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Total cost of ownership comparisons between cloud and on-premises should include

  • A.only the difference in the electricity consumed
  • B.staff time, power, cooling and hardware refresh cycles
  • C.the hardware purchase price and nothing beyond that
  • D.only the monthly invoice sent by the cloud provider

Answer: B

Correct answer: staff time, power, cooling and hardware refresh cycles

A comparison against the cloud invoice alone flatters on-premises, because the hardware price omits everything around it: the data centre space, power and cooling, the network and storage, the staff who operate it, the spares, the licences and the replacement in three to five years. Counting all of it usually narrows the gap considerably in both directions - which is why the honest answer to which is cheaper is that it depends on the workload.

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