Physical Server vs. Cloud Server for small business

[R-Audi]

Bare with me as I am completely clueless with this stuff.
I work in a family owned company and we currently have a basic server in our office that is ~7 years old. We have been told by the company who handles our IT stuff that it is in dire need of replacement, which has brought up the conversation of buying a new server vs. Cloud servers.

About the company; we have 10 staff and two locations in downtown Calgary and primarily use the server to store our company files (billing/accounting/backup phone system/misc work etc).

Our IT guy is adament that we buy a new server and ugrade to a redundant server and given us a full quote. He immediately shoots down any notion of a cloud server, witth his main reasoning being security. (We certainly dont want to share our business details, but certainly dont posess any secretive information etc as we are a service related business)

Now we have been quoted $7,200 for the server and Windows license, which isnt ideal in this economic situation, but really I have no idea how that would compare to a cloud server or the pros and cons of each. Ive tried reading articles online, but find mysef not understanding most of the terminology.

Any insight from others in a similar situation?

The server were quoted on is:

HP Proliant ML350 G9 Xeon E5-2609v3 6core tower server/ Platinum 500w power supply x2/ server fans x3/ 16GB Ram/ Ethernet 1G 4port 331i adaptor/ Smart Array P440ar 2G/hot plug small form 600g 15K hard drive x2 Windows Server 2016 w/ 15 cal license

[roopi]

I know nothing about this stuff but $7200 for a server that 10 people will be accessing?

[94CoRd]

I am by no means an accountant, but with a cloud solution, you start to bring in monthly operating costs compared to the capital project costs seen with an on-premise solution. For a cloud-type scenario, instead of paying $7200 tomorrow to set up your HP, you'll pay let's say $1000 for initial configuration, and then $200/month for a virtual cpu/ram/HDD (depending on what you and your employees needs are). These numbers are completely made up of course and are dependent on who hosts your cloud. From a security perspective, it may be a bit more complex, but nothing I would classify as a major security concern.

Our company went from an aging, on premise server, to a cloud solution recently. It is much nicer to manage - thats for sure

In my experience, the IT guys who shy away from off-premise solutions, just don't understand it, or they get massive erections picking out and setting up brand new hardware.

[Xtrema]

1) List out what the server actually do. Is it just a file server? Is it a domain controller? If so how much storage? If it's just a file share, you can probably build a NAS for $1300-1500 that will give you 12TB of space.

2) Figure out if you want on premise solution or cloud solution. And which cloud solution.

Really with a 10 people company if you can adjust your workflow somewhat, moving the cloud solution isn't hard but keep in mind that you don't necessary save money and you may have to adjust to slower speed (1Gbps LAN va 100Mbps WAN). You just change capex to opex and you must find stable internet connection.

For example, if you can adjust to Office 365:

https://products.office.com/en-ca/bu...business-plans

That's about $150/month for 10 users and each user has 1TB of storage and can be shared. The questions is, does everything in your company can wort with this workflow change?

[revelations]

That quote is almost identical to one I competed against recently. The client is a small (less that 5 Workstations) financial services company (no data allowed offsite) downtown. Their IT company came back with an $8000 unit that offered essentially no improvements in storage capacity and would create further maintenance work for themselves.

I ended up building them, from scratch, a Windows 2012 server unit that was almost 1/2 the cost and met all their needs and tripled their storage from the other estimate (and is redundant).

Honestly, in many of these cases I wonder if a Domain Controller is really worth the headache for a few workstations (eg. less than 10).

Some of the smaller companies (with small budgets) I have setup have managed for years to make do with a dedicated PC that acts as a file share. A properly configured, shared, protected, 500$ box with a quality HDD or SSD is all you really need.

One thing to keep in mind is that the SAS systems offer huge data bandwidth to allow simultaneous file read/writes. It does depend a lot on the work that you do right now.

[ExtraSlow]

What possible downside is there to a cloud server?

[The_Penguin]

Originally posted by ExtraSlow
What possible downside is there to a cloud server?

Speed
Cost of upgraded bandwidth
Ongoing operating costs vs 1 capital expenditure spread over 5+ years
internet

[revelations]

^ I would also add redundant ISP, for most mission-critical data setups.

I work with an accountant who uses a remote VM and needs to run dual WAN/ISP routers (increased costs).

[eblend]

As others have mentioned, pros and cons.

I don't understand what he means about redundant server? He is only quoting you for one server, is he still planning to use the other one in some fashion?

Really you need to specify what it is this server does exactly, just file share, or is there more to it, domain controller ect? Azure can do a cloud based file share, directly to the cloud just like a windows share if that's all you need, this part is fairly simple with no networking knowledge required, anything else will require more complicated VPN tunnels back to your network and all that.

I support a client who runs like 4 VMs on my spare time on one ESXi host and I would never recommend he replace that server with another physical box, at least not anything by itself, and since he is small business as well, he doesn't want to spend money on the good stuff...so he is stuck on old hardware, but it still works, so kind of powerless to convince him.

You could get a server for a lot cheaper if you build it yourself too (I believe that's what one person was referring to), but not really recommended for a business, you really do want the more reliable hardware if you can't afford downtime.

If you are interested, I can drop by sometime and take a look. I support an environment of 100+ esxi hosts across 13 offices all over north america, 3 datacenters and 150+ remote sites, everything from network to servers...just to give an idea of my day to day. Free of charge to take a look and give a second opinion.

[pheoxs]

Originally posted by eblend
As others have mentioned, pros and cons.

I don't understand what he means about redundant server? He is only quoting you for one server, is he still planning to use the other one in some fashion?

Really you need to specify what it is this server does exactly, just file share, or is there more to it, domain controller ect? Azure can do a cloud based file share, directly to the cloud just like a windows share if that's all you need, this part is fairly simple with no networking knowledge required, anything else will require more complicated VPN tunnels back to your network and all that.

I support a client who runs like 4 VMs on my spare time on one ESXi host and I would never recommend he replace that server with another physical box, at least not anything by itself, and since he is small business as well, he doesn't want to spend money on the good stuff...so he is stuck on old hardware, but it still works, so kind of powerless to convince him.

You could get a server for a lot cheaper if you build it yourself too (I believe that's what one person was referring to), but not really recommended for a business, you really do want the more reliable hardware if you can't afford downtime.

If you are interested, I can drop by sometime and take a look. I support an environment of 100+ esxi hosts across 13 offices all over north america, 3 datacenters and 150+ remote sites, everything from network to servers...just to give an idea of my day to day. Free of charge to take a look and give a second opinion.

Perhaps he's referring to RAID 0 being redundant hard drive configuration so that incase one drive fails you don't lose any backup.

[redline]

In reality nothing wrong with the cloud for a business like yours.

Cons of the cloud:

Typically there are no backups but most smb seem to skip this anyway
S3 backups
Cost... for a file server it should not be a huge expense but I know of one company that runs a sql server with an app for one user that costs $2500/ month in azure
If you change your mind getting your data back can be issue
Reliance on internet or other telco to access any data

Pro
less it support which maybe why they are opposed
No capital costs


As others have mentioned a small nas can be had fairly cheap if all you need is file storage.

[revelations]

Originally posted by eblend
You could get a server for a lot cheaper if you build it yourself too (I believe that's what one person was referring to), but not really recommended for a business, you really do want the more reliable hardware if you can't afford downtime.

All the hardware was professional or server-grade (board, RAM, enterprise SSD, WD Gold series drives, etc.).

No corners were cut, save for redundant OS drive.

[spikerS]

honestly, the server build he is offering you seems WAY overpowered for a mere file server, but then again, I am not the tech guru I once was.

Personally, if it were me, if all I am doing is a file server, I would just re-appropriate a normal desktop PC into a file server since at the MOST, you will only have 10 people accessing it at any given time. I agree, I would be hesitant to be putting accounting files onto a cloud server, I would most definitely want that stored in house. It wouldn't be hard to build a secondary redundant server as well that everything gets backed up to as well, and it would be a fraction of the cost, and being that it is in house, most of the traffic would be on your internal LAN which would cut down on bandwidth costs too, not that they would be much with it being mainly for files...

I have done a few servers like this back in the day for small offices, not sure if it is still a viable option in 2016 though...

Or, a NAS is a great option too!

[rage2]

If I'm reading this right, you just need document storage.

Originally posted by R-Audi
primarily use the server to store our company files (billing/accounting/backup phone system/misc work etc).

If that's the case you don't even need a cloud server. You need cloud services. Dropbox business will cover your needs fine. Get the minimum 5 users, organize by business units for access permissions to share users, and you're done at a cost of $900 or so a year. You now have full backups as well as file versioning to protect you from ransomware attacks.

The only drawback here would be if your accounting and billing software uses a database. Your options there would be to just use a workstation to share those files with the people that need it, and backup daily to a Dropbox folder. The better way is to switch to a cloud based solution such as freshbooks or quickbooks online and not deal with all that stuff.

The security argument from your IT guy is silly, and a defense mechanism for job security. Sure you can argue that someone stealing your Dropbox credentials would have access to everything, but a piece of malware on a single desktop in your office will have the same implications and open up all your files to the guy on the other end.

[Xtrema]

Originally posted by ExtraSlow
What possible downside is there to a cloud server?

Potential issue with:

Sox or other financial audits
Canadian privacy laws
Data Sovereignty
Security in general

But these issue probably won't apply to OP's small company.

End of the day it is about access. Cloud mean anyone can grab anything without you knowing if you don't set it up right. Local hardware can potentially add a layer of physical security but Rage is right that data is one randsom ware away from being highjacked anyway.

Anyway, I think any company cannot afford 2 FTE IT guys should look at cloud services instead of on-prem hosting.

[ipeefreely]

Originally posted by R-Audi
Windows Server 2016 w/ 15 cal license

If you decide to go with this server... downgrade the license to Server Essentials (2016 or 2012 R2) to save $$$$ and then you won’t need CALs either which saves more $$$.

Server Essentials is aimed at small business and is licensed for up to 25 machines and 50 users (if you grow bigger you’ll have to move to standard). It sets up your active directory, remote access (VPN too), workstation & server backups and tons of other stuff. Add the WSUS role and you’ll have much greater control over windows updates for all machines as well.

It can also be used as a hybrid with cloud services integrated as well (Office 365, AD in Azure etc..).

If you go cloud definitely get a second ISP.

[suntan]

Better off with a QNap or Synology NAS if you're just serving files.

[A790]

Originally posted by R-Audi
Bare with me as I am completely clueless with this stuff.
I work in a family owned company and we currently have a basic server in our office that is ~7 years old. We have been told by the company who handles our IT stuff that it is in dire need of replacement, which has brought up the conversation of buying a new server vs. Cloud servers.

About the company; we have 10 staff and two locations in downtown Calgary and primarily use the server to store our company files (billing/accounting/backup phone system/misc work etc).

Our IT guy is adament that we buy a new server and ugrade to a redundant server and given us a full quote. He immediately shoots down any notion of a cloud server, witth his main reasoning being security. (We certainly dont want to share our business details, but certainly dont posess any secretive information etc as we are a service related business)

Now we have been quoted $7,200 for the server and Windows license, which isnt ideal in this economic situation, but really I have no idea how that would compare to a cloud server or the pros and cons of each. Ive tried reading articles online, but find mysef not understanding most of the terminology.

Any insight from others in a similar situation?

The server were quoted on is:

HP Proliant ML350 G9 Xeon E5-2609v3 6core tower server/ Platinum 500w power supply x2/ server fans x3/ 16GB Ram/ Ethernet 1G 4port 331i adaptor/ Smart Array P440ar 2G/hot plug small form 600g 15K hard drive x2 Windows Server 2016 w/ 15 cal license

If all you're doing is storing/accessing files, why not just get a 1TB Google drive for like $20/mo?

[suntan]

As a Canadian company I would never store files in a US datacentre that's subject to the Patriot Act.

[rage2]

Originally posted by Xtrema
Sox or other financial audits
Canadian privacy laws
Data Sovereignty
Security in general

These aren't even barriers for bigger companies buying cloud services anymore. We deal with this shit in our RFPs daily.

Originally posted by A790
If all you're doing is storing/accessing files, why not just get a 1TB Google drive for like $20/mo?

G Suite is actually $10/month/user which includes unlimited storage, but in our experience the sporadic sync errors makes it unreliable for business use. It works well if you use everything through G Docs/Sheets/etc and not rely on file sync, but I doubt it applies here which is why I brought up Dropbox. I hate to say it but Dropbox is more reliable when it comes to file sync (same with iCloud drive, One Drive...). No clue why G Drive just sucks in this department.

Originally posted by suntan
As a Canadian company I would never store files in a US datacentre that's subject to the Patriot Act.

Well thank god there are datacenters in Canada, EU, and other friendly regions haha.

We deal with so many customers that refuse to host their data in the US, it's actually quite funny.