Hosting and Connectivity

This is the term I use in my chart of accounts for expenses associated with cloud computing and datacenter operations, infrastructure service providers, cybersecurity, and related software. SaaS companies relying solely on third-party cloud provides, such as Amazon Web Services, Azure or the Google cloud Platform (GCP), pay for (1) servers for processing and storage; (2) internet connectivity; and (3) software that provides security, control, and monitoring services. Those SaaS companies that manage their cloud environment internally will also have depreciation and amortization for hardware and software acquired for this environment.

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