Do You Need A Hosted Learning Management System?

Do You Need A Hosted Learning Management System?
Summary: Some of the most popular Learning Management System products in the market today (including the likes of Halogen, Docebo, Citrix, and Moodle) come with hosted variants of their software. What kind of businesses need them and why?

Does It Make Sense To Host Your LMS On Your Own Server? What Kind Of Business Need A Hosted Learning Management System

The benefits of hosting your Learning Management System on the cloud has been well established by now. In short, cloud-hosted Learning Management System tools come with a lower set up cost, have enhanced security features, improve accessibility, are easier to maintain, and are faster to deploy. For a good reason, then, corporate businesses increasingly prefer their Learning Management System software to be deployed in the cloud that can then be remotely accessed by employees regardless of where they are located. Having said that, does it still make sense for businesses to pick hosted Learning Management System solutions over the cloud? What kind of businesses need hosted Learning Management Systems and why?

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Localized eLearning

Hosting a Learning Management System on the cloud is a good idea when your employees are located across multiple geographies. But businesses that have a localized workforce may prefer to host their eLearning platform on a local server. This is especially true if your learners are located in places that have intermittent internet access. A good example for this is the eLearning imparted to blue-collar workers in industries such as mining who are located far away from the cities with internet connectivity. A hosted local server can help these workers access learning materials at high bandwidth that cloud-hosted services may not be able to provide.


Most cloud-hosted Learning Management System solutions are subscription-based, and the price of the product depends on the number of learners and storage needs of the business. In essence, the cost of operating a cloud-hosted Learning Management System tool can escalate pretty quickly for large organizations with thousands of employees working in a diverse list of departments. For such organizations, it may work out cheaper to pay an annual license fee and handle all eLearning traffic in-house.

On the opposite side of the spectrum are small organizations that do not have a continuous need for eLearning tools. For such organizations, it may work out cheaper to invest in a Learning Management System only for the short duration that it is needed rather than pay a monthly subscription fee for the product. In both cases, hosted solutions may work out cheaper for the businesses in question. There are 2 major capital costs when it comes to hosted eLearning tools - license and installation. In essence, the hosted solution may be a cheaper compared to a cloud-hosted LMS for businesses that have high utility over long periods of time. For most small and medium-sized businesses, however, cloud-hosted Learning Management Systems may make more sense.


Cloud hosting comes with a bandwidth that is scalable. This lets Learning Management System applications of any size to be hosted with minimal investment. But depending on your unique business needs, businesses may want to choose hosted solutions. This is especially true for businesses that have high bandwidth consumption that already has a hosted server for their other business needs. Such businesses may want to save on costs by hosting their Learning Management System on their existing server rather than pay a third party provider for cloud hosting.


This is a tricky area since there is no clear advantage for hosted solutions over cloud-based Learning Management Systems. Most of the major SaaS-based Learning Management Systems including Docebo, TalentSpace, and UpSide come with API integration that allows businesses to customize their Learning Management Systems with unique third-party integration tools. Some large corporate enterprises may, however, have unique integration and customization needs that SaaS-based eLearning tools may not offer. It is worth noting that SaaS-based Learning Management System solutions are built keeping the needs of the majority in mind. A large corporate with unique business needs may not always find a cloud Learning Management System that fits the bill on all the unique needs. A hosted Learning Management System makes sense in such cases.

Dedicated IT Team

As discussed earlier in this article, there are two main capital costs when it comes to installing a Learning Management System - the cost of licensing the software and the installation cost. Besides this, installed Learning Management Systems also require regular maintenance which can cost money if your business does not have a dedicated IT team. An in-house technology team is a fixed cost and may be used for maintenance by large enterprises. But if you are a small or mid-sized enterprise without the necessary in-house IT resources, a cloud-based Learning Management System would make better economic sense.

Hosted Learning Management System solutions are not for everyone, and most regular SMB and enterprise businesses would prefer cloud-hosted Learning Management Systems over hosted solutions. However, under certain circumstances, locally installed Learning Management System products make sense and is still a lucrative option over SaaS-based Learning Management System alternatives.