term deployment scenarios, where an on-premises installation is left alone for 10+ years, an on-premises installation may present a cost advantage.  But in the current software development environment, expecting a 10+ year lifespan out of an installation is probably not a sound planning premise in the first place.

Often, the question of an on-premises installation vs a cloud implementation boils down to the perception of security risk on the part of the executives responsible for making the decision.  Very often, this decision is made with little actual information, and an excess weight on sensationalized news reporting.

If a careful analysis is done of the actual risks of data breach that face an enterprise, it shows that, contrary to popular opinion, there is very little increased risk associated with a cloud implementation of an integration tool, as opposed to an on-premises implementation.  The top types of data breach attacks, according to the Verizon Security Vulnerability report 2015, are as follows:

  1. Malware aimed at gaining control of systems
  2. Insider/privilege misuse
  3. Physical theft or loss
  4. Web app attacks
  5. Denial of service attacks
  6. Cyber espionage
  7. Point-of-sale intrusions
  8. Payment card skimmers
  9. Miscellaneous errors such as sending an email to the wrong person

Of these, 5, 7, and 8 are not applicable to the integration tool question;  1, 2, and 4 are no better or worse depending on where the data is housed; 3 is -less- likely with a cloud implementation; and only #6 is potentially a larger security concern with a cloud implementation than an on-premises one (and arguably, #6 is only a valid concern for relatively high-profile businesses).

In short, there are very few tangible, measurable reasons left in 2016 to choose an on-premises implementation over a cloud-based one.  The decision points will often come down to internal politics and opinion.

Thanks for taking the time to analyze this amazing field with us. We’d love to hear you opinions, so write your comments in the section below.

Share This