Capex vs Opex costs in cloud computing

There seems to be a lot of talk on capex vs opex in software development at the moment, everywhere I go someone gives me their opinion! For those of us who aren’t fully conversant at bean counting, the issue is – to say the least -complex. Furthermore the benefits of capex vs opex expenditure is not very well understood, especially by me!

I found an article by Bernard Golden written way back in March 2009 which sheds some light on the subject and in the third from bottom paragraph I found a sentence that was the eureka moment for me! http://www.cio.com/article/484429/Capex_vs._Opex_Most_People_Miss_the_Point_About_Cloud_Economics

The point is that capex expenditure is limited so if you are a start up or making a significant outlay in the project it would be beneficial to transfer data centre costs to Opex therefore leaving precious Capital for other (capital) costs like property! Bingo!

I don’t claim to be an expert in finance so if you have an opinion I would love to hear it…

3 Replies to “Capex vs Opex costs in cloud computing”

Comments are closed.