One reason companies have justified an on-premises server is local performance – no one wants to have time to go find a cup of coffee while waiting for a file to open!
Performance will always be faster for the on-premises server – and yet many of the perceptions of local vs hosted services (LAN (Local Area Network) versus WAN (Wide Area Network) come from days when a fast ISP (Internet Service Provider) connection was 1.5Mbps (a T1 line), and often was much less. Today a typical business Internet connection is 100Mbps – the speed of the LAN not so long ago.
The question is not really fair – “is cloud service slower” – on a technical level, of course service will be slower working over the Internet. A different question might be whether performance accessing documents and information over the Internet is acceptable, or whether it is slowing down employee productivity. One perspective is that satellite offices of large companies have been operating over the WAN for many years – larger companies typically have a central data center, and do not place servers in satellite offices.
Discussion of network performance often centers around bandwidth. As important is latency – the time required for data to be received after placing the request. Years ago latency was typically in the 80 msec (MilliSecond) range – today it is generally below 14 msec. This can be the difference between waiting an inordinately long time to open or print a document, and having that operation complete in moments time.
The short answer is that performance of cloud service has been found to be excellent and highly workable for most companies over a number of years.
Where performance falls below acceptable, there are generally good options in the Boston area, including high speed fiber, coax and microwave.