Cloud Market a Small-Business Savior, but Not Out of the Woods Yet

By | May 18, 2012

The cloud is, supposedly, all things to all people. It's been around for years, says the hype--just look at things like Facebook or Hotmail. It'll change the way businesses conduct their business, the way IT interacts with the world; on and on it goes. But while small and midsize companies are now seeing real returns on cloud market investments (sometimes to the point of saving their business), there are still several potent pitfalls that may trip up cloud adoption.

Last Quarter, a Cloud Saved My Life

According to a recent Entrepreneur article, small and midsize businesses are starting to see direct benefits from cloud adoption. Take the example of Great Foods Group, which operates four Atlanta-area restaurants. Owner Patrick Albrecht had six years worth of documentation stuffed into every available space in his home and offices, but by moving to cloud-based system Evernote, he was able to put all of his documents in one place and easily view historical transactions to find the best vendor prices.

CDL Helpers in Winona, Minnesota, meanwhile, needed a way to keep its transport consulting business on track by keeping communication costs down. While a standard phone-and-switchboard system would have solved the problem, it would have come with a high up-front cost and approximately $500 charge per month. VoiP-based system RingCentral was able to provide the same level of service for $50 a month. Problem solved.

This is what CEOs of midsize businesses think about when they hear stories of the cloud--simple solutions that solve problems or pull companies out of the red. IT admins are often more pragmatic, but must be able to articulate their concerns to management or risk being railroaded into a cloud solution they don't want.

Risk Free?

Make no mistake, the cloud is coming. How quickly it arrives, however, will be determined by how well providers can deal with several emerging issues that concern business IT of all sizes. An article at Cloud Tweaks discusses five top threats to the cloud--possible problems that any IT pro needs to see coming.

First up is the highly fragmented nature of the cloud market. There is no monopoly in the cloud, no single dominant force like Microsoft in the desktop OS market. New providers come and go on a daily basis, making it difficult to know who offers the best deals and also slowing the adoption of market-wide standards. This lack of standards means a tendency for providers to be cagey about moving data once its been placed on their servers--without a demand from consumers, cross-platform integration isn't a top priority.

Of course, the two biggest threats when it comes to a company's data are vendor lock-in and security. Vendor contracts can be vague in both areas, and it's the job of midsize IT admins to champion the cause of their company. Data should never be owned by a provider and always accessible for movement if required--never accept assurances that aren't in black and white. In addition, it's important to consider the massive attack surface of the cloud and the perception many users have that cloud-stored data is inherently unsafe; to succeed, providers need to convince IT that they not only recognize these threats but prove they have a viable way to combat security shortfalls.

Last but not least are service outages; a locally managed server that goes down is a physical problem that can be addressed, but when data is stored half a state or half a world away, this same minor outage can be a serious issue. Just look at the downtimes of Microsoft's Azure, Amazon's AWS, or even Google in the last year.

Simply put, the cloud market is fighting itself--implemented properly, clouds offer significant, potentially savior-like benefits to a midsize company. But a lack of organization, standardization, and security often means such benefits are hit or miss. For midsize business IT admins, the goal is to become familiar enough with cloud technology that they can see through offers that look great but have no substance and can properly advise management when cloud hype becomes overwhelming.

This post was written as part of the IBM for Midsize Business program, which provides midsize businesses with the tools, expertise and solutions they need to become engines of a smarter planet. Like us on Facebook. Follow us on Twitter.

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