Why Security-as-a-Service reduces total cost of ownership (TCO)

Recently I have been getting a number of questions concerning the cost savings of a security-as-a-service (SaaS) model versus a traditional on-premise solution. While there are certainly a number of direct benefits to the end-user (easier to use and easier to upgrade), I thought for the purpose of this article to elaborate on the most important one: reducing the total cost of ownership (TCO) via the outsourcing of security services”.

So what is exactly meant by reducing the total cost of ownership? Well according to industry analysts a good portion of small to medium sized companies out-source their security services to a 3rd party provider. Obviously this strategy has real benefits especially to companies who lack the technical ability to manage and maintain an on-premise anti-malware solution.

Because SaaS traditionally hasn’t resided on-premise it takes the overhead of managing and maintaining a complex myriad of technologies and places the responsibility with the provider. Take for example a small medicare facility with 100 employees; now if we factor in the following variables into the equation and apply it to a SaaS model we can clearly see the reduction in TCO:

Direct costs with an on-premise solution:

* 2 hrs to install the management server at $200 per hr (average technical consultation fee)

* $1000 to $1500 for hardware (necessary for the management server)

* $800 to $1000 for Microsoft Windows 2003 Server licenses

Overall initial cost (not including the anti-malware licenses or the yearly technical support contract to support various products – i.e the server, the anti-malware product, etc) = $2900

Direct costs with a SaaS solution:

A SaaS solution does not have any direct costs in terms of infrastructure or on-going management as it is being out-sourced (the only associated costs are that of the anti-malware subscription). With an on-premise solution there is a much higher initial and on-going cost as hardware tends to require maintenance and because their is a lack of technical skill in-house; outside help is required to maintain the anti-malware product.

In conclusion SaaS promises to revert the trend and reduce costs while helping mid-size companies to realize security, but within their budgets.


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