Data storage and information management are software essential to success for companies both big and small. In many cases, business data is stored in-house in an IT infrastructure. However, as businesses mature and evolve in the Internet Age, more and more companies are moving to leverage cloud software to keep up with 21st century needs.
Cloud computing isn’t a new concept but it’s a technology that is revolutionizing the way companies do business. Keep reading for our cloud software explainer and why companies may want to consider adopting this unique technology.
What is the cloud?
The cloud refers to both services and software that run over the internet, rather than on your personal computer . Cloud services can usually be accessed through different kinds of web browsers such as Chrome or Firefox.
Some examples of cloud software you might be familiar with include Dropbox, Google Drive, or Netflix.
What are the different categories of cloud computing?
There are three main models of cloud computing that companies can use: Platform as a Service (PaaS), Infrastructure as a Service (IaaS), and Software as a Service (SaaS) .
Platform as a Service (PaaS)
PaaS allows web developers to build and use customized applications through a framework provided by the cloud platform service. All of the networking, storage, and servers can be managed and maintained by the company or the third-party provider while developers remain responsible for the management of the actual applications.
Typical characteristics of PaaS:
- Simple, budget-friendly way to develop and deploy apps
- Easy to scale
- Reduction in amount of coding necessary to develop apps
- Apps can be customized without needing to maintain and manage the software behind it
Examples of PaaS include Google App Engine, Apache Stratos, and Windows Azure.
Infrastructure as a Service (IaaS)
IaaS is a highly scalable way to provide users with virtualized computer resources. With IaaS, companies can monitor and access computers, networking, storage, and other services. IaaS allows companies to buy resources as needed instead of being forced to buy specific hardware and then downsize or scale up later.
Typical characteristics of IaaS:
- Resources accessible as a service
- Multiple users can use a single piece of hardware
- Cost depends on consumption of resources
Examples of IasS include Microsoft Azure, Amazon Web Services (AWS), and Digital Ocean.
Software as a Service (SaaS)
This is probably the most common type of cloud service that businesses use. SaaS leverages the internet to deliver applications to users. These applications are managed by third-party vendors. Many SaaS apps are run directly through a web browser so they often don’t require downloads or installation on the user side.
Typical SaaS characteristics include:
- Centralized hosting location
- Remote server
- Can be accessed through an internet connect
- Users don’t need to manage updates for software or hardware
Examples of SaaS include: GoToMeeting, Salesforce, Dropbox, and Google Apps.
Why is it called cloud computing?
Although “cloud computing” immediately conjures up images of white, fluffy cumulus formations, cloud software doesn’t mean your data is off somewhere in the sky. Instead, cloud computing refers to the underlying purpose of the cloud: your data isn’t stored locally on your computer or local IT infrastructure. Instead, its location is off-site accessible through an internet connection.
Interesting fact: The cloud metaphor arose out of old telecommunications network plans where the public telephone network was symbolized by a cloud image to show the location was irrelevant.
What is the history of cloud computing?
Cloud computing has been around since the 2000s, but the idea of computing-as-a-service has existed since the 1960s when computer companies or universities would let businesses rent time on their computer mainframe. In turn, this meant that businesses didn’t have to purchase their own computer hardware.
Building IT infrastructure to support cloud services now makes up more than a third of IT spending around the globe.
What are the benefits of cloud-based software?
Cloud-based software is a lot more than just off-site data storage. It’s a whole new way for businesses to scale their new products, respond to changes in the market, and reduce the need for an in-office IT work force.
Here are some of the reasons why a growing number of businesses are adopting cloud services.
1. A greener choice
When the storage needs for a company change, a cloud server’s capacity can easily be altered to reflect the new needs. In terms of energy use, this means that companies only use the energy currently required. In the past, companies would have to plan ahead with an oversized amount of storage in order to hedge their bets for future scaling. The result? With cloud storage options, companies can avoid footing the bill for unnecessary IT infrastructure.
With cloud computing, you can scale up or down, without being beholden to the expenses involved in maintaining, updating, and using large amounts of IT hardware for company data.
2. Staying competitive
Another great bonus of using cloud software is that it enables smaller companies to benefit from enterprise-level tech. It also gives small businesses the chance to be nimbler and keep up with big brands and competitors.
Typically, using a cloud services means that companies aren’t forced to pay a huge upfront cost. However, whether or not cloud software will affect a company’s bottom line will depend on the type of cloud service and the company’s rate of consumption of those services.
With that said, companies may be able to circumvent the need for IT staff all together or significantly reduce an IT team’s size by using cloud services.
Business laptops are a great entrepreneurial tool because they provide a mobile solution for completing work on-the-go and staying connected with colleagues and clients. Unfortunately, business PCs are also a major point of vulnerability.
If you’ve ever lost a business laptop, there are probably many frightening scenarios running through your head. Sensitive client or company data from a stolen or lost laptop could easily get into the wrong hands and create an expensive mess for you and your IT team to clean up.
Although cloud security isn’t perfect, some cloud service vendors provide users with solutions to help combat cloud vulnerabilities. Security features might include virtual private cloud services as well as encryption and API keys to protect your company’s data and information, for example.
A major benefit of the cloud that comes in handy for security concerns is the ability to access important information almost anywhere. You can even wipe data remotely if a lost or stolen laptop has sensitive information you can’t risk getting out into the world.
In addition, users of cloud software can choose from among public, private, or hybrid storage options depending on company needs and other considerations.
If you’ve ever had to edit and comment on an article, PDF, or some other kind of file, you probably quickly realized just how frustrating it can be to send different versions of files back and forth over email. One user might save the document in an incompatible file format, another might edit on the wrong version of a file, and perhaps one unlucky fellow will accidentally delete the wrong draft. There are any number of other technological mishaps that are bound to happen when you mix long email threads and documents.
With cloud services, such as Google Drive, for example, you can work on “live” documents. These documents live in the cloud and allow multiple users to work on the same document simultaneously. This is a contrast to the frustrating turn-based system of collaborative editing and revisions that may result in serious inefficiencies that waste your time and money.
The centralized nature of cloud software makes it a great choice to use for businesses that regularly require input from clients, legal teams, and multiple colleagues. It’s a great way to keep everyone on the same page, literally.
5. Remote work opportunities
According to research, 73% of all work teams in the U.S. will have remote workers by 2028 . The number of work-from-home employees is increasing as workers demand a better work-life balance. But what’s a company focused on their bottom line going to do in the changing work landscape?
That’s where cloud computing comes in. With the cloud, all files are kept together so your employees can work wherever they happen to be – at home, in a hotel, or at the airport – even at the office.
6. Pay-as-you-go structure
Cloud computing can be used and paid for on a subscription basis. Many services run on a pay-as-you-go model. This is ideal for companies that have changing bandwidth needs and don’t want to be forced into buying IT hardware that has to be downsized later.
7. Automated updates
With the cloud, you never have to worry about making manual updates to your computing system. The cloud handles all updates on your behalf. Regular software and security updates are rolled out without lifting your finger.
8. Worst-case-scenario protection
Back-up and recovery solutions are necessary for companies to have and utilize when disaster occurs. Many cloud service providers offer backup protection as an included service or add-on.
Companies aren’t static entities. With a cloud-based service, you can take advantage of what IT experts call “operational agility.”
10. Staying current
If a company buys their own servers, they are also responsible for decommissioning and getting rid of hardware or software when it doesn’t work anymore. With cloud companies, you won’t be required to do that since that’s handled by the cloud service provider.
What are the drawbacks of cloud-based software?
While cloud software has distinct advantages, it’s important that you take the drawbacks into consideration when making the decision about whether cloud computing is for you and your company.
1. May not be cheaper
Similar to the way renting a home may not be cheaper in the long run than buying, renting space on the cloud isn’t always the best answer for your company either. You’ll need to weigh your options based on your company’s size, storage needs, and other facets of your business setup.
2. Competitor proximity
You may be reluctant to host sensitive data in a cloud services provider that is also used by your competitors. In the rare event a leak of data occurs, your data could end up in the hands of the competition.
One serious con of cloud computing is security concerns associated with them. Breaches with cloud systems are fairly rare, especially when you consider the security setup of in-house security versus a cloud security team, but we have all heard about hacks on various tech giants. Breaches do occur which could mean company data is at risk of getting into the wrong hands.
Systems monitored by a cloud provider have a dedicated workforce that continually works to secure the cloud infrastructure so in most cases, it won’t be an issue.
Instagram: a case study for cloud computing
If you don’t believe in cloud software’s potential, just take a look at what happened with Instagram. When Instagram was first developed and premiered in 2010, only one server powered the entire app. It turned to Amazon’s cloud services as engineers for Instagram quickly realized they couldn’t fire up servers fast enough to keep up with demand.
When Facebook bought the app in 2012, they slowly moved it to Facebook’s cloud service where staff now have access to data centers all over the world. Without these cloud services, Instagram might have been shuttered forever. Users may have given up on the app if it was too slow or didn’t work properly.