advantages and disadvantages for CIOs

Technology infrastructure and how it is managed is one of the top priorities for IT departments. For this reason, the Cloud vs On-Premise comparison is a recurring debate in all sectors, and choosing one or the other model (or combining them) directly influences the agility, security and competitiveness of companies.

The truth is that the cloud has been in the spotlight for many years and when it seemed that everyone was going to adopt the cloud as a model, voices against it continue to appear, mainly related to the price or data security. Why Cloud vs On-Premise is still a topic of conversation among CIOs? Perhaps, by describing the advantages, disadvantages and trends of both models, some of the keys can be discovered.

What advantages does Cloud vs On-Premise provide?

The choice between Cloud vs On-Premise involves a deep reflection on the benefits that each model can bring to companies and, especially, to CIOs who must align ICT infrastructure with business objectives. The cloud primarily stands out for its flexible pay-per-use model, which eliminates the need for large initial investments and allows companies to dynamically adjust spending based on their real needs. Compared to the rigidity of own hardware, the cloud allows resources—whether storage, processing or application services—to be scaled practically instantaneously, adapting to peaks and valleys in demand without interruptions and without critical systems being affected.

Furthermore, in the Cloud vs On-Premise duel, the cloud offers global accessibility: systems and applications can be used from anywhere and on any device, favoring hybrid work and multinational collaboration. This is key in environments that require mobility and permanent connectivity, boosting productivity and organizational agility. Another relevant point is the transfer of responsibility for maintenance and updates, since cloud providers assume these tasks, freeing up internal resources and allowing IT teams to focus on projects of greater strategic value.

Thanks to the cloud ecosystem, companies quickly access new technologies—such as artificial intelligence solutions or advanced analytics—without high barriers to entry, which encourages continuous innovation. In short, Cloud vs On-Premise translates into an option where scalability, financial and technological flexibility, greater accessibility, rapid deployment and an innovation environment that can hardly match traditional local infrastructure prevail.

Why not abandon the on-premise model

Despite the advance of the cloud, the reality of Cloud vs On-Premise shows that many organizations continue to rely—totally or partially—on local infrastructures.

Data control and sovereignty: Regulated sectors such as banking, health and public administration consider direct data management an imperative; Cloud vs On-Premise in these environments usually tips the balance towards on-premise due to the sovereignty and confidentiality of critical information.
Customization and integration: Some legacy systems, such as industrial software or custom ERPs, require levels of integration and adaptation that the cloud cannot always match cost-effectively.
Regulations and compliance: Directives such as the GDPR or national regulations require that certain data do not leave specific jurisdictions, which is why Cloud vs On-Premise remains in force.
Operation without dependence on the internet: In latency-sensitive industries or with critical availability needs, relying on connectivity can be a limitation to fully migrating to the cloud.
Long term cost: Although the cloud reduces CAPEX, for loads that require intensive and predictable use of resources, on-premise can be more profitable over a multi-year horizon.

Application and upload data not moving to the cloud

It is estimated that by 2028 approximately 70% of workloads will have been migrated to the cloud, but applications considered mission-critical, such as high-performance databases (Oracle, SAP, military/defense systems), remain predominantly on-premise or hybrid architectures. The report estimates that by 2027, 50% of mission-critical applications will remain outside of centralized locations in public clouds, and organizations are reluctant to migrate them due to security, complexity, and integration with legacy systems.

What advantages does the on-premise model have?

The Cloud vs On-Premise debate resurfaces with the assessment of the strengths of the local environment:

Enhanced security: Physical and logical control over servers allows you to implement personalized security policies and meet regulatory requirements more easily.
Complete control of the infrastructure: Companies can define the architecture, the technology life cycle and update times in detail, adjusting them to their needs without external dependencies.
Efficient regulatory compliance: On-premise makes it possible to keep data and applications under direct surveillance, essential for industries subject to regular audits and strict regulations, facilitating evidence of compliance.
Customization: The ability to customize applications and operational flows is almost unlimited, from support for legacy software to particular integrations that are difficult to replicate in as-a-service models.
Guaranteed operability and performance: In sectors where internet latency or instability can compromise operations (banking, energy), local systems ensure continuity and predictable performance.
Supplier independence: Companies are not exposed to unilateral price changes, discontinuation of services or third-party policies, which mitigates long-term strategic risks.

These advantages explain why Cloud vs On-Premise remains an open question, especially in highly regulated sectors or with mission-critical loads.

The hybrid cloud as an element to take advantage of all the advantages of both worlds

Faced with the Cloud vs On-Premise dilemma, the hybrid cloud option has usually gained great prominence in recent years. And this model, in which the advantages of public and private cloud are combined, together with local on-premise systems, can provide a specific response to business needs and sector regulations.

According to IDC, in a study carried out for the consulting firm Seidor, in 2023, 45% of Spanish companies were already adopting hybrid cloud models, using multicloud solutions to maximize efficiency and control. This scenario, in which Cloud vs On-Premise are integrated, allows the following:

Operational flexibility: Organizations can run sensitive applications locally, and take advantage of the cloud for less critical systems, balancing costs and risks.
Spending optimization: The CAPEX of the own systems is reserved for constant and predictable loads, while the cloud is used to scale quickly in the event of temporary peaks.
Better security and compliance management: The most sensitive data remains under direct control on-premise, while productivity and collaboration applications are delegated to cloud providers with high security standards.
Innovation and agility: Hybrid cloud facilitates innovation in areas such as AI, big data and machine learning, without compromising the integrity of essential operations.
Better adaptation to the business context: Hybrid models allow you to respond agilely to regulatory changes, new markets or mergers and acquisitions, adapting the infrastructure as corporate strategies evolve.

The key, for CIOs, is to define clear data orchestration, integration and governance policies between both environments, as well as unified monitoring and response mechanisms in security and availability.