I thought that this week I would air my thoughts on the pro’s and cons of cloud computing against having the hardware and software located on-site on the local network. It would seem that cloud computing is the latest “big thing” and it may well take off in a large way over the next few years as people first prove and then trust the technology.
In effect cloud computing allows companies to buy in to services hosted in the “cloud” or “on t’internet” if you prefer. So rather than buying server hardware and all the associated software and licences that go with it such as Microsoft Exchange server and sharepoint it is possible to subscribe to a service and pay per seat per month, typically about £5 per user per month for Exchange and about £9 for Exchange and Sharepoint with some data storage etc.
The cloud computing concept is a good idea in theory, however it’s not quite as cut and dried as you might think, firstly you have to get over the idea that your data is not held in your offices, if you are a smaller firm of less than 250 staff then it wont even be on a dedicated server, rather you will have a slice of a shared server with your data ring fenced just for you. My problem with this is that once your data is up there in the cloud it is very difficult for you to be sure that no one else has access to it. We have all heard of several big names that have been compromised lately by cyber attacks and some could even be called cyber warfare, and one could imagine that an orchestrated attack against these resources would be attractive to those who are interested in this sort of thing and once they are in to the system presumably they would have access to hundreds or thousands of companies details/data or even just turn off the service to cause economic havoc. I know that you could be targeted directly if you had your own server in any case but it’s still worth bearing in mind.
My second issue is that once you host most of your data off site you become totally reliant on your communications lines, and if like most small businesses that’s a broadband line then the risk of it being off for a day or so once or twice a year are not that unlikely, and if you are unlucky enough to have had a problem then you will know that they often come in spurts so you may have a period of time where a line is unreliable. This would cause major business disruption if your data was in a data centre in London and you were sitting in your office in Wigan!
On the other hand if you are the type of company that has a lot or remote staff and not many internal people then it might make more sense to host this type of service in the cloud than at your office, you may not even have an office in which case it could help with collaboration on projects and smooth workflows. Another point to consider is that with the subscription based model you would get all the latest updates and upgrades applied automatically within the cost of the agreement so if that’s important then it could be good for you.
Talking about the costs, don’t think that the cloud based option is a money saver, it’s not meant to be, when you think that the average server is in use for 4 or 5 years for a small business and that you pay a one off fee for the perpetual licence for the software then its easy to run a comparison, lets look at a 10 user SBS Standard network running Exchange. A simple server (ML150 with 4 hard drives) might set you back about £1K and the server software another £750 plus installation & configuration (bear in mind that you still need someone to do the configuration on the cloud based system so not much saving there) then at the £9 per user per month it would equal the online option after about 20 months, meaning that you would have 2 years “free computing” and of course if you have your own box then you can run other software on there too such as your accounts package and other business software etc. The cost equasion seems to stay like this through the range of users ( 150 users = £16,200 / year) so cost is not the reason to go to the cloud in my view.
In conclusion, whilst I can see that it would be very useful for some small businesses to go to cloud computing it’s not for everyone, I think that the good old box in the rack or in the corner is here for a while yet, and for those who need the functionality that cloud based systems offering, there is the option to have a mix on both on premise and cloud based services, they will work together and will synchronise well.