Cloud Computing: for Enterprises or SMBs?

Friday, October 03, 2008

The transformation of free Web- based applications like email, office suites, and even individual user desktops for consumers to commercial SaaS based solutions for small and medium businesses took very little time. We've barely become used to these buzzwords that another one is already staring us in the face: cloud computing. But is it really 'just another buzzword', or a disruptive technology in the making?

Given that so far, the Internet has delivered on many of its promises for the enterprise community, like Web 2.0, social networking, instant messaging, online collaboration, etc, it would be safe to presume that cloud computing can't be taken with a pinch of salt. At the same time, we can't just blindly follow a trend. So let's analyze cloud computing and what it can offer to enterprises.

The first benefit of cloud computing is cost. You get an unlimited IT infrastructure as a service. The cloud shrinks or expands depending upon your requirement, and you pay for what you use. It's like electricity. You pay for what you consume. While a low cost service like this always attracts SMBs, it's not as if enterprises don't like saving costs. If they can get their IT infrastructure given to them as a service, sans the hassles of maintaining it, and at attractive price points, then why not?

Anil Chopra, Editor anilc@cybermedia.co.in

Another benefit of cloud computing for enterprises is faster time to market for their products and services. The traditional approach to launching a new product in the market is to procure the hardware and software, setup the OS and applications on it, and then start developing the application on it. It's like digging a well every time you want to drink water. With cloud computing, you get the well, along with the water. You just have to pay to fetch this water in the quantity you want, and pay the service charges.

Given these benefits, should organizations jump on the cloud computing bandwagon? Sure, but without forgetting the standard parameters of procuring any product or service. Is the service provider reliable and a long term player? What kinds of SLAs can be setup? If you're going to entrust your business critical applications to the cloud, then standard SLAs that simply offer compensation for downtime won't be effective. You have to equate downtime to the business losses you incur, and then work out the compensation. Security is another concern. Suddenly, all your business critical data goes to the service provider. Can you afford to do that?

Lastly, cloud computing is still a relatively new trend, so the service provider model may not gel well with large enterprises. They already have large data centers, so maybe they'll convert them into a cloud computing infrastructure. After all, cloud computing is just another scalable and efficient data center-something you've always wanted your data center to be.
We've explored cloud computing in more detail in our cover story this time, along with a lot of green technology for data centers and buildings.

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