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The True Cost of Video: Calculating the TCO of Self-Hosting vs. SaaS

· 4 min read
Bob Teng
Bob Teng
Developer Advocate

How much does your video conferencing solution really cost? The answer is often more complex than just the number on your monthly bill.

For businesses evaluating a video platform, the choice between a public SaaS provider (like Zoom or Google Meet) and a self-hosted solution (like plugNmeet) often comes down to a calculation of Total Cost of Ownership (TCO). While SaaS pricing seems simple at first, it hides long-term costs that can stifle growth. Conversely, self-hosting has a different cost structure—one that offers predictability, control, and significant savings at scale.

This article will break down the true TCO of both models to help you make a smarter, more strategic decision.

The SaaS Model: A Story of Escalating Rent​

The pricing model for most SaaS video platforms is designed for simplicity and immediate adoption. It's typically a per-user, per-month fee. This is the "rent" you pay for using their service.

The Visible Costs:​

  • License Fees: The obvious cost. For example, $15 per host per month. For a company with 100 hosts, this is a predictable $1,500 every month.

The Hidden Costs (Where TCO Spikes):​

  1. The Penalty for Growth: The per-user model means your costs scale directly with your success. As you hire more employees or serve more customers, your bill goes up in a linear, often painful, way. You are penalized for growing your business.

  2. Overage Charges: Many plans have limits on meeting duration or number of participants. Exceeding these can result in expensive overage fees.

  3. API & Integration Fees: Need to integrate the video service with your CRM or scheduling tool? Many providers charge extra for API access, sometimes at a steep per-minute or per-call rate.

  4. Lack of Brand Equity: This is a strategic cost. Every time a customer joins a meeting, they see the SaaS provider's brand, not yours. You are paying to build their brand recognition, not your own.

The SaaS TCO is a recurring operational expense (OpEx) that is unpredictable and scales with your user count.

The Self-Hosted Model: The Power of Ownership​

A self-hosted platform like plugNmeet flips the cost model on its head. Instead of paying rent, you are making a capital investment in an asset you own and control.

The Visible Costs:​

  • Infrastructure: The primary cost is the server hardware (or virtual machine) where the software runs. This could be a cloud server from a provider like DigitalOcean, AWS, or Azure, or your own on-premise hardware.
  • Initial Setup: A small, one-time investment of engineering time to install and configure the platform.

The Long-Term Savings (Where TCO Shines):​

  1. Predictable, Fixed Costs: Your main cost is the server, which is a predictable monthly or annual fee. Whether you have 10 users or 1,000 users, this cost does not change. You can serve more users for the same price, rewarding your growth instead of penalizing it.

  2. No Per-User Fees, Ever: With open-source software, there are no license fees. You can add as many users, hosts, and rooms as your hardware can support without your bill going up.

  3. Full API Access Included: All APIs and webhooks are included. You can build deep, complex integrations without worrying about metered billing for API calls.

  4. You Own the Brand: Every meeting reinforces your brand, building customer trust and brand equity. This is an invaluable marketing asset.

The Self-Hosted TCO is primarily a predictable infrastructure cost that remains flat as your user base grows.

A Simple TCO Comparison​

Imagine a company with 50 hosts.

  • SaaS Model: At $15/host/month, the cost is $9,000 per year. If they grow to 100 hosts, the cost doubles to $18,000 per year.

  • Self-Hosted Model: A capable cloud server might cost $80/month, totaling $960 per year. If they grow to 100 hosts, the cost remains $960 per year (assuming the server can handle the load, which a modern server often can).

The savings are not just significant; they are exponential as you scale.

Conclusion​

Choosing a video platform is a long-term strategic decision. While the immediate simplicity of SaaS is appealing, its rental model can become a significant financial burden that limits growth and brand control.

Self-hosting with a platform like plugNmeet requires a small upfront investment in setup, but it pays massive dividends over time. It provides a predictable, scalable, and strategically sound financial model that puts you in control of your costs, your brand, and your future.

Ready to take control of your video conferencing budget?