“How much does Microsoft 365 cost?” is an easy question. “How much does self-hosted infrastructure cost?” is harder — but it is also the wrong way to frame the comparison. The real question is: what does each option cost in total over several years, and what else do you get in return?
The Hidden Parts of SaaS Pricing
The per-user monthly fee is the visible part. But the final bill is rarely just “user count times list price”:
Licence tier creep. In practice, many organisations end up paying for the highest tier across the board because it simplifies administration.
Add-on services. AI assistants, additional analytics, security tools — each an extra charge per user.
Price increases. Major cloud providers have raised prices repeatedly. You cannot negotiate away a price increase, and migrating to another platform is expensive precisely because you are locked into the ecosystem.
Storage limits. As the organisation grows, storage limits are exceeded. Additional storage costs extra.
The Cost Structure of Self-Hosted Infrastructure
A self-hosted Nextcloud setup has a different cost structure. No per-user pricing, but the upfront investment is larger: hardware, deployment, and ongoing operations are real costs.
The key difference is scale. SaaS costs grow directly with user count. Self-hosted infrastructure costs do not — the hardware is paid off, and additional users cost nothing more. Beyond a certain organisational size, the economics tilt clearly in favour of self-hosting.
In the first year, self-hosted infrastructure is typically more expensive. From the second year onwards, the monthly cost is lower.
What the Numbers Do Not Include
A straightforward cost comparison does not cover everything:
The price of vendor lock-in. In a SaaS model, you depend on the provider’s pricing and feature decisions. Self-hosted infrastructure eliminates this risk.
Compliance. For organisations with GDPR data residency requirements, self-hosting simplifies compliance documentation. In a SaaS model, achieving the same level of assurance requires more legal work.
Data ownership. With your own infrastructure, you know exactly where your data is. This is valuable in practice — not just in principle.
When SaaS Is Still the Right Choice
Self-hosted infrastructure is not the right answer for everyone. SaaS is generally better when the organisation is very small, IT expertise is limited, or Windows ecosystem integration is essential. Even in these cases, it is worth understanding what vendor lock-in means in the long run.
Next Step
If your organisation is considering a move to self-hosted infrastructure and wants to understand the costs for your specific situation, get in touch. We will go through your situation and assess what the total cost of a Nextcloud deployment would look like.