Cloud Computing Not Just Techie Pie in Sky (Commentary)

We’ve been invaded by technology. Communication and information flows abundantly through the maze of broadband connections around the world to smartphones, laptops and netbooks. Home, office or on vacation – it seems everyone is connected.

In 1990, Bill Gates made the prediction that one day, “technology would put the world’s information at your fingertips.” While I’m pretty certain Mr. Gates didn’t anticipate the device your fingertips would touch would be powered by Apple or Research In Motion, his prediction is proving to be right on point.

As a small- or medium-sized business leader you are probably less interested in the world’s information and more concerned about your business information; information that today is apt to be spread across your servers and desktop in the office, the laptop you carry, and the jump drive with those files you needed at the house that you are sure you left somewhere. Perhaps the information is in your e-mail at work, or in the e-mail you use on your phone, or the e-mail you use at the house.

Your business has a significant investment in servers, desktops, laptops and software. You probably have a smartphone with a data plan and a computer at home. Anyone with a smartphone and data plan can access the world’s information while headed back to the office trying to remember what’s where.

The difference lies in where software and information is stored. In your business, software and information is stored on various islands of capabilities, islands that you have paid dearly for. Your information can only be accessed if you are in the right place on a certain device.

The change that is taking place is called “cloud computing.” Rather than information being stranded on various individual devices, software and information is stored in the “cloud” and accessible from many types of devices wherever the Internet is available.

Small- and medium-sized businesses can benefit greatly from “cloud computing.” No longer is it necessary to make large up-front investments in server hardware, file storage, Web hosting hardware, Web applications, database storage, e-mail software, office software or business applications. All can either be rented by the month or, in some cases, used for free from the “cloud.”

Small- and medium-sized businesses that make use of the “cloud” improve their cash flow. Paying monthly for only what you need and use allows a business to avoid the up-front spending required to build technology infrastructure and the ongoing maintenance fees and labor cost to keep things running smoothly.

Business leaders are shocked when they discover this is possible. Understandably, IT people tend not to bring this up.

Small- and medium-sized businesses making use of the “cloud” are able to rent quality business applications that would not be affordable if they had to buy the software outright. Such applications are termed as, “Software as a Service,” or “SaaS.” More than 950 companies offer “SaaS” products today that cover the entire range of business applications and enabling technologies.

This is not simply a passing fad. The Gartner Group predicts the market for “cloud” products and services will grow from $46.4 billion in 2008 to more than $150 billion in 2013.

Hewlett-Packard and IBM are building “cloud” specific technologies targeted to “cloud” providers into their server computers. Intel and Qualcomm are creating chips that will continue to increase the power of smartphones and other small, hand-held devices. Nokia, Research In Motion (BlackBerry) and Apple (iPhone) devices are adding or enhancing the capability to front-end applications connected to the “cloud.”

Software makers are rapidly evolving their offerings to make better use of the “cloud” to deliver functionality and information capability directly to personal devices. Amazon, Rackspace, Google, Microsoft, Netsuite and SAP have made significant investment in “cloud” services.

Small- and medium-sized business should resist the urge to invest in additional hardware and software. The technology dollar will bring much more value if you rent rather than buy.

(Steve Hankins is CEO and co-founder of Accio.US of Springdale, a technology company providing advisory and management services for small- to medium-sized businesses. He may be reached at [email protected].)