On-premises software

The software consists of database and modules that are combined to particularly serve the unique needs of the large organizations regarding the automation of corporate-wide business system and its functions.

[3][4][5] In addition to this, the entity is entitled to the purchase of the license particular to the software, which involves costs and time for the preparation and required procedures.

Furthermore, in order to maintain the software functionality, sustainable maintenance and operations are required and the entity will be subjected to the costs incurred for these as well.

Furthermore, costs incurred for infrastructures are expected to be smaller compared to on-premises software as users only need their electronic devices to be able to get access to the services.

While others argue that this is questionable as software vendors are usually more exposed to being targeted by cyberattacker as they hold vast amount of data within the system.

[7] Microsoft previously provided on-premises collaborative platforms such as SharePoint2010 for automation of corporate-wide business system of large corporations.

[2][6][7] At the time of 2016, despite this trend, most of corporations maintained their traditional information management system through on-premises software.

[2] In accordance to this consumer movement toward cloud-based solutions in software market, more and more vendors, including industry leading software corporations such as Microsoft, Oracle and SAP, shift their business model and transfer their products to cloud-based solutions.

This is because businesses usually require much more complex structure and system of information management in contrast to private users.

[2] Primary customers for relatively new software, SaaS, were the non-users of on-premises software as it was easier for them to make the purchase, installation and implementation of its service due to the factors previously discussed such as the lower installation cost and the lower system management cost.

Another factor resulted in the difference of the pace of market adaptation toward cloud-based software was the degree of concern and legislation regarding data security.

[6] In fact, developing economies where subjected to less restrictions regarding data security and legacy management, showed a relatively quicker response to the software market trend shift.

[2] Besides the demand-side (or customer-side) factors above, this vendor reaction could be another reason for the slow migration toward cloud-based services in software market.

[7] Cloud-based platform incorporates the functionality of facilitating the interactions and communications among customers and producers due to its feature of being accessible from various stakeholders at the same time, while on-premises software usually limits the access to its platform owner in exclusion to other group of individuals.

However, neither choice would provide customers the perfect solutions as both software do not offer full functionalities to its users.

[12] The core purpose of this software product is to solve a specific business issues of individual customers and provide a unique solution to that through technology.