Choosing between a cloud and on-premises MTA

Being an ESP and MTA vendor, we notice a growing demand for on-premises solutions in all industries. But that is not for everyone.

You need to know the best type of MTA for your company. So, next to the features, should it be Cloud, On-premise or even Hybrid?

Choosing between a cloud and on-premises MTA

The comparison between cloud and on-premises for Mail Transfer Agent software has become like belief in one religion or another. Followers of “Cult A” keep producing data and theories that always come to the same business-driven conclusion: “all market trends are going towards this kind of solution”. Followers of “Cult B” instead focus on how easy-to-adopt solutions have little impact at the beginning but quickly become unmanageable in medium/long term.

Of course, we perfectly know that extremism is the opposite of rationality. Working in both cloud and on-premises solution markets allowed our company to have a more nuanced view on how the market is evolving. In 2016, after more than 15 years of experience in the market as ESP (MagNews is our email marketing platform), we decided to rebrand our MTA Solution.

EmailSuccess has been developed in-house 10 years ago, when both our customers and email volume were growing rapidly. We decided not to outsource this important component of our system. On top of the in-house usage (around 600 companies), the software was already used by all on-premises customers of our ESP solution.

Why should your company consider an on-premises MTA ?

In our experience the main reasons that drive the choice between a cloud and an on-premises solution are:

  1. Security and privacy: for many companies data is important and for others, there are market regulator constraints upon choosing a technical solution that will inevitably store that data. In some cases, the only way to conform with regulators is to have the full control of the software and this is one of the main reasons why many companies opt for an on-premises solution.
  2. Technical capabilities: MTAs are not complex solutions to install and configure, but they require a company able to manage the infrastructure. This is one of the main reasons why many companies opt for cloud.
  3. Cost: typically depends on specific needs, but usually a (one-time) license fee of the on-premises solution is less expensive than many monthly or annually volume-based fees, with the warning of having a higher startup cost.

Big senders like ESPs, marketing automation services, big eCommerce, frequent notification services will always more inclined to buy an on-premises MTA for cost and configurability reasons. As the higher volume tips the scale towards more attractive cost model for on-premises and the bigger gains on the more granular configuration.

From 1 million email/month could be considered a good start volume to consider in-house MTA. However, it’s always difficult to talk about numbers as being too rigid, not seeing other aspects that might suggest a dedicated MTA solution. If a sender needs to generate different types of communication (transactional, newsletter, etc.), a solution with a dedicated MTA permits more control on for instance, the delivery time of a single type of email. If that is the sole reason, the volume can be lower.

Example of how a configuration interface might look

Aspects like “sensibility to data retention” and “in-house technical capabilities” play an important role in the decision to opt for an on-premise service in sectors like finance and healthcare.
On-premises can be the right choice when a company needs a high level of control of his sendings and of his data.

What about the evolution of the MTA market?

The MTA market is growing and is clearly moving towards the cloud, but for what we can see, cloud solutions do not take into account specific needs for data protection and privacy. Almost each year market regulators are imposing new constraints on managing personal data, and companies should be ready when this rules hit the general market. For example the new GDPR, General Data Protection Regulation, for the EU that will become enforceable on 25 May 2018.

MTAs market have been also dealing with quite a few important changes recently, some players are evolving and other actors are emerging to provide alternatives. Companies should be ready to run new software selections to see if there’s something different to try.

Cloud, on-premise or… Hybrid MTA

Very structured companies need to refer to a strong vendor able to play in both cloud and on-premise.
Some clients need to internalize their email sending infrastructure. Because of factors such as business models, email volumes or security and privacy policies and evaluate hybrid solutions (e.g.: In-house ESP and outsource MTA components).

Hybrid is an interesting scenario for those companies that want to satisfy their needs for privacy, full data control, and high deliverability performance. Email vendors should quickly adapt their proposition to offer flexible and sustainable solutions to satisfy the specific needs of clients from all industries.

Last but not least, some interesting hybrid MTA solutions with only a portion of the marketing stack “in the cloud” are emerging. We daily have to do with this new kind of requests. Vendors should be ready to follow clients in adopting the right option.

Yes, it’s a quite interesting scenario, where performances and problem solving will make the difference (as well as economic competitiveness, of course).
What counts for users, is to work out objectives and capabilities before starting their MTA software selection and making a choice.

About Fabio Masini

Fabio Masini is CTO of Diennea, one of the pioneering companies in digital direct marketing with two proprietary platforms: MagNews and EmailSuccess. After graduating in Computer Engineering, Fabio started his work in Diennea 14 years ago. First as Project Manager, after years of experiences with major clients, he deals now with the management of the entire technological infrastructure and company’s services.

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