Hosted Solutions : Pros & Cons

Switching software and hardware from a licensed, in-house product to a leased service has many benefits for businesses. With web-hosted software, all that's needed to access the software is an internet connection, a web browser, and the proper authentication credentials and businesses can pay for the software over time, instead of making an investment of thousands of pounds upfront.

For smaller businesses without specialist IT departments or large amounts of capital invested in the bank, hosted solutions enable companies to reduce direct overhead costs because dedicated physical resources, such as servers, are not required. Furthermore, as the responsibility for maintaining and updating the software is shifted to a third party, there are also fewer human resource demands and reducing the need for support staff can provide savings in salaries, health care, liabilities, and training.

For most companies, the software needs of today may not be exactly the same as the needs of tomorrow. Hosted software as a service is well-adapted to this reality and allows companies to enable applications and features on demand so that businesses only pay for the functionality being used at the present time.

Hosted solutions are also inherently scalable - adding users does not require any client side software implementation and changes to user counts can be made as required, allowing licensing decisions to be based on the current needs. Furthermore, hosted solutions also offer a quick and easy way of extending functionality to multiple sites, including homeworkers, who are growing in number as businesses seek to keep operating costs down.

Historically, security represented a primary concern for businesses adopting web-hosted software or services. However, as the cloud computing model has matured, hosted services have been deployed securely in many companies and this concern has reduced, however experts are still divided on the issue as to whether network-based or hosted solutions offer the best security.

Proponents of software as a service point to the fact that web-hosted software is typically hosted from heavily secured data centres which often offer increased physical and logical security beyond what individual firms may be able to afford. The presence of service level agreements also usually specifies specific financial penalties for security compromises.

Companies hosting their own software may not be able to similarly transfer these financial risks to a third party. On the other hand, web-hosted software does rely on information passing through the public internet, where it may be more prone to security attacks, so it is important that businesses using hosted solutions have all of the appropriate security safeguards in place.

Today, adopters of web-hosted solutions typically still maintain a mixed software environment, utilising web-hosted software for some applications and network-based solutions for others. All things considered, it's not a question of one approach being better than the other, but a question of which one is right for you.