Cloud computing allows users and businesses to access computer data and applications over the Internet instead of having to maintain and operate them locally. While the concept has existed for decades, cloud computing has grown in popularity in recent years due to improved broadband connectivity. There is still confusion around the term, but it essentially means hosting applications and data remotely on servers maintained by third-party providers, rather than locally. For many smaller businesses, cloud computing provides a cost-effective way to access necessary applications without the expense of hardware, software, IT staff and other local maintenance requirements. However, larger companies may still find it more economical to host certain applications in-house depending on their specific needs and resources.

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You could be forgiven for thinking that cloud computing is a fad. After all,
applications like Dropbox, iCloud, Google Drive, Evernote and Box have been
around for less than five years. But according to Lannick’s director of technology
Igor Abramovitch, cloud computing has been around as long as the Internet.
Some sources like Wikipedia trace the concept back even further.
So why is it so popular now? Says Abramovitch, “Cloud computing is more
feasible from a user perspective due to improved internet access, so it’s more
popular because of the evolution of tools and broadband connectivity.”
What’s in a Name?
But what exactly is cloud computing? You’d think that the term might be better
understood by now. However, in a 2011 study commissioned by Microsoft Canada
and conducted by Leger Marketing, 67 per cent of Canadian C-suite executives
polled who weren’t currently using cloud-based services said they didn’t “know
enough to make major decisions about it.” Add to that 19 per cent of Canadian
businesses that thought they weren’t using cloud services and were in fact doing so.
A visit to InfoWorld, whoseTwitter bio reads, “The leading website for IT managers
and business users to help them modernize IT and leverage new technologies”
provides some answers.
In their article, “What cloud computing really means,” editors Eric Knorr and
Gale Gruman tackle the confusion head-on: “As a metaphor for the Internet,
‘the cloud’ is a familiar cliché, but when combined with ‘computing,’ the meaning
gets bigger and fuzzier.”
Cloud
Computing 1.0

2. So how do Knorr and Gruman define what has been dubbed the “next big trend”?
“Cloud computing comes into focus only when you think about what IT always needs:
a way to increase capacity or add capabilities on the fly without investing in new
infrastructure, training new personnel, or licensing new software. Cloud computing
encompasses any subscription-based or pay-per-use service that, in real time over the
Internet, extends IT's existing capabilities.”
For Abramovitch, cloud computing boils down to this: “It means a business can choose
not to host their own applications, such as e-mail, websites, an ERP system or internal
software. Cloud computing allows you to host them elsewhere, paying another company
for the headaches of scaling, supporting, securing, and backing up the data.”
Up in the Cloud
Cloud-based services fall into three broad categories – applications, storage services,
spam filtering. Within these categories there are a host of offerings available from small
and large providers. There are public, community (shared by a number of organizations),
hybrid (a mix of two or more clouds), and private clouds, which can be tailor-made for a
business’s needs. Given all these options, you’d think every business would be jumping
on the cloud computing bandwagon. (And, in fact, according to the Microsoft survey
mentioned earlier in this article, “80 per cent of business leaders felt that cloud computing
was of vital importance to their business.”) But there are important pros and cons worth
considering, says Abramovitch.
To Cloud or Not to Cloud
If you work for a large company, it’s easy to take a basic service like e-mail for granted.
But if you’re a small- or mid-size organization, in-house e-mail involves a number of
costs, such as staff, hardware, software, security and connectivity. Other services
required to run a business successfully will also result in expenses. This is where
cloud computing can come in handy.
The pros? For a monthly price (typically on a per-user basis), a business doesn’t have to
worry about hardware and software fees, security or backups, uptime worries, and most
importantly – having the right internal staff to maintain and secure the application(s).
Having another company host these services eliminates stress, if, for example, a cloud
service such as e-mail goes down. A third-party vendor can provide peace of mind for a
company by offering reliable and secure access to the application(s) via ever-expanding
broadband internet connections, from anywhere in the world! The vendor would also be
an expert in hosting and maintaining the application(s), so that the company using the
application does not have to be.This allows the company to focus on their main business
activities, rather than also having to develop and maintain expertise in hosting the
software they use.
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3. The cons? Companies lose some control in managing their applications. “Now the
vendor has physical control of the applications,” says Abramovitch. It’s also difficult to
customize applications when you’re working with a third party, plus customization takes
longer. “Cloud computing works really well for small- to medium-size businesses.
It’s very attractive from a cost perspective,” he says.
However, not all companies may be better off choosing cloud computing, especially
since size does matter. For example, if a business has 2,000 users, it could be looking
at a user fee in the hundreds of thousands of dollars, depending on the vendor. It might
be more economically feasible to keep services in-house, depending on what the
business needs are. Larger companies tend to have larger IT departments with larger
hardware/software/staff budgets. It may be easier for them to absorb costs related to
hosting their in-house applications and services, rather than outsource the application
and pay more.
But there are exceptions. Case in point: Dundee Precious Metals (DPM), a Canadian-
based international mining company with more than 2,100 employees worldwide.
In order to maximize its underground Wi-Fi capabilities and meet mobility and security
needs, DPM invested in a Microsoft private cloud solution that’s based on System
Center and Windows Server Hyper-V.
Ultimately, how a business embraces cloud computing will depend on its requirements
and resources. Says Abramovitch, “At some point, people and companies have to do
a feasibility study about whether cloud computing is cost-effective and aligns with
business needs.”
One thing seems clear, though: like its digital cousin, the Internet, cloud computing is
here to stay.
Igor Abramovitch, is Director of Technology of Lannick Group of Companies, which has specialized
in matching qualified professionals with qualified companies for more than 27 years.
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