Your trusty old office computers are likely chugging along with the power of a 20-year-old Oldsmobile climbing Mt. Everest, gamely working hard to complete ever more complicated and varied tasks for your company's employees. But while it might be time to replace the outdated PCs, with today's credit crunch, you may be considering alternatives to simply buying new hardware as a way to save your business money.

So should you lease new hardware, forgoing boxed software? Or try the new cloud computing solutions that are being touted as the next big thing? We'll look into a variety of options for your business and let you know which ones will save you money, and which could potentially cost you big.

Leasing vs. Buying: Good Deal or Bad Idea?

According to a 2007 study by IDC, cutting your PC's life cycle to three years, versus five or six years, will save you on the overall cost of maintaining that system. As presented in the study, keeping two generations of leased desktop PCs (held for three years each) is 20.5 percent less expensive than buying and holding one machine for six years.

Lifecycle implications aside, there are other considerations to mull over before signing a hardware lease, such as end-of-lease costs and other fees that can accrue if not monitored, according to Joe Loiselle, Vice President of Global IT Advisory Services at IDC.

"Leasing is not a bad thing, if you manage it. Unmanaged, it will be a big liability. Most [leases] favor the lack of discipline a buyer has, and most favor a mobile device--it moves, breaks, and changes hands," he says. Unless you are going to send back the equipment on time and address end-of-lease issues, Loiselle believes that your organization is going to bleed cash. Most people don't pay attention to a lease once they sign it, he adds, and lease agreements aren't exactly designed to save you money in the long run.

"Companies are making a mass exodus from leasing," says Loiselle. Leasing "is a Venus flytrap: it's tough to get into and tougher to get out of." Of course, given today's credit crunch, it will be more difficult to get a lease or financing in the first place.

When it comes to servers, it can be even more difficult to return equipment, as data, applications, and network connections are all affected when you remove a server. Servers are not as easy thing to rip out of your network, and most small businesses don't have redundancies in place, according to Loiselle.

A final consideration before signing a lease: Businesses are often able to write off as much as US$15,000 for new equipment, so it may make sense to buy the equipment outright. Be sure to check with your accountant or tax preparer before making a move to either option.

Cost Comparisons: Is Leasing Cost Effective?

We looked at lease deals on three computer manufacturers'

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