Friday, March 25, 2011

Low Budgets and the Demand for Cloud Solutions

Last year, IDC has reported that the server hardware revenue for public cloud computing will grow from $582 million in 2009 to $718 million in 2014, and from $2.6 billion to $5.7 billion in the same time period for private cloud market. This proves that many organizations are considering putting infrastructure into data centers while opting for software as a service. And it comes as no surprise when one considers the advantages cloud services offer to small and medium-sized enterprises (SMEs/SMBs) whose budgets are tight yet still want to secure their network and take advantage of the latest technologies.

Among these advantages are:

  • No need to invest in security software or hardware – Rather than going for an upfront investment, all you would need to do is simply pay for the service on a pay-per-use or rental basis. This is great, especially for small businesses whose revenue is low, as it would increase the ROI by saving them money which would have been spent on software or hardware. 
  • Network security at low costs – Although software as a service is the cheaper option, it does not mean that cloud computing security does not offer equally solid safety as an on-premise solution. The difference is that while in an on-premise solution corporate data is controlled internally, in the case of a hosted solution the data goes through third parties. Today this isn’t considered as an issue; four of the largest 10 banks in APAC, for example, report that in the following months about 30 to 50 percent of their application will be moved to hosted services. Cloud computing is therefore a great opportunity for your organization if you would like to secure your network even if your budget is low. 
  • No licensing and renewal costs – Software licensing costs are usually expensive for start-ups. This is not required when using a cloud service. Furthermore, software companies usually update their solutions, meaning if you are using an on-premise solution you’ll need to renew it every so often. Again, a hosted service saves you this trouble as it takes care of such updates itself while providing you with the latest service.
  • Third parties are doing the hard work – Instead of worrying about increasing your infrastructure through IT staff with good technical know-how to maximize benefits of your IT systems, meaning more expenses, cloud services provide you with the best resources without requiring any work in this field from your side.

Clearly, cloud computing is becoming increasingly beneficial for SMEs who wish to make the best out of the technology available today on a low budget. Does this eliminate on-premise solutions? Not necessarily; experts see a bridge between the two in the form of a hybrid solution where some functions will move towards the cloud while others will still be based on internal computing. While the three solutions are available, hosted services remain the ideal for organizations with a tight budget.

Additional Readings

This guest post was provided by Christina Goggi on behalf of GFI Software Ltd. GFI is a leading software developer that provides a single source for network administrators to address their network security, content security and messaging needs. More information: Hosted Email Security.

All product and company names herein may be trademarks of their respective owners.

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  1. Suddenly, companies spending so much on such things as server housing and data cabling doesn't sound so bad, especially if cloud computing is involved. This is one case where the rewards outweigh the risks.

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