The Rise of Self-Hosted Software: 5 Reasons Why SMBs Prefer It
Self-hosting, which involves managing dedicated servers instead of relying on a cloud service provider, is gaining popularity once again—and not just among tech enthusiasts. Increasingly, small and medium-sized enterprises (SMBs) in Europe with up to 50 employees are choosing this solution to reduce costs, enhance security, and gain greater control over their data.
But why are so many SMBs turning to self-hosting? Here are some key factors driving this trend.
1. Wider Access to Server Technology
Setting up a server is no longer just for large enterprises
Today, setting up a business server no longer requires a massive investment. Many SMBs can leverage affordable hardware, such as refurbished servers or even powerful desktop computers, to host critical business software.
Self-hosting has also resurged thanks to the widespread availability of fiber optic internet in Europe, providing the speed, capacity, and stability needed to maintain an efficient in-house infrastructure.
2. The Abundance of Open-Source Software
Enterprise alternatives without expensive licenses
Open-source software offers SMBs a wide range of tools without licensing costs, enabling them to implement essential services without relying on costly cloud software providers.
Additionally, its flexibility allows businesses to customize solutions to meet their specific needs, providing a competitive advantage over cloud-based options with standardized features.
3. Cost Savings
Fewer subscriptions, more budget control
Cloud solutions typically operate on a monthly or annual subscription model, which can become a significant expense for SMBs. In contrast, self-hosting requires an initial investment in hardware and maintenance but can significantly reduce operating costs in the long run.
For example, instead of paying monthly for cloud storage, a company can set up its own file server using a NAS, avoiding recurring fees. The same applies to document management platforms, email services, or CRM systems, where self-hosted alternatives eliminate the need for ongoing per-user payments.
Furthermore, scalable cloud models can, in some cases, end up being up to four times more expensive than a dedicated server over time.
4. Reduced Dependence on Cloud Providers
Business continuity without external disruptions
Cloud service outages can severely impact an SMB’s operations. Depending on the provider, a disruption can lead to downtime for critical systems such as email, storage, or collaboration tools.
With a self-hosted system, businesses can avoid these risks and ensure greater operational stability. Moreover, if a provider changes its terms or discontinues a service, the company won’t be forced to migrate hastily to another platform.
To ensure data security and availability, it is essential to implement measures such as disk duplication and follow the 3-2-1 backup rule.
5. Full Control Over Data
Security and privacy in the hands of the business
One of the greatest benefits of self-hosting is complete control over business data. Instead of trusting third parties to store sensitive information, SMBs can manage their own servers and establish their own security policies.
This not only protects against data breaches and leaks but also against data collection by external providers. Additionally, it enables businesses to comply with data protection regulations without relying on a third party’s compliance guarantees.
Following best practices for server security is crucial to prevent unauthorized access. However, by not depending on major providers, the risk of being affected by large-scale security breaches is also reduced.
Conclusion
Thanks to technological advancements and growing access to affordable solutions, self-hosting is becoming a viable option for many SMBs. Whether for cost savings, data control, or independence from third parties, this trend is enabling businesses to manage their digital tools more efficiently without compromising security or functionality.