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Should my Business use DropBox or a Traditional Server?

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Server and Cloud StorageBusinesses today are facing a new challenge when it comes to storing, sharing, and backing up their company files.  Historically, every company’s data was stored on a server, and accessed by workstations in the office.  The server was able to store large volumes of data, centralize the backup responsibility, and share files with advanced permissions options.  Computer Courage sets up Windows Server technology and OS X Server technology for companies every week, and this type of traditional server system is still widely popular.

The traditional server model, however, is being challenged by changes in the way that a modern workforce operates.  A traditional server is closed off from the internet, making it hard for employees to access data from home or on the road.  VPN solutions can solve this, but they require the employees to be online in order to access files.  Furthermore, many workers today want to access and even edit documents from mobile devices such as iPhones and iPads.  A traditional server simply has no obvious way of supplying data to these devices.

These challenges have been answered, in part, by cloud storage services such as DropBox.  With DropBox, a company can put all of their files in the cloud, accessible from the office, from home, or from the road.  DropBox (and rival services such as SugarSync) provide excellent mobile apps allowing modern devices to access, edit, and share company data.  Most cloud storage services also offer data syncing, allowing users to access shared data even when they do not have an active internet connection.

As IT services consultants, we are often approached by businesses who are trying to decide which path to take – should they purchase and set up a traditional server, or should they embrace the new cloud storage services?  We have solved this problem for many companies and nonprofits, by evaluating the specifics needs of the organization and comparing it with the strengths and weaknesses of the solutions.  In this article, we’ll go over some of the main guidelines we use for selecting a traditional server or a cloud service.

Issue #1 – Security

A traditional server is usually more secure than a cloud storage solution.  With a cloud solution, all of the company’s sensitive data is placed on a cloud server that the company has no control of.  This alone is an issue for many organizations.  At Computer Courage, we believe that the primary players in the cloud storage field take appropriate security precautions, and that your data is safe in the cloud, but some organizations can’t rely on something they can’t control.

Beyond this, there is a more serious problem with cloud storage security.  Most of these services sync all of the server data to each computer, allowing the computers to access data even when they are offline.  This is very convenient, but does create another security concern: what happens if a laptop is lost or stolen?  In the case of DropBox, this means that a copy of the entire company data is exposed to a random stranger.  We expect to see cloud storage services evolve to solve this problem.  Some useful functions to solve this would include a) remote wipe – delete the data off a laptop after it is stolen, b) encryption and password – all synced company data should be encrypted on the user’s workstation, and a password should be required each time a session is started.

Traditional servers are not without  their own security problems however.  Servers must be constantly maintained, updated, backed up, and evaluated for security.  This requires regular maintenance costs and the cooperation of an IT consultant such as Computer Courage.

Issue #2 – Cost

The traditional server model, simply put, is more expensive for small businesses.  A good Windows Server tends to cost over $2,000 in parts alone.  Add VPN hardware for remote connectivity (at least $500) and backup drives and software (another $500+).  Beyond the hardware cost, companies must pay to have an IT consultant set up and maintain the server, which can add to the cost.  The only silver lining here from a cost perspective is that once set up, the company owns the server and does not have to pay monthly fees to keep the data accessible.

Cloud services typically require no hardware costs and very little setup time.  There is usually a monthly service fee associated with the service, but even the most expensive DropBox package (DropBox for Teams) is under $100 per month.

Issue #3 – Permissions and Access Control

Traditional servers use well developed tools such as Active Directory, Open Directory, LDAP, and filesystem permissions to allow for extremely fine-grained access control of files.  In a Windows Server environment, it is easy to set group permissions, allowing certain data to be accessible to certain users.  On servers, we often set up groups such as “Administrators”, “Financial”, “HR”, “Sales”, “Administrative”, etc. and share folders accordingly.  This way your receptionist cannot read your financial information, and your sales staff can’t access your HR data.

Setting up permissions like this on cloud services is not as easy.  Many cloud storage services embrace the philosophy of simplicity to the point where they do not offer more advanced controls such as permissions and access control.  As cloud storage develops, and more business and team-oriented services and features arise, this issue could easily be solved by the service providers.

Other Common Issues to Consider

Beyond the initial 3 issues – Security, Cost, and Access Control, there are a number of lesser considerations to factor when deciding between cloud storage and a traditional server.  Some organizations, businesses, or industries may have by-laws or regulations preventing them from using cloud services.  While the lack of maintenance or upgrades is mostly a bonus for cloud storage, it does allow the service provider to suddenly or unexpectedly change the way that that service works, which can cause headaches for organizations who were happy with things the way they were.

The Future is in the Cloud

Cloud storage is the future.  Even with a traditional server, most businesses want to enable remote access and off-site backup, which is likely to involve the cloud in one way or another.  At Computer Courage, we believe that Microsoft will integrate cloud storage solutions into Windows Server eventually, blurring the line between a traditional server and cloud storage services.  As Google and other large companies work to innovate the cloud storage field and create more business-oriented cloud storage solutions, we think that the pros of the cloud will start to easily outweigh the advantages of a traditional server.  For now, most organizations will benefit from a server.

If you have an organization and you want help setting up solutions such as this, or want to further investigate these options, please feel free to contact us for a free consultation.


  • Agreed that the main considerations are indeed Security, Cost and Access Control. Flexible deployment solutions is the way to go until the contention for cloud storage is resolved. One can choose to offer the same solution as a public cloud edition, pure on-premise/private cloud edition and even a hybrid edition to help out with the choices for organizations. What some business may be looking for is a managed Dropbox like solution on a private cloud ? Such an option may be attractive for the reluctant cloud adopter to derive the benefits of fast, easy and stable file synchronization with the security and control of a managed environment where only user accounts created by an IT admin have the ability to access shared or synced files. We are seeing the adoption of such solutions based on our experience with our product SyncBlaze

  • Adam, this is a great article! It clearly explains the pros and cons of a local file server versus cloud services. Thank you for sharing it.

  • Are there other options other than Dropbox. Seems like they are dominating the cloud storage arena…

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