Not all clouds are created equal — a guide to the pros and cons of cloud-hosted vs cloud-based PLM.

Who doesn’t use some cloud application nowadays? Gmail, slack, salesforce, … according to a recent CIMdata survey, almost 80% of manufacturers already use cloud-based services. Although ERP and CRM are the most common cloud enterprises solutions, cloud PLM is starting to become more prevalent.

Today, most PLM vendors have now jumped the bandwagon, and are offering a cloud PLM. They have all recognised the undeniable advantages of cloud-based solutions — lower cost, scalability, simplifying implementation, cost savings by removing IT expenses, and providing a faster path to ROI.

So if you are considering adopting a cloud PLM solution, you should be aware of the different types of cloud terminologies that are out there.

Why is this important? Well, although all “cloud” solutions are available on the internet and offer a subscription model, there are important differences between them and understanding what are they, could help you make the best purchasing decision based on your business needs and budget.

There are two main differences in the cloud PLM landscape you need to understand: cloud-based PLM vs cloud-hosted PLM.

What is a cloud-hosted PLM?

Basically, a cloud-hosted PLM is a pre-existing software application that is hosted in a cloud data centre, managed by the vendor on behalf of the customer. The vendor provides its infrastructure as a service (IaaS).

This model of cloud follows a single tenancy architecture. This means that a single instance of the software and supporting infrastructure serve a single client. Each client has his or her own independent database and instance of the software.

What is a cloud-based PLM?

Cloud-based solution means that the vendors have built the PLM application directly in the cloud, starting from scratch, using a Software as a Service (SaaS) approach.  Model, servers, databases and code that are part of the software are also managed and hosted by the software vendors.

As per the cloud-hosted model, servers, databases and code that are part of the software are hosted by the software vendors. In this model, each client shares the software application, a single database and the servers. However, the data of each client is isolated and kept invisible to other clients.

An analogy often used to explain the difference between single and multi-tenant architecture is the one of renting your own house on a street that is shared by other private houses vs renting an apartment in a building where other apartments are rented by other people. In the latter, tenants can share maintenance cost, which makes it more affordable.

If you want to know more about the single vs multi-tenant difference, you can check this article.

So what does it all mean for your company? In the table below, we summarize how choosing one model over the other will impact your organization.

What’s important to you?

There are benefits and drawbacks to both single-tenant and multi-tenant systems. Ultimately, your company must decide what is most important to their business and what can be sacrificed.

Choosing your ideal cloud PLM solution will depend on a variety of factors: Is cost the primary driver? Is security critical for the type of data you are storing? Does your PLM solution need a lot of customization? Are you happy with using a one-size fit all system? Does your industry or country have unique regulatory constraints?

If you want to know which cloud PLM solution has a single or multi-tenancy architecture, stay tuned. We’ll soon publish an article to dive into cloud PLM solutions.

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