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WHAT IS CLOUD COMPUTING, AND WHY SHOULD I CARE?

By Tony Hodgson, Director, Sales & Marketing

As a business owner and manager, are you wondering what all the latest buzz is about Cloud
Computing? Why is the press bombarding us with this term and what does it mean? Should
we even care?

If I.T. industry is telling us theyre moving in this direction, perhaps we should understand the
evolution, why it is happening, and what it practically means for our businesses.

History of the Term Cloud Computing

The term Cloud comes from pre-1990 telephony roots, when data circuits were commonly
hard-wired between destinations. Telcos soon found they could improve the reliability of
communications between two endpoints by dynamically routing data through their full maze
of network switches, instead of following a dedicated path. If one network device blitzed
out, the data were automatically re-routed to get to the destination which is much more
efficient and reliable. Rather than depicting the complexity of network devices between two
end points and the unknowable path data traversed between them - network diagrams
commonly included an amoeba-like cloud outline representing the network. All that really
mattered to the end-user was that data went in one end and reliably popped out the other.

The modern usage of the term "cloud" is conceptually similar. In the late 1990s, companies
like Salesforce.com began providing software as a service using applications hosted on their
computer servers located across the globe, and accessible on demand by the customer though
Internet connections and inexpensive monthly subscriptions. These applications are typically
customizable by the user and require limited technical support. Rather than being concerned
about technically how the applications are able to run on our desktops, we really only care
about their availability, flexibility and speed they offer. Thus, the cloud moniker for this
distributed technology solution.

The term Cloud Computing also now refers to technology used to virtualize corporate
networks. Rather than being dependant upon a single network device (like a critical database
server) to be operational 100% of the time, several computers can be interlinked, and the data
and applications shared between them. If one machine goes out, the applications intelligently
continue using the others. Even individual hard drives in machines can be interlinked so if one
fails, the others continue providing service as if nothing happened. The cloud provides the
service that an individual machine or network cannot.

More than referring to some new gizmo invention, Cloud Computing is a term describing the
family of general virtualized solutions from redundant devices in the computer, to
interlinked computers in a data center, to geographically-dispersed networked locations, to
applications hosted and provided by companies youve probably never talked to running on
servers Heaven-knows-where now available to provide you with unprecedented business
benefits.

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Cloud Computing Solutions

Cloud Computing has gained popularity in the mainstream press and come to refer to the
general shift of organizations switching from company-owned hardware and software to per-
use or subscription service-based models. Providers such as Google, Amazon, Microsoft, IBM
and many others offer solutions. In fact, if you have an AOL, Yahoo or Gmail email account,
youre already using cloud solutions. Facebook, LinkedIn and the other social networks are
other examples.

With credit to Wikipedia, I submit that,

Cloud computing is a style of computing in which dynamically scalable and often virtualized
resources are provided as a service over the Internet.[1][2] Users need not have knowledge of,
expertise in, or control over the technology infrastructure in the "cloud" that supports them.[3]

Gartner defines five attributes to Cloud Computing:

It is service-based.
It is scalable and elastic. I.e., it is able to add and remove infrastructure as needed.
It uses shared infrastructure to build economies of scale.
It is metered and users pay according to usage.
Most importantly, of course, it uses Internet technologies.

Top Ten Benefits of Cloud Computing

Thats all mildly interesting, but what does it mean for our businesses?

1. Improves Cash Flow - Cloud computing customers are generally able to avoid capital
expenditures by renting usage on equipment from a third-party provider. They
consume resources as a service and only pay for resources per-use or on a subscription
basis.
2. Decreases Utilization Costs & Improves Productivity - Sharing computing power
between multiple internal and external customers can improve utilization rates,
because servers are not left idle, thereby also reducing costs significantly and
increasing the speed and availability of applications. Utilization and efficiency
improvements are realized for systems that may otherwise be barely used.
3. Provides Global and Diverse Accessibility - The rapid increase in the availability of
high-speed bandwidth also makes it possible for users to receive practically the same
application response times, regardless of where they are geographically located around
the globe. Companies are afforded much greater freedom to locate their workforce in a
distributed fashion. Remote employees and home-based staff can access systems using
the full array of modern network communication devices (PCs, Macs, Blackberry and
PDA devices, etc).

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4. Provides Flexibility for Growth - Businesses become much more agile because they
can rapidly and inexpensively re-provision their technological infrastructure.
Resources are available on-demand, and therefore, scalable in near-real-time to
accommodate dynamic needs of the business.
5. More Inexpensive to Gain Technical Advantage - Up-front costs are absorbed by
the provider and spread costs over longer periods of time, improving cash flow for
small and growing businesses. Capital expenditure is converted to operational
expenditure, where infrastructure does not need to be purchased for one-time or
infrequent intensive computing tasks. New avenues for structuring tax payments
become available.
6. Decreases In-House I.T. Expenditures - Fewer IT skills are required in-house for
implementation. Companies can also share resources and expenses, such as
centralizing infrastructure in locations with lower costs (such as server room real
estate, electricity, etc.)
7. Increases Business Continuity and Disaster Recovery (BC/DR) Options New
business assurance levels become immediately available because of the improved
reliability of using redundant sites and equipment. The impact of natural and man-
made disasters is reduced when commerce can continue regardless of the location of
key personnel.
8. Affords New, Innovative Business Alliances - Loosely-linked network architectures
can be built using web-services, providing highly dynamic and monitored software
solutions joining companies with their vendors and clients in innovative ways.
9. Higher Levels of Security - The centralization of data and utilization of shared,
expensive security solutions can improve data protection and auditability.
10. Improves Enterprise Reporting - Extensive reporting on network usage and user
activities can be provided to company administrators, often from any web browser.
Detailed

Considerations

Its not all wine and roses, of course, because users must also understand the limitations of
cloud computing. Scariest among them is that you wont necessarily physically possess your
stored data. Once a user uploads their data to cloud computing service provider, even though
most security issues have been adequately addressed, you can lose control if the service
provider experiences problems. Proper backup solutions can be put in place to mitigate this
risk.

Another concern is that users may be limited in the applications or services theyre able to
use. You get what service providers give you, and the ability to customize or load
complimentary applications may be limited, inhibiting both freedom and creativity. Here is
where a provider of comprehensive hardware, software and data center services can be
invaluable. A cloud solution vendor that understands your business, specifically, will be a
valuable asset in employing the correct suite of tools for your business.

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Assistance for problems can be delayed, or in some cases, unavailable. Often, providers
minimally staff their offices, so timely assistance from a live person may not be an option.
Partnering with a reputable company providing a professional help desk can get you the help
you need quickly. A company that provides both remote and on-site support is even more
valuable.

Too, as with your monthly electric bill, once you start using these services, if you dont pay,
your service can be shut down and you can end up off the grid. Rates are also subject to
change, so what costs you a buck today may be three bucks tomorrow. Read your contracts
carefully and understand your commitment. Being a good partner with your provider and pay
in a timely fashion. Cloud solutions often require considerable investment on the part of the
vendor. You helping to provide financial stability will improve the availability and quality of
the service you receive.

Finally, if you lose Internet connectivity, youre often hosed. Thinking ahead about reliable
back-up access to the network can make all the difference in these situations. For example, a
back-up 3G wireless connection can provide you with usable albeit slower connectivity if
you experience an outage of your primary internet connection. A quality vendor will provide
several options for securely connecting to your network solutions.

Conclusion

It seems Cloud Computing is an industry movement here to stay and not simply a buzz-word
that will soon fade away. Cloud solutions are already providing real benefits to organizations
and can dramatically affect the evolution of your business. It is valuable for company
executives and managers to understand the philosophy driving the movement, and the benefits
& drawbacks of various solutions. Ultimately, choosing a proven, reliable provider will help
ensure your business continuity and security, fueling a larger bottom-line.

Tony Hodgson is a I.T. veteran with over 21 years helping organizations enjoy the business
and engineering advantages of computer technology. He is currently President of CAP5
Technology Solutions, a computer networking and web applications firm in Houston, and on
the Executive Board of the Houston Emerging Technology Council. He is a frequent public
speaker, passionate about how applying I.T. solutions can improve organizational
effectiveness and revenue generation.

CAP5 is the premier provider of OneCloud solutions in Houston, TX, and beyond:
infrastructure, software development and data center services.

For more information on OneCloud Computing and I.T. solutions that strengthen
business, visit www.capfive.com or contact CAP5 Technology Solutions at 713.979.5280

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