<s>
On-premises	B-General_Concept
software	I-General_Concept
(	O
abbreviated	O
to	O
on-prem	O
,	O
and	O
incorrectly	O
referred	O
to	O
as	O
on-premise	B-General_Concept
)	O
is	O
installed	O
and	O
runs	O
on	O
computers	O
on	O
the	O
premises	O
of	O
the	O
person	O
or	O
organization	O
using	O
the	O
software	O
,	O
rather	O
than	O
at	O
a	O
remote	O
facility	O
such	O
as	O
a	O
server	B-Operating_System
farm	I-Operating_System
or	O
cloud	B-Architecture
.	O
</s>
<s>
On-premises	B-General_Concept
software	I-General_Concept
is	O
sometimes	O
referred	O
to	O
as	O
"	O
shrinkwrap	O
"	O
software	O
,	O
and	O
off-premises	O
software	O
is	O
commonly	O
called	O
"	O
software	B-Architecture
as	I-Architecture
a	I-Architecture
service	I-Architecture
"	O
(	O
"	O
SaaS	B-Architecture
"	O
)	O
or	O
"	O
cloud	B-Architecture
computing	I-Architecture
"	O
.	O
</s>
<s>
The	O
software	O
consists	O
of	O
database	O
and	O
modules	O
that	O
are	O
combined	O
to	O
particularly	O
serve	O
the	O
unique	O
needs	O
of	O
the	O
large	O
organizations	O
regarding	O
the	O
automation	B-Application
of	O
corporate-wide	O
business	O
system	O
and	O
its	O
functions	O
.	O
</s>
<s>
On-premises	B-General_Concept
software	I-General_Concept
is	O
established	O
within	O
the	O
organisation	O
's	O
internal	O
system	O
along	O
with	O
the	O
hardware	B-Architecture
and	O
other	O
infrastructure	O
necessary	O
for	O
the	O
software	O
to	O
function	O
.	O
</s>
<s>
Cloud-based	B-Architecture
software	I-Architecture
is	O
usually	O
served	O
via	O
internet	O
and	O
it	O
can	O
be	O
accessed	O
by	O
users	O
online	O
regardless	O
of	O
the	O
time	O
and	O
their	O
location	O
.	O
</s>
<s>
Unlike	O
on-premises	B-General_Concept
software	I-General_Concept
,	O
cloud-based	B-Architecture
software	I-Architecture
users	O
only	O
need	O
to	O
install	O
an	O
application	O
or	O
a	O
web	O
browser	O
in	O
order	O
to	O
access	O
its	O
services	O
.	O
</s>
<s>
For	O
on-premises	B-General_Concept
software	I-General_Concept
,	O
there	O
are	O
several	O
costs	O
expected	O
to	O
incur	O
until	O
the	O
software	O
and	O
its	O
services	O
would	O
be	O
fully	O
available	O
for	O
use	O
.	O
</s>
<s>
First	O
of	O
all	O
,	O
the	O
construction	O
of	O
on-premises	B-General_Concept
software	I-General_Concept
within	O
the	O
organisation	O
requires	O
high	O
initial	O
costs	O
,	O
including	O
costs	O
incurred	O
for	O
the	O
purchase	O
of	O
hardwares	B-Architecture
and	O
other	O
infrastructures	O
as	O
well	O
as	O
costs	O
required	O
for	O
software	B-Application
installation	I-Application
and	O
examination	O
.	O
</s>
<s>
In	O
addition	O
to	O
this	O
,	O
the	O
entity	O
is	O
entitled	O
to	O
the	O
purchase	O
of	O
the	O
license	B-License
particular	O
to	O
the	O
software	O
,	O
which	O
involves	O
costs	O
and	O
time	O
for	O
the	O
preparation	O
and	O
required	O
procedures	O
.	O
</s>
<s>
On	O
the	O
other	O
hand	O
,	O
in	O
general	O
,	O
the	O
initial	O
costs	O
required	O
for	O
the	O
use	O
of	O
software	O
services	O
are	O
considered	O
relatively	O
low	O
for	O
cloud-based	B-Architecture
software	I-Architecture
and	O
thus	O
suitable	O
to	O
small	O
enterprises	O
without	O
a	O
large	O
amount	O
of	O
capital	O
.	O
</s>
<s>
Moreover	O
,	O
cloud-based	B-Architecture
software	I-Architecture
users	O
are	O
not	O
subjected	O
to	O
license	B-License
fees	O
as	O
well	O
as	O
maintenance	O
and	O
operation	O
costs	O
since	O
these	O
are	O
on	O
hands	O
of	O
software	B-Application
vendors	I-Application
.	O
</s>
<s>
Furthermore	O
,	O
costs	O
incurred	O
for	O
infrastructures	O
are	O
expected	O
to	O
be	O
smaller	O
compared	O
to	O
on-premises	B-General_Concept
software	I-General_Concept
as	O
users	O
only	O
need	O
their	O
electronic	O
devices	O
to	O
be	O
able	O
to	O
get	O
access	O
to	O
the	O
services	O
.	O
</s>
<s>
Although	O
initial	O
costs	O
for	O
the	O
access	O
to	O
services	O
are	O
usually	O
low	O
for	O
cloud-based	B-Architecture
software	I-Architecture
,	O
total	O
costs	O
required	O
for	O
the	O
use	O
of	O
software	O
over	O
a	O
specific	O
time	O
period	O
are	O
unsure	O
as	O
cloud-based	B-Architecture
software	I-Architecture
requires	O
routine	O
payment	O
(	O
i.e.	O
</s>
<s>
monthly	O
subscription	O
fee	O
)	O
for	O
the	O
use	O
of	O
services	O
whereas	O
on-premises	B-General_Concept
software	I-General_Concept
does	O
not	O
.	O
</s>
<s>
The	O
entity	O
using	O
on-premises	B-General_Concept
software	I-General_Concept
are	O
fully	O
responsible	O
for	O
the	O
daily	O
operation	O
and	O
maintenance	O
of	O
the	O
system	O
by	O
itself	O
.	O
</s>
<s>
On	O
the	O
other	O
hand	O
,	O
for	O
cloud-based	B-Architecture
software	I-Architecture
,	O
it	O
is	O
a	O
software	O
provider	O
who	O
is	O
responsible	O
for	O
the	O
system	O
operations	O
and	O
maintenance	O
.	O
</s>
<s>
As	O
for	O
the	O
maintenance	O
and	O
operations	O
,	O
the	O
entity	O
using	O
on-premises	B-General_Concept
software	I-General_Concept
is	O
also	O
responsible	O
for	O
backup	B-Protocol
and	O
storage	O
of	O
software	O
data	O
.	O
</s>
<s>
For	O
cloud-based	B-Architecture
software	I-Architecture
,	O
the	O
entity	O
has	O
no	O
requirement	O
of	O
data	B-Protocol
backup	I-Protocol
by	O
itself	O
,	O
as	O
this	O
is	O
also	O
a	O
responsibility	O
of	O
the	O
software	O
provider	O
and	O
data	B-Protocol
backup	I-Protocol
is	O
perquisite	O
for	O
the	O
provider	O
in	O
offering	O
their	O
services	O
.	O
</s>
<s>
As	O
discussed	O
,	O
users	O
are	O
responsible	O
of	O
data	O
management	O
for	O
on-premises	B-General_Concept
software	I-General_Concept
while	O
for	O
cloud-based	B-Architecture
software	I-Architecture
,	O
the	O
responsibility	O
is	O
on	O
the	O
software	O
provider	O
.	O
</s>
<s>
However	O
,	O
the	O
difference	O
in	O
the	O
level	O
of	O
safety	O
over	O
data	O
security	O
between	O
on-premises	B-General_Concept
and	O
cloud-based	B-Architecture
software	I-Architecture
is	O
arguable	O
.	O
</s>
<s>
Some	O
experts	O
claim	O
that	O
cloud-based	B-Architecture
software	I-Architecture
is	O
likely	O
to	O
be	O
more	O
secure	O
as	O
they	O
have	O
more	O
amount	O
of	O
capital	O
and	O
other	O
resources	O
to	O
invest	O
in	O
data	O
security	O
system	O
than	O
normal	O
business	O
entities	O
.	O
</s>
<s>
While	O
others	O
argue	O
that	O
this	O
is	O
questionable	O
as	O
software	B-Application
vendors	I-Application
are	O
usually	O
more	O
exposed	O
to	O
being	O
targeted	O
by	O
cyberattacker	O
as	O
they	O
hold	O
vast	O
amount	O
of	O
data	O
within	O
the	O
system	O
.	O
</s>
<s>
On-premises	B-General_Concept
software	I-General_Concept
was	O
invented	O
first	O
mainly	O
for	O
the	O
purpose	O
of	O
corporate-wide	O
process	O
automation	B-Application
of	O
large	O
entities	O
in	O
advance	O
to	O
the	O
evolvement	O
of	O
cloud-based	B-Architecture
software	I-Architecture
,	O
SaaS	B-Architecture
.	O
</s>
<s>
SaaS	B-Architecture
emerged	O
in	O
the	O
early	O
2000s	O
,	O
and	O
some	O
of	O
businesses	O
that	O
published	O
SaaS	B-Architecture
products	O
have	O
experienced	O
a	O
failure	O
,	O
as	O
customers	O
wanted	O
SaaS	B-Architecture
particularly	O
for	O
the	O
purpose	O
of	O
the	O
automation	B-Application
of	O
single	O
specific	O
corporate	O
functions	O
rather	O
a	O
than	O
corporate-wide	O
system	O
.	O
</s>
<s>
The	O
reason	O
the	O
business	O
model	O
was	O
not	O
widely	O
known	O
at	O
that	O
time	O
was	O
the	O
lack	O
of	O
broadband	B-General_Concept
penetration	O
and	O
that	O
there	O
was	O
no	O
sufficient	O
internet	O
accessibility	O
to	O
effectively	O
make	O
all	O
the	O
on-demand	B-Architecture
software	I-Architecture
service	O
work	O
effectively	O
.	O
</s>
<s>
As	O
SaaS	B-Architecture
market	O
evolved	O
in	O
the	O
2000s	O
,	O
as	O
opposed	O
to	O
on-premises	B-General_Concept
software	I-General_Concept
,	O
the	O
cloud-based	B-Architecture
software	I-Architecture
got	O
adopted	O
by	O
the	O
market	O
demand	O
to	O
serve	O
many	O
types	O
of	O
businesses	O
,	O
including	O
small	O
and	O
large	O
corporations	O
,	O
and	O
to	O
automate	O
specific	O
business	O
processes	O
within	O
them	O
.	O
</s>
<s>
In	O
addition	O
,	O
SaaS	B-Architecture
allowed	O
customers	O
to	O
make	O
selections	O
among	O
many	O
functions	O
depending	O
on	O
each	O
customer	O
's	O
needs	O
and	O
economic	O
conditions	O
.	O
</s>
<s>
Although	O
on-premises	B-General_Concept
software	I-General_Concept
previously	O
had	O
the	O
huge	O
advantage	O
of	O
being	O
capable	O
of	O
customization	O
and	O
tailoring	O
software	O
services	O
to	O
each	O
business	O
needs	O
,	O
SaaS	B-Architecture
has	O
also	O
evolved	O
as	O
a	O
platform	O
where	O
customizable	O
services	O
are	O
available	O
to	O
some	O
extent	O
as	O
cloud-based	B-Architecture
software	I-Architecture
market	O
develops	O
.	O
</s>
<s>
On-premises	B-General_Concept
software	I-General_Concept
was	O
prevailing	O
in	O
2013	O
in	O
the	O
software	O
market	O
,	O
however	O
,	O
more	O
and	O
more	O
customers	O
and	O
thus	O
software	B-Application
vendors	I-Application
are	O
shifting	O
toward	O
cloud-based	B-Architecture
software	I-Architecture
.	O
</s>
<s>
For	O
instance	O
,	O
SAP	B-Application
was	O
originally	O
an	O
on-premises	B-General_Concept
software	I-General_Concept
vendor	O
.	O
</s>
<s>
In	O
accordance	O
with	O
the	O
change	O
in	O
technologies	O
and	O
customer	O
preferences	O
in	O
the	O
software	O
market	O
,	O
the	O
company	O
has	O
turned	O
itself	O
into	O
cloud-based	B-Architecture
ERP	O
provider	O
that	O
are	O
available	O
both	O
in	O
public	O
cloud	B-Architecture
and	O
private	O
clouds	O
depending	O
on	O
the	O
customer	O
's	O
needs	O
.	O
</s>
<s>
Microsoft	O
previously	O
provided	O
on-premises	B-General_Concept
ERP	O
such	O
as	O
for	O
automation	B-Application
of	O
corporate-wide	O
business	O
system	O
of	O
large	O
corporations	O
.	O
</s>
<s>
Recent	O
years	O
the	O
company	O
has	O
been	O
published	O
many	O
cloud-based	B-Architecture
software	I-Architecture
such	O
as	O
and	O
that	O
provide	O
customers	O
internet	O
services	O
that	O
offer	O
automated	O
and	O
standardized	O
business	O
functions	O
for	O
specific	O
area	O
of	O
the	O
businesses	O
.	O
</s>
<s>
Salesforce	B-Application
has	O
brought	O
revolution	O
to	O
business	O
's	O
CRM	O
process	O
through	O
its	O
cloud-based	B-Architecture
software	I-Architecture
service	O
,	O
including	O
Sales	O
Cloud	B-Architecture
that	O
offers	O
best	O
suitable	O
standardized	O
business	O
processes	O
regarding	O
the	O
customer	O
relation	O
to	O
the	O
businesses	O
.	O
</s>
<s>
Over	O
the	O
last	O
decade	O
of	O
software	O
market	O
,	O
an	O
increasing	O
trend	O
toward	O
cloud-based	B-Architecture
software	I-Architecture
from	O
traditional	O
on-premises	B-General_Concept
software	I-General_Concept
has	O
been	O
appeared	O
with	O
an	O
acceleration	O
to	O
its	O
speed	O
.	O
</s>
<s>
At	O
the	O
time	O
of	O
2016	O
,	O
despite	O
this	O
trend	O
,	O
most	O
of	O
corporations	O
maintained	O
their	O
traditional	O
information	B-Application
management	I-Application
system	O
through	O
on-premises	B-General_Concept
software	I-General_Concept
.	O
</s>
<s>
This	O
suggested	O
that	O
the	O
trend	O
shift	O
in	O
software	O
market	O
is	O
occurring	O
with	O
a	O
slow	O
pace	O
as	O
the	O
businesses	O
are	O
gradually	O
shifting	O
their	O
software	O
system	O
from	O
the	O
traditional	O
on-premises	B-General_Concept
to	O
cloud-based	B-Architecture
.	O
</s>
<s>
In	O
2020	O
,	O
approximately	O
70%	O
of	O
business	O
customers	O
are	O
planning	O
new	O
or	O
further	O
transitions	O
from	O
on-premises	B-General_Concept
software	I-General_Concept
to	O
cloud-based	B-Architecture
software	I-Architecture
.	O
</s>
<s>
In	O
accordance	O
to	O
this	O
consumer	O
movement	O
toward	O
cloud-based	B-Architecture
solutions	O
in	O
software	O
market	O
,	O
more	O
and	O
more	O
vendors	O
,	O
including	O
industry	O
leading	O
software	O
corporations	O
such	O
as	O
Microsoft	O
,	O
Oracle	B-Application
and	O
SAP	B-Application
,	O
shift	O
their	O
business	O
model	O
and	O
transfer	O
their	O
products	O
to	O
cloud-based	B-Architecture
solutions	O
.	O
</s>
<s>
Faster	O
shift	O
from	O
on-premises	B-General_Concept
to	O
cloud-based	B-Architecture
is	O
expected	O
in	O
B2C	O
market	O
than	O
B2B	O
market	O
.	O
</s>
<s>
This	O
is	O
because	O
businesses	O
usually	O
require	O
much	O
more	O
complex	O
structure	O
and	O
system	O
of	O
information	B-Application
management	I-Application
in	O
contrast	O
to	O
private	O
users	O
.	O
</s>
<s>
Primary	O
customers	O
for	O
relatively	O
new	O
software	O
,	O
SaaS	B-Architecture
,	O
was	O
the	O
non-users	O
of	O
on-premises	B-General_Concept
software	I-General_Concept
as	O
it	O
was	O
easier	O
for	O
them	O
to	O
make	O
the	O
purchase	O
,	O
installation	B-Application
and	O
implementation	O
of	O
its	O
service	O
due	O
to	O
the	O
factors	O
previously	O
discussed	O
such	O
as	O
the	O
lower	O
installation	B-Application
cost	O
and	O
the	O
lower	O
system	O
management	O
cost	O
.	O
</s>
<s>
As	O
the	O
convenience	O
of	O
these	O
features	O
associated	O
with	O
cloud-based	B-Architecture
software	I-Architecture
becomes	O
widely	O
known	O
,	O
more	O
customers	O
(	O
mainly	O
businesses	O
)	O
start	O
shifting	O
their	O
software	O
system	O
toward	O
cloud-based	B-Architecture
as	O
they	O
have	O
been	O
realizing	O
that	O
SaaS	B-Architecture
brings	O
more	O
efficiency	O
to	O
their	O
information	O
and	O
system	O
management	O
.	O
</s>
<s>
Another	O
factor	O
resulted	O
in	O
the	O
difference	O
of	O
the	O
pace	O
of	O
market	O
adaptation	O
toward	O
cloud-based	B-Architecture
software	I-Architecture
was	O
the	O
degree	O
of	O
concern	O
and	O
legislation	O
regarding	O
data	O
security	O
.	O
</s>
<s>
Some	O
vendors	O
,	O
particularly	O
for	O
those	O
who	O
have	O
originally	O
been	O
offering	O
on-premises	B-General_Concept
software	I-General_Concept
,	O
are	O
not	O
willing	O
to	O
shift	O
their	O
software	O
service	O
to	O
cloud-based	B-Architecture
as	O
they	O
will	O
need	O
to	O
change	O
their	O
business	O
model	O
entirely	O
and	O
this	O
requires	O
a	O
large	O
amount	O
of	O
cost	O
,	O
time	O
and	O
efforts	O
.	O
</s>
<s>
Besides	O
the	O
demand-side	O
(	O
or	O
customer-side	O
)	O
factors	O
above	O
,	O
this	O
vendor	O
reaction	O
could	O
be	O
another	O
reason	O
for	O
the	O
slow	O
migration	O
toward	O
cloud-based	B-Architecture
services	O
in	O
software	O
market	O
.	O
</s>
<s>
The	O
movement	O
toward	O
cloud-based	B-Architecture
software	I-Architecture
not	O
only	O
implies	O
the	O
change	O
in	O
business	O
's	O
information	B-Application
management	I-Application
system	O
but	O
also	O
result	O
in	O
potential	O
change	O
in	O
their	O
value	O
creation	O
processes	O
.	O
</s>
<s>
Cloud-based	B-Architecture
platform	O
incorporates	O
the	O
functionality	O
of	O
facilitating	O
the	O
interactions	O
and	O
communications	O
among	O
customers	O
and	O
producers	O
due	O
to	O
its	O
feature	O
of	O
being	O
accessible	O
from	O
various	O
stakeholders	O
at	O
the	O
same	O
time	O
,	O
while	O
on-premises	B-General_Concept
software	I-General_Concept
usually	O
limits	O
the	O
access	O
to	O
its	O
platform	O
owner	O
in	O
exclusion	O
to	O
other	O
group	O
of	O
individuals	O
.	O
</s>
<s>
Cloud-based	B-Architecture
software	I-Architecture
provides	O
the	O
software	O
services	O
in	O
relatively	O
more	O
flexible	O
way	O
and	O
with	O
more	O
variations	O
.	O
</s>
<s>
The	O
reason	O
of	O
this	O
exists	O
in	O
the	O
architecture	O
of	O
cloud-based	B-Architecture
software	I-Architecture
platform	O
that	O
consists	O
of	O
a	O
number	O
of	O
different	O
platforms	O
with	O
different	O
specialty	O
and	O
functions	O
.	O
</s>
<s>
As	O
discussed	O
above	O
,	O
on-premises	B-General_Concept
solution	O
and	O
cloud-based	B-Architecture
solution	O
have	O
both	O
positive	O
and	O
negative	O
sides	O
respectively	O
.	O
</s>
<s>
In	O
transition	O
to	O
cloud-based	B-Architecture
solution	O
for	O
the	O
information	B-Application
management	I-Application
,	O
customers	O
 '	O
concern	O
involves	O
the	O
security	O
of	O
data	O
,	O
privacy	O
,	O
and	O
many	O
more	O
that	O
may	O
be	O
better	O
provided	O
by	O
the	O
traditional	O
on-premises	B-General_Concept
solution	O
.	O
</s>
<s>
In	O
order	O
to	O
deal	O
with	O
this	O
problem	O
,	O
the	O
software	O
market	O
came	O
up	O
with	O
new	O
solution	O
to	O
combine	O
on-premises	B-General_Concept
and	O
cloud-based	B-Architecture
solution	O
and	O
its	O
best	O
features	O
.	O
</s>
<s>
While	O
standard	O
cloud-based	B-Architecture
software	I-Architecture
usually	O
offer	O
standardized	O
solution	O
and	O
service	O
to	O
a	O
broad	O
range	O
of	O
customers	O
within	O
an	O
industry	O
and/or	O
market	O
area	O
.	O
</s>
