An Introduction to Cloud Computing

IT is expensive – if you want to run the latest and greatest technology achievements in house, you need a lot of money. Hardware equipment costs a fortune and it gets old so fast that even rich companies can't afford to keep pace with the rapid technological advancements. On the other hand, even if you can afford to buy this expensive equipment and your volume of work drops, the money you invested is wasted. Even in times of economic boom volumes of work do drop, unexpectedly at that, so spending millions on equipment is rarely a wise investment. Wouldn't it be more reasonable if companies could share their equipment – i.e. lend free resources when they have them and borrow additional capacity when they need? Yes, it is more reasonable to do it and in fact it has already been done – under the name “cloud computing”.

What Is Cloud Computing?

Cloud Computing

There are many definitions of cloud computing but basically they all state that cloud computing uses resources, shared over the Internet to perform on demand computational tasks. To put it simply, a cloud computing vendor buys the necessary hardware and software, builds the necessary infrastructure and offers these capacities over the Internet for fee to anybody who needs them.

The idea is that this way the cloud computing vendor manages to earn more than when the equipment is used solely for internal purposes. Additionally, depending on the particular clauses in the contracts, it is quite possible to arrange that this equipment/infrastructure is leased only when it is not needed internally - i.e. if you need it internally, you are not bound to share it with other companies.

Cloud computing comes in many forms and one of the most popular is SaaS (Software As A Service). The SaaS model uses not only the equipment and infrastructure of the cloud computing vendor but it also includes software applications as part of the package. PaaS (Platform As a Service) is another popular form of cloud computing. In regards to hosts offering this form of hosting we have created a list with what we believe to be the best cloud hosting providers on the market today. Our editors have taken things such as price and reliability into accounting when ranking the providers.

How Can a Company Benefit from Cloud Computing?

Cloud computing wouldn't have become that popular, if it didn't have many advantages for all parties concerned. In a sense, it is a win-win deal. For the cloud computing vendor the benefits are that the existing infrastructure is better utilized and it generates additional revenue rather than stay unused. For the companies that use cloud computing services the benefits are also tangible and some of them are:

  • Lower costs. This is the most obvious benefit - you use the equipment/infrastructure you need without having to buy it. Even if the rental fees are high, unless you use the cloud infrastructure heavily, the savings for you are substantial. Actually, you pay only for what you use. On the other hand, if you use cloud computing services frequently, maybe it is better to build that infrastructure in house than to rent it.
  • No need to have dedicated IT experts for the maintenance of the infrastructure. In addition to the fact that you save money because you don't have to buy the equipment, you also save because you don't have to employ dedicated IT experts to install and maintain this infrastructure. Installation and maintenance costs could surpass the cost of the equipment itself and that is why not many companies can afford to keep dedicated IT staff on payroll.
  • Saves time. Finally, when you don't have to waste time on installation and maintenance of equipment and infrastructure and you just use the capacity you need, this saves a lot of time and contributes to your increased efficiency. Time is money, so why waste it on maintaining an infrastructure, when you can rent it?

Are There Any Downsides Related to Cloud Computing?

To a manager, who is always pressed by time and money constraints, cloud computing might look like a dream come true. In a sense, this is so, because cloud computing offers so many benefits but on the other hand, cloud computing is not bug-free and here are some of its downsides:

  • Security. When cloud computing is concerned, security is the main issue. When confidential data travels over the Internet and is stored at third party premises (i.e. the premises of your cloud computing provider), there are many factors outside of your control. For many managers these potential security risks are a major reason why they say "No" to cloud computing. Of course, if security is properly taken care of, cloud computing is a safer option than in-house data storage.
  • Might not be available when you need it. While cloud computing vendors generally try to maintain uptime above the industry average, nobody is insured against outages. Well, outages happen in house too. The more important is how frequently these outages happen and how soon the infrastructure is back up again. With a reliable cloud computing provider, outages might not happen for a long period of time and even if they do, they are short, while if you have an in-house outage, even if you mobilize all your experts, it will take longer to restore operations.
  • Quality. Downtime and security are just too of the concerns regarding the quality of cloud computing. Since you don't have control over the infrastructure of the cloud computing provider, you might be surprised by their low broadband, slow computers, and rude staff. Needless to say, if you choose a good cloud computing provider, you shouldn't have to face such issues. In a sense, quality concerns are not related to cloud computing itself but more to the cloud computing vendor you choose.

In this relation it makes sense to point out that the downsides of cloud computing can be easily overcome if you select the right vendor. When choosing a cloud computing vendor, price should be your last concern - reliability and professionalism are much more important and if you save on them, then you shouldn't complain that cloud computing doesn't work for you. Cloud computing is great but only when you have picked up the right vendor.

If you're interested in Cloud Computing you might also want to check out Virtual Private Servers.

Written 2009-11-19 (Updated 2016-10-12)

Chad Bean

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