Cloud Computing’s Popularity with SMB’s

There is no simple answer as to whether or not 2010 was the year small business IT finally adopted cloud computing once and for all. On behalf of Microsoft, 7th Sense Research recently conducted a study on cloud computing in small business computing environments and found that 29% of SMBs view the cloud as an opportunity for small business IT to be more strategic. The study also found that 27% of SMBs have bought into cloud computing because it integrates with existing technology investments, while 12% of SMBs have used the cloud to start a new business.

Despite those figures, overall, small businesses are largely unfamiliar with cloud computing. Josh Waldo, director of SMB Marketing at Microsoft reveals, “Roughly 20 percent of SMBs claim to know what cloud technology is.”

The numbers just don’t match up, but Waldo points out that just because people may not identify with the term cloud computing doesn’t mean they aren’t using the technology. Take Gmail or Hotmail, for example: They are both prime examples of the Software-as-a-Service (SaaS) form of cloud computing and are extremely popular—without their many users even realizing they are using cloud technology when checking their inbox.

“People might not understand what cloud is. But they are using it. They’re using it in their private life. In some cases they’re using it in their work life. But they might not necessarily identify it with the term cloud,” says Waldo.

He believes that the lack of familiarity SMB’s have with cloud computing can be an opportunity for Microsoft, Zoho and other providers of small business technology. Says Waldo, “For Microsoft, what that means is that this gives us a big opportunity to really educate SMB’s about cloud technologies and how they can benefit their business. Our goal is really going to be to help SMB’s evolve how they think about technology.”

According to Waldo, the benefits for small businesses that embrace the cloud are potentially huge: “First, SMBs can get enterprise-class technology at a fraction of the price, where you’re not purchasing on-premises technology that’s going to cost you an enormous amount upfront. Second, it really allows companies, whether you’re a development shop and you’re building software, or you’re an end customer—like a financial or insurance firm—to focus on your business rather than your IT requirements.”

By outsourcing data-center needs, for example, small business IT can eliminate building out capacity to handle potential strikes in data or transaction processing, because they buy the processing power they need when they need it. This leads to another key benefit of cloud computing: elasticity and the expectation of mobility. Waldo defines elasticity as the capability to scale up or down rapidly, based on need. While that includes processing power, it also means being able to add new users from a seasonal workforce—without having to deal with per-seat licensing associated with traditional desktop software.

When it comes to the expectation of mobility, Waldo says that today’s notebook, smartphone and tablet-totting employees want to make their work more flexible by making it mobile. SMB’s can let employees access the information and applications they need while on the go by exposing core applications as SaaS via the cloud.

Embracing Cloud Computing
Waldo recommends that SMB’s that have decided to embrace the cloud by adding cloud computing to their small business technology portfolio seek expert advice. “We really think it’s important that SMB’s choose carefully. And if they’re uncertain, they should work with a third party or a consultant or a value added reseller or some type of agent who understands the various elements of cloud technology and [who] can advise clients,” he says.

According to Chad Collins, CEO of Nubifer.com, a provider of turn-key cloud automation solutions, the first thing a small business should consider is which problem it is trying to solve: “The most important thing is that the cloud really isn’t just about infrastructure. It’s about solving problems. It should be about scalability, elasticity and economies of scale.” Collins adds, “What our enterprise clients are asking for is the ability to create virtual environments, run applications without code changes or rewrites and, most importantly, to be able to collaborate and share using single sign-on interface.

Collins says that the person responsible for small business IT should ask a range of questions when considering a cloud services provider. Among the most important is: Does the cloud provider allow you to run existing applications without any code rewrites or changes to code? Microsoft’s research reveals that 27% of SMBs have already bought into cloud services because it integrates with existing technology, while another 36% would be encouraged to but into the cloud because of that fact. “Being able to migrate custom applications over to the cloud without rewrites is not only a huge cost saver but also a huge time saver for SMBs,” says Collins.

Another important question is whether the cloud provider offers granular user access and user-based permissions based on roles. Can you measure value on a per user basis? Can you auto-suspend resources by setting parameters on usage to avoid overuse of the cloud? The latter is important because although cloud services can result in immense cost savings, their pay-as-you-go nature can yield a large tab if used inefficiently.

Collins recommends paying special attention to the level of responsive support offered by a cloud provider. “I think for SMBs it’s really important. Having to log a Web form and then wait 24 to 48 hours for support can be really frustrating,” he says, adding that the provider should guarantee that a support team would respond in mere hours. Agreeing with Collins, Waldo points out that a service-level agreement with a high-availability and 24 hour support is key.

To discover how the power of cloud computing can benefit your SMB, please visit Nubifer.com.

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