2. capex vs opex

  • Buying your own infrastructure
  • Initial investment is high – bigger servers …
  • Maintenance required
    • support staff
    • power and networking
    • hardware failures
    • others…
  • Renting infrastructure – cloud perfectly fits this model.
  • cost is based on the usage.
  • pay for what you use.
  • Maintenance:- services is provided by cloud. you need to have only small operational team.
  •  
 

Capital Expenditure

Operational Expenditure

Up front cost

Significant

None

Ongoing cost

Low

Based on usage

Tax Deduction

Overtime

Same year

Early Termination
(cancelling the subscription)

No

Anytime

Maintenance

Significant

Low

Value over time

Lowers(hardware value will be lower)

No change – move to the newest version

Upgrade

Leave a Comment