Why Software Solutions (SaaS) Should be Getting a Closer Look
As seen on Volpefirm
7/14/14 by Brady Volpe
The cable industry is traditionally a hardware solution focused industry. In a nut shell, there are AMPs, coax and RF signals. Eventually we migrated into hardware and mixed software solutions with SNMP and the emergence of DOCSIS. Today more then ever the cable industry is seeing a larger migration towards software and cloud-based solutions including software defined networks or SDN. I often get the question which is better? Hardware is more embedded and something operators understand, you can hold it in your hand and look at it with all it’s connectors, but it is also more expensive, less adaptable and needs man hours to maintain it.
CAPEX vs. OPEX
Some companies prefer to keep OPEX down. But there are tax benefits to use OPEX over CAPEX. CAPEX cannot be fully deducted in the period when they were incurred. Tangible assets are depreciated and intangible assets are amortized over time. OPEX (operating expenses) are fully deducted in the accounting period during which they were incurred. SaaS (software as a service) and SDN is ever increasing and most accounting groups are familiar with these. With that said both software and hardware have their advantages and disadvantages. Each has it’s place but since we all know hardware, here is food for thought on software and it’s many benefits. So you’re looking for a solution that suits budget and technical requirements. Some still think that hardware is the only solution, i.e. test equipment. Okay granted you will still need some hardware and an iPad or Android device to interface with the software solution but more and more operators should be asking “should I opt for software over a hardware solution?” For businesses with tight budgets and resource limitations, software is often the best choice.
There are situations when hardware is required, however here are some reasons why software in many cases is better:
1. It’s money in the bank, and who does not like that. Software costs less
Less CAPEX and OPEX. How is this not a win? In most cases hardware solutions are more expensive than software products. The price of the hardware includes the costs of board spins, pre-production runs, manufacturing, boxes, storage, delivery, defects, supply chain and all the other related expenses for a piece of hardware to go to your hands. Not to mention your tech’s man hours for maintenance of equipment, power consumption, yearly calibration, etc.
2. It can co-habitate. Software can live with other software
What does that mean? One server can support many departments or locations via virtualization as a core component of their infrastructure. So in layman’s terms you can easily have several software applications on the same server. Hardware, on the other hand, is limited to its original fit, form and function. This makes software solutions and virtualization ideal for those who need to be flexible.
3. Updates and upgrades are easier with Software
When you use hardware, you are stuck with the hardwares specifications for the duration of its life. What happens if your logs outgrow the storage space on the hard disk of the appliance? What happens if your company grows or shrinks? Software can be installed on almost any hardware, and then upgraded accordingly. You can deploy on multiple installations, or on multiple servers, when needed. You do not need to plan and buy large hardware “just in case”. When you outgrow your installation you can upgrade your server or scale-out, and in this way your old hardware won’t be thrown away; it will simply be repurposed.
4. Less effort – Software is significantly easier to deploy
A lot of software requires few, if any, infrastructural changes to be deployed. Hardware units require more effort, including occasional infrastructural changes such as increased rack space, additional power, more cabling, connectors, and introduces more points of failure etc. My mom can even use an iPad so software that is interfaced with an iPad, which even a mom can use is pretty easier to deploy.
5. Less Cost – Software is simpler and much less expensive to deploy across multiple locations
You don’t need to buy any additional hardware for each location. It just works and is cheaper to use.
Software can be easily downloaded and installed. You don’t need to wait for the delivery of the hardware. No tracking of packages, no “did it come yet” hassle to get it through customs if delivered from another country, or return of the product if it has a defect. Software even offers trials to allow you to “try before you buy”.
7. The Power of The Cloud
The cloud is available everywhere. It’s not just a trendy term. It means no equipment to maintain, extra connectors, cables, power usage and valuable rack space being used up. No extra points of failure and moving to the cloud often represents a business decision which is often financially motivated. Companies used to have to buy their own hardware equipment, the value of which depreciated over time. But with the cloud, companies only have to pay for what they use. This model makes it easy to quickly scale use up or down. The cloud is such a big deal; it helps companies save thousands of dollars a year.
8. Ease of backing up – Software is straightforward to back up
A software solution is very easy to back up and restore. If something goes wrong, and you have been backing up your digital data, just restore to your last backup point. You can’t do this with hardware appliances.
There will always be a need for hardware devices. However, when you evaluate the everything, especially functionality, ease of use and costs, software is often better.