Will the Cloud Work for My Company’s File Storage Needs?

While providing IT Support for clients in the DC metro area, Network Depot frequently offers advice on the benefits and drawbacks of using the cloud vs. a server for their various IT requirements.

For more general information about what the cloud is and the various types of cloud options available, please see our earlier blog post: Forecast: Cloudy with a Chance to Save Thousands

In this blog post, we will compare using the cloud vs. a dedicated server for file storage needs. When considering this decision, it is first useful to think about what company information is housed or “lives” on a server.  There are three general functions (one being file storage) companies require with their corresponding data normally housed on a server, whether it is located at your location or whether it is located in the cloud; which means on a server at an offsite data center location.

Types of Data Housed on a server (on-premise or at offsite data center server in the cloud)


The most widespread Email program used by companies is Outlook. Companies using their own dedicated server for Outlook use an Exchange Server.

File Storage

Businesses utilize a shared company drive(s) to store files from various applications such as Office documents (Word, Excel, PowerPoint), Adobe, photos and images, and other important company documents. The files are normally housed in user-specific or department-specific folders with titles such as Sales, HR, and Marketing with folder permissioning applied in varying degrees.

Business Applications

Common business applications include Office, accounting programs such as Quickbooks and Great Plains, and CRM programs.  There are also custom-built business applications, which present special challenges for data migration to updated dedicated servers on-premise or to the cloud.

File Storage Best and Worst Business Practice

A best business practice for file storage is to store all important, company-specific files on a shared drive. This shared drive can either live on a dedicated server at your office or on the cloud; which means on a server at an offsite data center location. Conversely, a worst business practice is when employees store important files only on their workstation hard drives or on their laptops. This practice could be disastrous if a laptop is lost or breaks or if there are problems with the workstation hard drive. In these nightmare scenarios, important files could be lost or damaged, which would have severely negative results for your company.

Main Factors to Evaluate when Considering the Cloud

When thinking about the use of the cloud for its file storage requirements vs. the use of a dedicated server, a company needs to consider these main factors:

Company Size and Cost

The cloud is appealing to small businesses because there is a substantial cost for purchasing and maintaining a dedicated server. Servers generally need to be replaced within 5 years. This timeframe gives a good starting point for comparison as the cost of the server can be spread out over that time period. However, there is also the additional cost and inconvenience of fixing any problems with the server and other purchased hardware through in-house or outsourced IT support. The system must also be properly updated, which also costs time and money. There will also be licensing costs for the use of the server. In short, a company must be prepared to pay for the cost of labor, set-up, and maintenance of the server.

Sensitivity of Data

The issue of control and security is most important to companies, which have sensitive information contained in their files. This is particularly important in companies that have FINRA, HIPAA or other compliance and security requirements. In these circumstances, most companies would prefer to have their own dedicated server controlling their usage.

Importance of Easy Access to Files Remotely

Your company needs to weigh how important it is for your employees to have easy access to their files when working remotely. The cloud option makes files available online anywhere/anytime. Programs such as Dropbox allow users to go online and access their files with unmatched ease. To use the cloud effectively, your company must make certain that your internet connection is reliable as access to your files depends upon it.

With a dedicated server, companies can implement a VPN (Virtual Private Network) that enables users to access their files remotely anywhere/anytime. This option is generally more expensive than the cloud as a VPN license is required, but it has the advantage of keeping the files exclusively under the company’s control. Another option is to use the Remote Desktop program, which allows a user to access their entire workstation at work while using their own laptop or other device at home. The Remote Desktop user goes online (even with normally incompatible devices such as Apple laptops) and then accesses their complete desktop through the company’s dedicated server. Your company would need to pay for the license to this program for each user.


In our experience we have found that the best solution for small companies is usually all cloud or a hybrid of email, some applications, and some file storage on the cloud with any sensitive data housed on a dedicated server.  

The upward trend of more companies using purely the cloud and hybrid models will increase as cloud service providers continue to offer more bundled features and applications for their subscription service and as prices for cloud services continue to decrease.

In summary, there are advantages and disadvantages to using the cloud vs. a dedicated server for your file storage needs. Your company must take the time to carefully assess your unique file storage needs before making your decision.

For assistance in making your decision with this and any other IT-related requirements, please contact us here at Network Depot.

Business IT Solutions

Network Depot has been providing professional IT Support for businesses in and around Reston, VA since 1991. We strive to give our clients Enterprise-level services and solutions at prices that work for small businesses.

Time and experience has helped us develop best practices and workflow procedures around a proactive philosophy designed to keep your focus on your business, not your technology.

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