Cloud-Based Vs. Premise-Based

When it comes to choosing an IPTV or OTT platform to offer to your users, you have a lot of different options to choose from. However, it's not really as simple as choosing one platform over another. Instead, you also have to determine, first and foremost, whether you would rather go with a cloud-based platform or a premise-based platform. Each option has its own advantages and disadvantages, and, in reality, there is no "right" choice. It's really all a matter of selecting the option that works best for you and your clients.

It is important, of course, to understand the difference between the two platform options. To begin with, OTT platforms consist of both a technical software and hardware platform that allows users to broadcast television services to their subscribers. With the cloud option, on the other hand, all of the required servers and the general control panel are located in the cloud and in remote data centers; the user then leases the usage of the platform in return for a monthly payment. Obviously, these two options are quite different for your business process, so it is very important to choose the right one.
Available Features
Before you even think about whether to go with a cloud-based system or a premise-based system, you want to think about the exact features that are offered with each option. Obviously, this will be dependent, at least somewhat, on the features and service-providing companies available in your area. With that said, though, there are some similarities from one system to the next, and both do perform the same core functions, so it basically boils down to a matter of choice. One thing to keep in mind is that you can typically get more features with a premise-based solution than you can with a cloud-based solution. In general, all of the features that are available with a premise-based solution will be available with a cloud-based one, but the opposite is not always true. Thus, if, in your area, you don't have as many features and options with a cloud-based system, you may be forced, at least temporarily, to offer a premise-based one until other options become available.

Cloud-based systems, though, do tend to be the more modern option since they offer expanding possibilities and assist with the development and improvement of CDN broadband technology. Whether you choose to go with the cloud-based option or not, you will want to ensure that at least these bare minimum features are available:

  • Transcoders
  • Control system/Middleware
  • Streaming servers
  • VoD servers
Total Costs
In addition to features and qualities, of course, you also have to consider what you and your business can afford. Whether you go with a cloud-based service or a premise-based service, you can expect to pay some money upfront to get your capabilities set up. From there, you can also expect monthly fees.

The good news is that, as a service provider yourself, you can easily recoup most if not all (and then some) of these fees if you correctly and successfully utilize the services you receive in return. Thus, it is imperative that you find a service that is well within your business budget, both immediately and long-term and that you successfully market it to your consumers. If you can successfully do these things and maintain a "business eye" over the entire operation, you should be okay, cost vs. profit-wise, no matter which option you choose.

If you do, however, choose the cloud platform option, you will typically pay a relatively small payment (cost varies based on the number of subscribers) each month. With the other option, you will just make a one-time payment, but this payment will usually be quite large upfront since it includes the cost of installation, configuration of equipment, hiring and training of all relevant and necessary staff, the purchase and/or rental of premises and equipment, cabling, infrastructure, and all other necessities. Thus, in addition to considering all of the other factors mentioned here, you will also have to think about whether you wish to invest in our new offering only upfront or for the long-term.

Furthermore, it is not just the investment of money that matters; your time is also quite precious and must be invested, to some degree, with either choice. If you go with the cloud platform, it won't require a lot of time; it can be instituted and ready for use very quickly. In fact, most businesses will have their cloud services up and running within a week. Getting set up and ready to go with an on-premise solution, however, can take a month or longer, depending on your current set-up and how much needs to be changed, so you will also have to think about whether you want or need to get started right away or are willing and able to wait awhile.

Cloud based systems, in general, will lower your costs. You do not have to worry about maintaining the system yourself. There's a large database which is maintained for you thus cutting time and cost.
Control and expertise
On premise solutions do give you more control and allow you to make more decisions but can cost more. Not all options are available in the cloud either.

On premise solutions require expertise. You need to be experienced working with every element of the system and know how to organize your network and make sure you hire the right person for system maintenance.

If you are aligned more in the business side of things it may be better to use a cloud based solution where all maintenance is handled by the ISP. If you are a technician, this may be easier for you to work with using an on premise solution.
Choosing the right model
Not all companies offer both cloud and on premise solutions at the same time. It is advantageous to offer both at the same time which gives both options to users thus making this decision easier.

If you don't know where to begin, it is most likely best to start off using a cloud based solution which would be a safe start. This will help deploy and test quickly.

When you do ultimately make the decision about which type of platform to go with or to switch to, there are, of course, going to be some upfront costs involved, including installation costs. While, as mentioned, you can get a good deal on either option as long as you do your research, most people do end up paying a lot less when they go with a cloud-based system.

That is because cloud-based systems require very little hardware or actual installation of equipment. With premise-based systems, though, you do have to buy real hardware and then have it put in by contractors and pay their fees. So, if you do end up choosing the premise-based option or making the switch to it, you should be prepared to pay a bit more upfront than you would with the cloud option.

Another issue that plagues premise-based systems is constant server repairs and replacements. When servers go down, they have to either be fixed or replaced; on average, even the best servers rarely last more than five years when they are being steadily used.

While repairing or replacing servers might not seem that costly when you're bringing in a nice profit, this is still money that you don't necessarily have to be spending. There are very few maintenance type costs involved with cloud-based systems, and you don't have to worry about any expensive piece of equipment breaking.

While each individual business must decide which option best fits its needs, this is certainly something to think about, along with the other factors presented here, and a good reason to consider cloud-based systems over premise-based ones.

As you can see, there are lots of things to think about and consider when trying to choose between cloud-based and premise-based systems. For that reason, don't rush the decision. Consider all of the factors discussed here, talk with industry experts, and seriously consider what is going to be the best and most sustainable choice for you and your business both now and in the long run. As long as you are careful and selective, then you should end up making the right decision, and remember, you can always change your mind later if you find that the option you've chosen isn't a perfect fit.