February 13, 2009, 12:45 AM —
In the marketing world, new phrases are constantly created to sell products and services. Sometimes, the word or phrases are clear and concise and other times, as is the case with cloud computing, the phrase may be concise, but it is far from clear. With cloud computing (and virtualization & Windows 7 & etc) all the rage these days, the concept is continuing to make its way into businesses everywhere. However, there are still organizations out there that do not know what cloud computing means to them which also means that they don’t know whether or not cloud computing could be good for the bottom line. In this post, I’ll explain the relatively non-technical basics behind the concept of cloud computing and explain why services “in the cloud” can result in a healthier bottom line for business.
Cloud computing: A definition
According to Wikipedia, cloud computing is “Internet based development and use of computer technology whereby dynamically scalable virtualized resources are provided as a service over the Internet.” In short, this definition of cloud computing basically indicates that the services residing in the cloud are based on scalable, on demand architectures that run in remote data centers with the service itself being delivered over an Internet connection. By this definition, pretty much any web site could be considered a cloud computing service. However, when it comes to actual cloud computing, more is implied; this can be best expressed by explaining another term often used in conjunction with cloud computing: Software as a Service (SaaS). SaaS is a class of software that is available on demand and, oftentimes, directly from an application service provider. One of the best known SaaS applications is Salesforce.com, a customer relationship management (CRM) application used by many businesses. Under Salesforce.com’s SaaS model, users connect to Saleforce.com’s web-based system and buy only enough licenses for their users. Licenses under their model aren’t "per computer" as is the case with a lot of other software.
In this case, it would be said that the Salesforce.com SaaS runs "in the cloud" meaning that it relies on the overall nebulous infrastructure that is called cloud computing.
Skype and BitTorrent are sometimes considered successful cloud computing architectures due to their peer-to-peer and scalable natures. These two services are inherently scalable based simply on the way that the services were created.
How does it work?
Armed with the understanding that the purpose of cloud computing is to deliver software and services to customers, how does it all work? What makes it possible for these services to be delivered to you?
There really is no single architecture that defines cloud computing. As I indicated before, Skype and BitTorrent are often considered cloud computing services; these services are completely decentralized. However, another service, such as Salesforce.com, relies on servers in data centers in order to operate. As more users are added to the service, the folks behind Salesforce.com add capacity to handle the increased load. A number of companies, including Amazon, Google and Microsoft have been and continue to build out massive data centers for the sole purpose of providing cloud computing services. So, even the SaaS provider itself doesn’t have to have a massive Internet-facing data center. They can simply rely on the services of one of these cloud computing infrastructure providers and focus on developing the best software possible for their customers.
You, as the customer, simply connect to whatever infrastructure is put into place or used by the SaaS vendor. The vendor may choose to build out their own infrastructure or may choose to partner with someone else. By sharing infrastructure among many customers rather than having each customer build their own infrastructure, cloud computing can keep overall hardware costs lower.
What is the benefit to you?
For the purpose of describing the benefit to businesses, we’ll look at the whole SaaS/cloud computing gamut. There are a number of benefits to be had when using cloud computing-based services over buying individual software packages and installing them on your individual computers. They include:
No need to hire IT staff to manage the services. If you’re relying on services being delivered to you over the Internet, there is no local application to worry about. Of course, there may come a point at which you may need a technical guru on your staff to help you with the harder stuff.
No major infrastructure build out. With cloud services, you usually need just a computer and an Internet connection. If the stuff you’re using sits in data centers on the Internet, there’s no need for you to have a bunch of servers locally. You basically pay for what you use.
Less expensive licensing. This is not always the case, but with cloud computing-based services, you can often save money on licensing.
There are, however, a couple of caveats:
Vendor reliance. What happens when you’ve based your entire business on SaaS and your primary application vendor goes out of business? If this were to happen under a traditional software model, you could continue to run the application while looking for a new vendor. Under cloud computing/SaaS, you’re completely dependent on someone else.
Data security. This point is somewhat related to your reliance on a vendor. Under a cloud computing/SaaS model, someone else houses all of your data, including sensitive customer information. Before you go down this road, be sure you understand exactly how your data can be accessed by your service provider and carefully review the company’s security practices and history.
For many organizations and particularly for those without IT staff, cloud computing and SaaS can be a boon. They allow you to focus on the business of your business without having to worry too much about complex infrastructure.