Sunday, December 27, 2009

Computing in the Cloud

Companies these days are bogged down in mega-servers, storage, hubs, and network connectivity; all necessary evils of keeping any modern business on its toes and ready for battle. But expensive high-tech gadgets are often under-used and quickly outdated. Cloud computing is an alternative to excessive capital investment in IT infrastructure. Think of it as outsourcing all of the in-house hardware to someone operating and paying for them full time “in the cloud”. Instead of owning resources that you do not need, you just access these services via the internet when you do need them. These “cloud providers” can take on knowledge management systems and build infrastructure more efficiently and effectively than their clients. There is no reason for businesses to waste their time and money developing complicated structures that are outside their core competency and do not add to their competitive advantage. The list of services that cloud providers offer is growing in breadth and shrinking in price as they are off-shored to Bangalore and Kuala Lumpur.

The irrelevance of location is certainly a main advantage in this industry. In a world where people can now do business by video, phone, skype, and even tele-presence, the workday stretches far beyond nine to five. Nowadays companies must be on the ball 24/7. Cloud computers can provide fairly reliable access to business services to anyone, anywhere, anytime. Scalability is also key in a volatile global marketplace where demand fluctuates all the time. So it is no surprise that analysts have high expectations for the future of the cloud and its service providers. The market research firm IDC estimates that global spending on cloud services will reach $42 billion in 2012, an increase from $16 billion in 2008.

But many companies are still nervous at the prospect of housing all their data outside the corporate walls. Security is their main concern in choosing a provider. But many do not realize that with the right provider, their data may actually be even safer in the cloud. These providers build their reputation on data security and have invested huge amounts in keeping their clients safe. They are able to leverage the resources and experience to support large and expanding networks. Furthermore, they have the ability to extend customized private connections to companies with sensitive information so much that the cloud is really just an extension of their own network. But the point is to focus company time and money on building a business, rather than an IT department.

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