Cloud Computing: Business Perspectives and Benefits

Recent statistical data shows that over 90 percent of firms want to migrate to the cloud platform over the next four years. The same tendency to use cloud-based solutions instead of a traditional hardware has a place in many areas of business and governance. What are the key factors behind this industry transformation, and what are the major benefits of cloud computing? This article will help you understand what the cloud is and support you in investigating why cloud solutions can be a good choice for your company. Its main objective is to outline the biggest advantages of cloud computing.

What is cloud computing?

Thanks to virtualization technology, it became possible to combine various Internet servers into single clusters with almost unlimited performance. In addition to high reliability, such clusters allow you to optimize the load on each server, and, therefore, significantly reduce the cost of computer resources. Cloud computing gives you access to virtualized IT resources such as servers, storage, databases and a broad set of application services.

Here are the main uses of Cloud Computing:

- IaaS (Infrastructure as a Service) - cloud platforms which enable you to rent a bare Windows / Linux server with scalable power. Examples: Amazon Web Services, Rackspace Cloud.

- PaaS (Platform as a Service) - cloud platforms with all the necessary middleware and auxiliary software (DBMS, framework, services). Examples: Windows Azure, Force.com.

- SaaS (Software as a Service) - business applications delivered as Internet services. Examples: Google Apps, Salesforce CRM.

Private Cloud

Some companies want to take advantage of Cloud Computing, but they are afraid to host their IT infrastructure on other users’ servers. In order to describe a new computer reality, creative IT professionals came up with the term “private clouds.” Actually, in practice, a company buys servers and, while using virtualization technologies, combines them into the so-called “clouds”. The cost benefits of using the cloud technology are possible thanks to optimizing the load on each server. At the same time, this effect is not comparable with the option of renting computer resources from a third-party provider.

Importantly, cloud computing operates on a similar principle as web-based email clients. In other words, it functions by allowing users to access all of the features and files of a system without the need to keep the bulk of that system on their own computers. In fact, most people already use a variety of cloud computing services without even realizing it. Gmail, Google Drive, TurboTax, and even Facebook and Instagram are all cloud-based applications. As they utilize all these services, users are sending their personal data to a cloud-hosted server, whose job is to store the information for users’ later access. And as useful as these applications are for personal use, they're even more valuable for businesses in need of accessing large amounts of data over a secure, online network connection. For example, employees can access customer information via cloud-based CRM software, like Salesforce, from their smart phones or tablets at home or while traveling. They can then quickly share that information with other authorized parties anywhere in the world.

Still, some leaders remain hesitant about committing to cloud-computing solutions for their organizations. That is why, we’d like to take a few minutes and share the main business advantages of cloud computing.

The business advantages of cloud computing

Cloud computing is a good option for both startups and well-established market players. Many companies have already shifted to cloud. When giving explanation for making this choice, they usually cite cost, scalability, and data integrity as the top three drivers. Still, for many firms, “cloud” remains to be a long-term ambition rather than a present-day option. According to recent data, only 25 percent of enterprise users are ready to use cloud technology for the majority of their market data needs. Yet, the demand for cloud is on the increase. What can explain such demand in the present market? 

First, as a cloud user, you are free to carry out all sorts of experiments with your technology. Also, you can quickly validate changes with the help of cloud computing and avoid extra costs associated with the need to renovate your hardware. Yet, the major benefit of cloud use lies in the mode of data input. This is a very important attribute of a modern market given its demands for high-quality data. In addition, the platform with cloud services provides rapid access to highly flexible and low-cost IT resources. It helps launch applications or manage critical business operations. Only a single payment – and almost instantly you can access all your resources.  

One more benefit of cloud services platforms is that you can control both type and size of computing resources necessary for managing various business operations. Needless to say, these advantages of the cloud technology make it one of the fastest and frequently changing digital technologies of the present that can solve many problems, one of them being the excessive reliance of many companies on user-owned hardware. As a result, subscription-based cloud services become an option for many users. Same applies to big enterprises. Recent statistics show that these days public-cloud infrastructure market leaders control about 80% of market, which is valued over $32 bn:

1. AWS (47.8%)

2. Microsoft (15.5%) 

3. Alibaba (7.7%) 

4. Google (4%)

5. IBM (1.8%)

Cloud Computing provides financial benefits like money savings and increased productivity. 88% of cloud users experience cost savings while 56% of them have seen a big increase in their revenues. Almost all of them utilize hybrid (Private/Public) cloud computing services – the best option for running multiple business operations. Based on the results of a study by the global communications research provider CenturyLink, the cloud computing market is forecast to reach $411bn by 2020 (weeksnews.org 2020 cloud computing forecast 2020).

Cloud Computing Benefits

Of course, cloud computing does not work with every application, yet it has been recognized that either partial or complete transferring of IT operations from the localized infrastructure to the cloud can bring the following set of advantages:

Reductions in original investments

When one decides to switch to cloud computing, one will discover that the biggest part of the budget will cover the range of operating expenses rather than preliminary capital costs. Therefore, if you choose cloud computing, you will be able to begin work immediately along with implementing new initiatives without having to fund costly data centers.

Economic efficiency

Online scaling of resources within the cloud can help make significant savings for both small and large enterprises. As a matter of fact, the providers of cloud services utilize the equipment with maximal efficiency and maximal load. It is this advantage that allows them to save energy as well as other resources and prevents them from raising prices for customers.

High flexibility of resources

Not only do cloud computing resources scale well, but they are also exclusively flexible. This means that during the periods when the demand is at the low level, you can easily reduce the amount of resources used and, consequently, reduce costs.

Ease of use and convenient maintenance

With the introduction cloud computing, the deployment of resources and updates becomes automatic, and it also becomes standardized. This advantage increases availability. Besides, it effectively eliminates any existing inconsistencies. Manual updates are no longer necessary. In addition, you will not need to make sure that your specialists will perform physical server maintenance or ensure that they are present in the data center.

Simplified innovation

Cloud computing, among other advantages, simplifies the development of various innovative solutions, both within teams of IT professionals and across the whole company. Once IT professionals become free from the task of building and installing new systems in order to accumulate resources, they get the opportunity to work out and implement improvements to the existing business processes, which brings about far-reaching effects. At the same time, the company’s managers are now able to supply resources for needed pilot programs quickly and without spending a lot. They can later increase and reduce these expenses without the need for detailed planning of infrastructure or without preliminary long-term investments.

Improving business continuity

Given that the cloud computing infrastructure is all virtual, you can make the processes of creating copies of data automatic. Same applies to operating systems. Besides, you can launch the initialization of failover procedures. This makes it possible to improve data protection and increase data availability in comparison with local systems.

Flexibility

You can innovate faster. In particular, you will focus your efforts on working out IT resources for applications paying attention more attention to customer service. Besides, you will focus more on infrastructure management along with centralized data processing. As a result, you will accumulate resources quickly and efficiently.

Moreover, the cloud provides easy access to a broad spectrum of technologies. Among them you will find computing services, storage services, database services, analytics, machine learning, and many others, as needed. Hence, you are able to quickly develop and deploy new applications while your specialists focus on experimenting more often and implementing innovations faster. In case of failure, you can always free the allocated resources knowing that you do not risk anything.

Elasticity

Under the conditions of emerging excess infrastructure resources, cloud computing helps ensure that these resources are sufficient to carry out business operations at peak loads. It is owing to cloud computing that you are now able to allocate the amount of resources that is really required. This approach helps instantly increase or decrease the resources scale in accordance with the needs of your business. Needless to say, the elasticity of cloud computing reduces costs and leads to improved user experience.

Reducing costs

By using the cloud, you can turn your business’s capital expenditures (on data centers, physical servers, etc.) into mere variables. Hence, you will only pay for those IT resources that you use. In addition, variable costs are seen as significantly lower due to the existing economies of scale.

Global deployment in minutes

Thanks to the cloud, you can deploy with ease your applications to multiple physical locations around the world, with making just a few clicks. In this way, latency level becomes lower, and better customer service can be achieved without difficulty and at minimal cost.

Types of Cloud Services

Infrastructure as a Service (IaaS)

This is the most basic form of cloud computing offering users a range of basic infrastructure components, such as space in the north, data storage, and network components that can be utilized through the API. This model resembles the way in which a traditional data center is implemented within a hosted environment.

Software as a Service (SaaS)

SaaS applications are designated for end users; that is why all infrastructure deployment and development processes are made invisible to them. SaaS applications offer the widest range of features in the cloud, from business applications, including but not limited to word processing programs and spreadsheets, to customer relationship management, photo editing packages and platforms of video hosting.

Conclusion 

To sum up, while they effectively preserve the ongoing business transformation initiatives, virtualization and Cloud Computing can be used for meeting cost-cutting objectives of each individual enterprise. Developers agree that state-of-the-art cloud technology has already reached its so-called “maturity” and can be considered a reliable technology. These days, the technology offers a good potential as a digital transformative power. At the same time, developers agree that this potential has still been underused. Overall, the cloud-based collaboration approach helps companies accelerate.