Date:
7 Dec 2022
Author:
PREO AG
On-Premise vs. Cloud
What is a hybrid cloud?
A hybrid cloud is a software licensing model in which a cloud version and on-premise software are combined as needed. This creates an IT landscape in which part of the required licences are permanently rented in the form of public or private cloud products and the other part is covered with newly or second-hand purchased licences. At PREO, for example, numerous customers combine Microsoft cloud services with audit-proof, used Microsoft volume licences for operating systems, servers and application software.
As one of the pioneers in the European trade with used software, we are proven specialists for software licensing models that are easy on your company's IT budget. Let's talk about it. Together we will find an effective and efficient solution for you. Our licensing experts will advise you in a fair, manufacturer-independent manner and in line with your current business situation.
What distinguishes hybrid software licensing models?
Total cloud, hybrid cloud, on-premise or a combination? There are many different software licensing models. It is not easy for companies, organisations and administrations to choose a licensing model that is optimally aligned with their strategic goals. This is because the selection and implementation of a licensing model is not a short-term project, but should always follow a medium- or long-term strategy that reflects the planned development of the company and supports it in a targeted manner.
Depending on the constellation, considerable financial potential can be unlocked through an individual and needs-based software licensing model - either through clever savings in ongoing licensing costs or also the sale of volume licenses that are no longer needed. A high degree of individuality and flexibility is therefore particularly important to most SAM managers. Our experience shows that this is especially the case with hybrid software licensing models, which also offer high efficiency potential. Certainly two essential reasons why the hybrid cloud is becoming more and more popular compared to the pure cloud solution.
Why hybrid software licensing models pay off
Especially companies and administrations that currently and in the medium term have to equip a high number of stationary workstations benefit from the advantages of a hybrid licence model. These are the most convincing for our customers:
1. You reduce your IT costs
Despite low one-off investments with cloud offers, high, annually recurring total costs arise compared to on-premise.
- With a hybrid licensing model, you can permanently and thus sustainably reduce your regular fixed costs compared to pure cloud solutions.
2. You avoid over-licensing without losing productivity.
A key cloud benefit is the freedom for your employees to be productive for the company wherever they are. But do all employees need and use these benefits?
- A hybrid licensing model allows you to subdivide the profiles according to use. For example, the implementation of an E3/E5 plan for 20 - 30 percent of the "power users" in combination with an Office On-Premise E1 plan with used volume licenses for the remaining workstations.
3. You retain data control
Data protection and data security are becoming increasingly important, especially in sectors that work with highly sensitive data on a daily basis, such as health, finance or even public administrations and authorities. It is always necessary and makes sense to manage this data internally and to be able to control the security strategy yourself.
- Hybrid licensing models allow you to control the level of your data security yourself.
4. You retain IT flexibility
If you opt for a pure cloud strategy, you inevitably reduce your responsiveness. The development of your software landscapes is then largely determined externally, for example through price increases, fixed update cycles or file format changes.
- With hybrid licensing models, you retain share-based fallback options and thus more flexibility. For example, the end of support for individual applications can be used to optimise the licensing structure without compromising IT performance.
Software licensing model hybrid cloud - 6 questions for an optimal start
Are you in the process of developing or realigning the licensing strategy for your company, but not yet sure whether an individually tailored hybrid model is the best solution? Based on numerous customer interviews, the PREO licensing experts have compiled the following questions, to which detailed answers have proven to be particularly important in advance:
- How many employees/clients are permanently tied to one location (office/production)?
- How many employees/clients work from different locations or remotely and therefore need more flexible access?
- In which areas are on-premise licenses sufficient?
- Which key features can also be provided via an on-premise solution?
- How much budget can be saved annually with a hybrid solution that includes used licenses?
- Are there internal requirements for data security or sovereignty that stand in the way of a shift to the cloud or at least make it more difficult?
Questions answered and still no decision made? No problem. The PREO licensing experts are happy to help and advise you personally. Send us an email or give us a call:
Examples of hybrid software licensing models in which the cloud share has been reduced
You have various options for reducing your cloud rent without having to completely forego the typical advantages of the cloud. One of the ways to do this is via customised hybrid software licensing models that combine online and on-premise resources, such as used volume licences, in one software licensing model and network them via a common platform.
Example 1: Mechanical engineering company achieves high 6-digit savings
A company from the mechanical engineering sector with 2,200 seats would like to procure the necessary licences as required. This involves 10 IT locations worldwide. The solution combines an MS Office 365 E1 plan with used licences for MS Office 2016 and Microsoft Windows 2016 Server including Windows Server CAL. The result is the functionality of an E3 plan, but without Office ProPlus.
- Result: Without any loss in productivity, the company achieves savings in the upper 6-digit range. The investment pays for itself in the second year.
Example 2: Health care provider saves 50 per cent of its licence costs
The private operator of more than 150 health care facilities wants to use the end of support of various applications to save costs while maintaining the same level of performance. This is achieved with the purchase of a comprehensive package of used licences, whereby the company even receives additional functionalities and its IT infrastructure becomes more agile.
- Result: The company modernises its software landscape and achieves a cost saving of over 50 per cent.
How much can be saved with hybrid software licensing models?
Unfortunately, there is no general answer to this question. The savings potential depends, among other things, on your industry, the size of your company and the respective needs for workplace equipment. In addition, there is your medium- and long-term corporate strategy. These are all aspects that can only be seriously clarified in a personal discussion. In advance, we can only calculate for you in a simulation scenario how high your savings potential could be.
Examples of hybrid software licensing models with expansion of the cloud share
Are you planning a complete migration from on-premise installations to cloud applications? Or do you want to further expand your cloud portfolio? The PREO licensing experts will advise you independently based on your goals and show you how to combine software licensing models according to your needs, thereby creating new financial leeway. As in these two case studies:
Example 1: Medium-sized company saves a mid 6-digit amount thanks to hybrid solution
A company with 1,200 employees wants to accelerate cooperation in marketing and customer advisory services and strengthen the mobility of workplaces. After detailed consultation, it decides on a hybrid model that includes second-hand licences.
- Result: Estimated savings of over 352,000 EUR in the first three years compared to the cloud-only solution.
Example 2: Sale of existing volume licences generates additional revenue
A company with 1,500 workstations in the administrative department wants to move the Microsoft applications used completely to the cloud. After detailed consultation with the PREO licence experts, the company receives an attractive offer from PREO for the purchase of the existing volume licences, so that no untapped potential is wasted.
- Result: The IT budget suddenly has an almost 6-digit amount at its disposal, which can be used to finance further projects.
You can find more details on our customer cases as well as exclusive whitepapers and further information available for download in our media centre.
Sell unused on-premise licences to PREO
Many companies already use the advantages of a hybrid software licensing model or are planning a changeover in the near future. But surprisingly, only some of them use the financial potential of on-premise licences that become available. PREO will be happy to advise you personally on how you can benefit financially by selling used volume licences that are no longer needed. Simply use the form below. We will calculate for you, free of charge and without obligation, what financial benefits you can expect.
