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Is your server ripping you off?

01 Jul 2010

In the 80s, if an organisation with multiple branches wanted computers available to their staff, the only option available was to have dumb terminals linking to a server which ran the programs, stored data and did all the processing.

The main reason was that to get any decent computing power out of computers at that time they had to be huge, sometimes taking up whole floors of buildings. However, there were other advantages to this type of setup, some of which include: data was centralised and backed up, the dumb terminals were set up so the end-users could not wreck anything, and there were economies of scale.

Then in the late 90s PCs (personal computers) began getting more and more powerful. Not only were they getting faster, but PCs began getting more affordable and user-friendly with the advent of Microsoft Windows. Point-and-click made computers even easier for the novice to use. Computers got powerful and affordable enough so almost any program a business required could now be run on the PC: spreadsheets for accountants, word processors for writers, drawing programs for drafters. It then made sense for medium- to large-sized organisations to have local servers, so they could manage, share and back up their data. So the 90s and 00s became the two decades of the PC and local server. The world has now become hugely interconnected, with high-speed connections available in every country of the world.

Admittedly New Zealand, compared to the other OECD countries, is a bit behind on this one; however every day this is improving, with faster connections available to businesses because of ADSL2+, VDSL2+, highspeed wireless and fibre connections. This has opened the door to the next generation of services available to businesses: SaaS (Software as a Service) or hosted solutions. A hosted solution is when a provider hosts the service that you require on their servers in a data centre. It is easier, secure, cost-effective and more flexible for you. All too often the true cost of running a local server is not calculated.

Examples of costs generally excluded from local server quotes include: power, fixed IP addresses, backup and restore costs, updates, spam and virus protection, replacement costs 3-5 years, licensing, hardware replacement, and the list goes on.

With Hosted Terminal Services, all your programs and files are available to you and your staff from any computer in the world with an internet connection. It is a virtual desktop which you or your staff securely log into. It is a hassle-free solution, as you don’t have to worry about backups, licensing, server maintenance, hardware failure or any of the problems or cost that come with having a local server.

Also when you connect to the server, all data is encrypted so it remains private. One great example of hosted terminal services I recently saw used was with an accounting firm in New Zealand. One of their staff members went to China to visit family, and while she was away she was able to log into the company’s hosted server and continue to work on company files from China.

This gave the staff member job satisfaction and the accounting firm owner added productivity that he would have otherwise lost. Scalability and fixed pricing are two very important benefits of any SaaS model, including hosted terminal services. You pay a fixed monthly fee for each user and you grow or reduce your services when you want, which is really great for businesses that like predictable bills or experience regular staff growth or shrinkage. Are hosted services suitable for all businesses and organisations? Well, the short answer is no. If you run resource-hungry applications such as graphics programs or any very specialised programs, using local servers may be the best solution for you.

However, if your staff mainly use Microsoft products, a hosted server solution may just suit your needs perfectly. If you already have local servers, it certainly makes sense that you get your 3-5 year server life span out of them. However, if you are looking at upgrading or are paying a lot in server support costs, it may pay to get pricing for a hosted server sooner rather than later.