Choosing the right LMS (Learning Management System) platform is crucial for anyone looking to get into the elearning business.
Almost all LMS tools can be categorized into one of two fundamental groups: Self-Hosted and SaaS (Software as a Service). Both have their benefits and challenges, and the decision all boils down to your specific needs and goals.
In this article, we’ll compare SaaS and on-premise LMS in detail to help you make an informed decision.
So, let’s get started!
What is a SaaS LMS?
In a SaaS platform, the LMS is hosted on a cloud and managed and maintained by a third-party service provider.
Everything related to hosting, including servers, updates, and maintenance, comes under the responsibility of the SaaS provider. Thus, you can focus entirely on creating and delivering course content.
Thinkific and Teachable are some examples of SaaS-based LMS platforms.
Pros of Using a SaaS LMS
Below, we have listed some pros of using a SaaS LMS:
1. Quick Set-up
You can get a SaaS LMS up and running in minutes, making it ideal for clients who need quick deployment.
You don’t need to do much! Providers will take care of system updates, security maintenance, and things like that.
Just sign up to the platform of your choice, choose a plan, and set up a payment method.
2. Predictable Costs
In most SaaS LMS, the costs are predetermined and categorized into different pricing tiers. You only pay for the plan that you use.
SaaS LMS often have a minimal upfront cost—some even offer a free base plan with basic features for first-time users. You can unlock more features by going up the tier, but you will be billed accordingly.
When you use SaaS LMS, you don’t need to maintain any in-house IT infrastructure or hire a professional.
3. Scalability
Like most cloud-based services, you can scale a SaaS LMS quickly without much hassle. You don’t have to add servers and any resources yourself.
Your service provider needs to allocate more resources to your platforms, and oftentimes, it is automatic. Thus, you can handle increasing workload and demand without disrupting your users.
Cons of Using a SaaS LMS
Here, we’ve mentioned the most significant cons of using a SaaS LMS:
1. Limited Customization
SaaS LMS platforms offer few customization options.
To start off, the code base is beyond your reach. As a result, you won’t have the option to mold everything the way you want.
This is not a problem when you are starting out. However, once your business starts growing, you might feel limited by the platform.
2. Dependency on the Provider
When you sign up for a SaaS LMS, your data are stored in the service provider’s server. You are left with no option but to trust them for security and performance.
The concerns related to data ownership are decided in advance by service level agreements (SLA) between you and the platform. However, in most cases, you don’t have any say in it.
The data is often stored in a proprietary format, which makes it difficult to migrate to other platforms.
What is a Self-Hosted LMS?
If you decide to go the self-hosted route, you will need your server for your LMS and data. It is because in self-hosted LMS, the user is responsible for hosting the LMS.
It is also called on-premise LMS, as it is installed and operated on an in-house server.
You will be responsible for all the infrastructure required to run your LMS, including updating and maintaining the software and infrastructure.
Masteriyo and Sensei are some examples of self-hosted LMS.
Pros of Using a Hosted LMS
Below, we have noted down some of the pros of using a hosted LMS:
1. Cost Effective in the Long Run
While self-hosted LMSs are costly to set up, they are more cost-effective in the long run. This is because there is no recurring fee as in SaaS LMS.
Since you own all the resources, you only pay for operation and maintenance. You don’t have to pay extra for service charges, which can save you a lot of money in the long run.
2. Extra Layer of Security
In on-premise LMS, you have complete control over your data. You can choose how and where to store your data.
Thus, the data is more secure than in a SaaS LMS where the cloud resource is shared between multiple users.
You can add as many layers of firewall and encryption as you want. Likewise, you can immediately apply security updates right when you discover any vulnerabilities.
3. Customization and Flexibility
Hosted LMS is the most flexible when it comes to customization options. Users can modify the user interface and add or remove features to meet brands or specific requirements.
You can choose a hosting provider, network configuration, and server specifications that best meet your needs. Moreover, you can adapt your LMS to your changing needs.
4. Complete Ownership and Control
On-premise LMS provides complete control over your platform, unlike SaaS-based solutions.
You can decide which software to use and how to run, maintain, and update it. As your in-house IT professional builds everything from scratch, you’ll have complete control over everything.
Cons of Using a Hosted LMS
There are a couple of cons to using a hosted LMS. Here, we’ve presented the top two disadvantages:
1. Lengthy Set-up Time
Self-hosted LMS lacks the plug-and-play convenience of their SaaS alternative. Since you are responsible for everything from installation to onboarding, it takes significant time to get things up and running.
2. Requires Technical Expertise
You need a dedicated technical team to look after your self-hosted LMS. This team can be in-house or outsourced.
This is because on-premise LMS are more complex to use. This team is responsible for everything from normal operation and fine-tuning to security and maintenance.
SaaS LMS VS. Hosted LMS: Comparative Analysis
In this section of the article, we’ll compare SaaS LMS and hosted LMS.
1. Cost Analysis
When comparing the cost of a LMS system, it is crucial to consider both short-term and long-term expenses.
In the short run, SaaS LMS is less expensive. However, in the long run, Hosted LMS is more economical.
SaaS LMS follows a subscription-based pricing model which takes into consideration the resource allocated to you as well as the service fee.
In contrast, self-hosted LMS only requires initial installation and periodic maintenance, making it a better long-term solution.
2. User Experience
With a SaaS LMS, you don’t have to spend much time researching and designing interfaces. You are provided with a default navigation and interfaces.
You can tweak a few components, but a complete overhaul is not possible.
A self-hosted LMS may or may not provide an intuitive interface. However, you get the option to create one from scratch. So, the user experience depends completely on the research and design on your part.
If you’re a beginner or have little technical knowledge, SAAS LMS can be a suitable option. But if you have technical knowledge and want more customization flexibility, a hosted LMS is the one for you.
3. Technical Support
SaaS LMS offers technical support to all users who subscribe to its services. The type of support depends on the plan. Usually, premium users get to enjoy immediate responses and personalized assistance.
Meanwhile, in hosted LMS, you have to rely on your in-house or outsourced IT team for technical support. The effectiveness of this support is dependent on the qualification of the support professional and the design of the system itself.
4. Data Privacy and Security
In SaaS LMS, data are stored on the service providers’ servers. These servers are often shared between multiple users, which can raise concerns about privacy and security.
On the other hand, data are stored on your own hardware in a self-hosted LMS. Thus, you can ensure data privacy, security, and compliance yourself.
5. Customization and Flexibility
When it comes to customization and flexibility, self-hosted LMS offers way more than a typical SaaS LMS.
You can customize each component of your self-hosted LMS, whereas you are limited by the service provider in a SaaS LMS.
In an on-premise LMS, you can easily add and remove features based on your evolving requirements, which is not possible in a SaaS-based solution.
Self-Hosted Vs. SaaS LMS – Which is the Best Option for You?
Now that you have a clear idea of SaaS LMS vs. hosted LMS, you can make an informed decision based on your needs and requirements.
If you need a quick solution without technical complexities, SaaS LMS is the best for you. That said, it is rigid and often expensive in the long run.
On the other hand, self-hosted LMS gives you complete control over your system’s design, features, and data. However, it has a higher initial cost and is less scalable.
Both LMSs have pros and cons. You can decide based on what works for you and your business.