Are Servers A Thing of The Past?

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No. I’ll just lead off by saying that servers are still a thing and will be for a long time. While servers may not be as necessary as they once were, the big tech companies are not going to stop making servers. Your need for a server may have declined, but that is because you are working in the cloud, and the cloud is…. well… servers.

So, the real question is, do you need a server anymore, or can you completely transition to the cloud. The recipe for that is two parts technology, one part preference and a dash of budget.


From a technology standpoint, you don’t need a server. The technology is there for most businesses to migrate to the cloud. Microsoft 365 has just about everything that you will need. Exchange/Outlook for email. Teams/SharePoint for files. Azure to manage computers, security and policies.

Azure isn’t an apples-to-apples replacement for your domain controller. With your internal server, you are using Active Directory and Group Policy to manage your network, users (employees) and various other services used in your business. Azure can also do all of this stuff, and they even call it Azure Active Directory, but it doesn’t work exactly the same. It’s like going from a local install of QuickBooks, to the cloud version. You get the main stuff, but the devil is in the details and the details aren’t necessarily there with Azure Active Directory. For me, that’s just fine. I.T. can get a little carried away with details sometimes.

Microsoft has some of their Dynamics-labeled Enterprise Resource Planning (ERP) and Customer Relationship Management (CRM) solutions in the cloud also. ERP and CRM are a whole other can of worms, that is simply too big of a discussion to get into here. Let’s just say that your ERP (and CRM) is likely to be a big CapEx project and you should take it very seriously. I see more ERP implementations fail than succeed, and it’s usually because the company bought an ERP that doesn’t match their business and culture. Cloud or server based, plan to spend a lot of time on your ERP selection and implementation.


Preference is a big factor. Many businesses have trust issues with the cloud. Whether that is for security reasons, or concerns about losing the Internet connection, and therefore access to your data. For both of those concerns, there are answers.

Remember when PayPal came out and people were worried about online banking? PayPal had better security than your local bank, your home and your business. More modern, cloud-based systems are very secure also. If you are concerned, consider the option and make the provider prove their security to you.

If loss of Internet is your concern, have multiple connections installed or invest in network equipment that uses LTE (like your mobile phone) failover. One connection goes down, another takes over. Simple. But what about speeds? Depending on where you are located, you can get some darn fast Internet. Spectrum is holding firm on pricy fiber connections, but AT&T and TDS and both providing fast fiber, for much lower cost. Something to consider.


Lastly, we have budget. We’ve touched on budget in the first two, as we considered technologies and preference. Cloud technologies are often more expensive, over time, but the costs are spaced out. It’s a lot easier to justify a few hundred dollars per month, than to take a major cash hit all at once, especially these days. Software as a Service (SaaS) models make it very easy to get the tools and technologies, that you need, without making a risky, upfront cash investment.

There is a shift in how I.T. budgets are spent with cloud systems. Instead of spending $20,000 on a server, you budget monthly for the cloud services, your Internet connection and your security. Your budget template changes, and you consider how your business has changed, with the emerging technologies now available, the pandemic and lessons learned from that, and the current struggles with sourcing materials and hiring employees. Cloud-based systems can help with all of that, but you have to embrace the change.

Do you really want to maintain a room for servers? The AC costs, the hardware costs, the support costs… if you don’t have to have that, why have that? We used to have rooms filled with file cabinets too. Technology replaced those cabinets, and it will replace your in-house server eventually also. It’s just a question of whether the technology, your preference and your budget are ready for that change now.