The Definitive Guide to Cloud Computing for Businesses

Dan Stelter| Technology-digital

Cloud computing and its related business lines are exploding. Three of the world’s leading information technology research companies agree: International Data Corporation predicts global revenue for public cloud services will hit $73 billion by 2015, Gartner estimates the market will be worth $150 billion by 2014 and Forrester believes cloud services will be worth $241 billion by 2020. Compare these estimates to the $40 billion estimated revenue generated by the cloud computing industry in 2012, and you see why there’s so much buzz. While the revenue estimates vary widely, the takeaway is the same: The industry will continue to grow at an explosive pace.

Behind the Cloud’s Growth

There are a number of reasons that cloud computing for business is growing at a monumental rate:

Big data makes for big growth. To say there’s been a dramatic increase in the amount of data being generated as a result of the Internet is putting it mildly. At the 2010 Techonomy conference at Lake Tahoe, then-Google CEO Eric Schmidt put it in perspective this way: “There was five exabytes of information created between the dawn of civilization through 2003, but that much information is now created every two days, and the pace is increasing.” (An exabyte is a unit of information equal to one quintillion bytes, or one billion gigabytes.)

Now, debate exists as to whether that calculation is accurate – it may actually take seven days – but you get the point: We generate a massive, mind-blowing amount of information, at an exponentially higher rate than at any other time in history. This fact has created a need for business solutions that synthesize, analyze, process and store big data.

Increased mobility. If you already use cloud services, then you know that mobility is one of its greatest characteristics. People can work from anywhere there is Internet access, and they don’t need to lug around a laptop to do so – they can access their company’s network via a third party PC or, more likely, a tablet or smartphone. In fact, a new survey conducted by the business technology group CSC found that accessibility to information through mobile devices was the biggest reason businesses adopted cloud computing.

Cost savings. Experts agree the cloud reduces IT infrastructure costs for small and medium-sized businesses, especially startups. Some of the savings include:

  • Expenses required to purchase technology and applications and keep them current
  • Maintenance expenses associated with fixing software and hardware
  • Employee salaries required to maintain networks
  • Hidden costs, such as the cost of recruiting IT employees and the facility and heating, ventilation and air conditioning costs associated with maintaining a network

Infrastructure flexibility. Although cloud technology doesn’t magically make most of your IT hardware disappear, it does offer more flexibility for your organization’s technological demands. Many businesses have found that using a hybrid of public and private cloud computing solutions provides the right mix of security and cost savings, and therefore the flexibility they need to continue growing.

Obstacles to Adoption

Some businesses aren’t convinced that cloud computing will bring in the promised cost savings. There’s a misconception that goes something like, “Everything is hosted on someone else’s hardware, so there’s  virtually no need for internal IT staff.” Many businesses find out that isn’t the case.

Migration costs, employee training, occasional downtime, accurate bandwidth estimation and protection of information costs can be either forgotten in the total estimated cost or difficult to project. Although the cloud cost savings is often exaggerated, companies who take the time to carefully analyze the areas where the cloud functions most effectively do realize savings.

A second and much more prevalent concern is security. Smart IT managers question the security of the public cloud, as data stored there is more susceptible to hacking and viruses than private cloud data. One of the primary cloud computing challenges businesses face is middle managers who don’t want to spend money on the increased security of a private cloud and then get bogged down in contentious relationships with IT security managers. In reality, companies with security concerns often find that public cloud security is no more or less effective than the security in their own networks.

Finally, many businesses do find that the bandwidth they currently have simply isn’t sufficient for integrating the cloud into their existing IT infrastructure. For these businesses, integrating the cloud will be a considerable challenge, and one that may work best via a gradual, step-by-step process.

The Role of Mobile Devices

The proliferation of mobile devices among consumers and employees raises some interesting points about how tablet and smartphone technology integrates with the cloud. Morgan Stanley investment guru Mary Meeker predicted that by 2014, more people will access the Internet via mobile devices than PCs. Companies using the cloud are able to provide connectivity to their employees via the employees’ mobile devices, prompting some workplaces to enact bring-your-own-device (BYOD) policies. While BYOD raises some security concerns, it’s become a primary driver of mobile networking growth. Cloud services have responded by configuring access to data over a variety of common Internet connections, and most providers have iPhone and Android mobile apps for data access.

Early Adopters Have an Edge

The general consensus is in: The Digital Age is moving into the cloud. Moving your business to cloud technology won’t instantly transform it into an ultra-efficient market leader, but the business leaders of yesterday who made the switch are realizing substantial and long-term returns on their investment. It may be just the edge your business needs.


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