Moving to the Cloud

(Image Courtesy of mnsc)

Retail has been ‘moving to the cloud’ for a long time: Amazon’s market capitalization had sailed past Target, Home Depot, Best Buy, and Costco by March of 2010, and just a few weeks ago, on July 27th, their market cap passed $100B. Now non-retail businesses and governmental organizations are headed for the clouds. In Forbes Magazine, May 23rd, Microsoft’s CIO, stated that, “Of more than 2,000 CIOs surveyed by Gartner recently, 43% of them predicted that the majority of their IT infrastructure will run on cloud technologies within the next four years.

The migration to the cloud is turning into a macro-cultural shift. Everyone seems to be aware of the cloud computing revolution, but what kind of benefits does it have for website owners? Moving from a dedicated server to the cloud is similar to making the move from a physical retail location to digital retail; there are some huge benefits to be had, but it can be hard to understand and optimize at first. Both digital retail and cloud computing offer more flexibility and quicker response times to user/customer demands, with cloud computing eliminating the need to anticipate user traffic. Digital and cloud models also reduce cost while providing more freedom. Though each service has drawbacks of its own, the shift towards cloud computing will definitely bring about changes similar in scope to the digital retail revolution.

Previously, a business would have to determine their server requirements and purchase hardware or rent dedicated servers accordingly. They would have to attempt to predict changes in their usage and purchase additional servers beforehand, making it difficult and costly to adjust to changes. By pushing their services to the cloud, however, businesses can keep only the resources they need on-hand and adjust their plans based on usage. This enables businesses to react to business changes more quickly and it gives them the flexibility to offer new services without upgrading their infrastructure first, in much the same way that operating a digital retail space allows a retailer to continuously reevaluate their products and judge customer reaction quickly.

Reduced Cost
Dedicated servers require a set cost commitment in return for a specific amount of performance. If a client needs more resources, they have to purchase additional servers and they are not discounted for any unused resources. They are, in effect, paying for the potential use of a server, not the amount they actually use. Just as digital retail eliminates the need to maintain a costly storefront, cloud computing eliminates the need for a company to pay for server resources they don’t use. Cloud providers charge based on the requirements of the client, so small to medium-sized business can save a substantial amount of money by switching over.

The move to the cloud will change the way people use and view servers, much in the same way that the move from physical to digital retail changed the way people view buying and selling. There is no longer a need to anticipate traffic and purchase servers to accommodate expectations, because cloud computing services can be used to scale available resources based on need. Because companies only need to pay for the resources they use, companies can save money on their server needs and still maintain their desired performance levels. The combination of flexibility and reduced cost coupled with the benefits of outsourcing server maintenance open up a new realm of possibilities for businesses. Because they can save money and retain the same level of performance, they are free to expand and offer new services without being forced to perform costly upgrades to an on-site data center. IT no longer has to focus on maintaining servers or performing backups and restorations, freeing time and money for more development. The move to the cloud represents a shift in how businesses look at hosting, giving them a greater degree of control over performance and cost and freeing their personnel and budgets for more business-specific tasks.

Small Business & Cloud Computing
You may ask: this cloud solution all sounds very well and good for businesses in the enterprise space, but what about small businesses? We’ll briefly highlight three major advantages that cloud computing brings to small businesses before closing.

  1. The main advantage of cloud computing for small-businesses is that moving to the cloud will allow you to avoid the sometimes steep cost of investing in physical infrastructure. In these times when credit is hard to come by, moving to the cloud can provide you with an escape hatch to move forward, saving your company from paralysis or heavy-debt.
  2. For businesses under with under 100 employees using business apps, moving to the cloud will reduce your carbon footprint by 90%–netting you significant saving on energy costs! It’s a longterm investment that will net you monthly dividends every month when you go to pay utilities.
  3. No more IT meltdowns! Speaking of utilities, when is the last time the national power grid completely collapsed? Never? Cloud-computing is like a public-utility: it’s software that’s just in the air. The great likelihood is that moving to the cloud will reduce your IT expenses significantly, allowing you to invest in innovation rather than systems maintenance.

The moral of the story is: whether you’re part of large company or a small business, you should consider what the cloud has to offer before investing in your next hardware update!

One Response to “Moving to the Cloud”

  1. reagan Says:

    The main advantage of cloud computing for small-businesses is that moving to the cloud will allow you to avoid the sometimes steep cost of investing in physical infrastructure.