Cloud computing: What it means, why it’s important

When the going gets tough, the tough seek productivity gains through the adoption of new information technologies. Well, that might not be how the saying goes, but it is sound advice for the times.

Cloud computing is the latest buzzword in information technology. Its basic premise is to move where you store and process your information: from your in-house computer or servers, out to service providers' computers via the Internet.

From a user's point of view, you typically interact with the service using a web browser or VPN connection. The service provider's computer is where the real computational work is done and is where your data is stored and manipulated. If you have ever used Google Apps, Facebook, or Apple's MobileMe service, then you have entered the realm of cloud computing.

– Google Apps offers a web-based office suite, making it an alternative to Microsoft Office. The advantage is you no longer need to purchase and load software on you own computer but instead use your web browser to access software running on Google's servers to create, modify, and store your documents. Google Apps also allows easy document collaboration through a secure web link, so companies needing to share files no longer need to purchase and support a file-server system. Employees can access company files wherever they have Internet access on any device that contains a web browser, including smart phones.

– Apple's MobileMe service is another variation on the cloud computing experience. In addition to offering a variety of web-hosting services, MobileMe's central function is to provide for the synchronization of your contacts, calendar, bookmarks, email, and preferences across your laptop, desktop, and iPhone or iPod Touch. Once set up, you can enter information on any one device and have the other synchronized devices register the change within one minute or less. If you don't have one of your own computers handy, you can securely access your latest information from any computer using the Internet.


Cloud services can also benefit businesses by eliminating the large upfront capital expenditures for in-house IT infrastructure. Moving to cloud service providers also allows scalability; a business would purchase services as its needs fluctuate. This flexibility is particularly attractive in our current environment, as users could eliminate the cost of servicing idle computing infrastructure during scaled-back business operations.

Major cloud providers that cater to mid- to enterprise-level businesses include, which offers customer-relationship management products, and Amazon's EC2, AT&T's Synaptic Hosting Service, and VMware's vSphere products.

Differing from cloud services, which focus on a specific functionality, Amazon, AT&T and VMware offer fully custom cloud computing. How? It's called virtualization. Virtualization allows a single computer to run multiple operating systems, eliminating the need for more computers, and enabling a MAC user, for instance, to create a virtual PC environment on his or her computer that can run Microsoft Windows or Linux.

VMware and Parallels offer PC-based examples of virtual machine software at work. This virtualization is expanded to simulate large serving centers with services such as Amazon's EC2 and VMware's vSphere. With these products, not only can you simulate any configuration you may require but computing resources can be employed as needed since the "machine" is not dependent on any specific piece of hardware.

There's also a green bonus to virtualization: Tailoring your operating costs to varying levels of computing activity lowers energy consumption; it allows more efficient use of the computers in use as well as powering down components that are idle-an increasingly important factor as the energy consumption of computing centers grows.

With the perceived benefits of computing in the cloud, more firms are signing on. Gartner, an information technology market research firm, forecasts worldwide cloud services revenue to surpass $56.3 billion in 2009, a 21.3 percent increase from 2008.

Security snafus?

Since data is stored in the cloud and not on the user's system, data security is an important issue. "It is unsettling to folks to give control away," says Timothy Gillen, president of Terrapin Networks. The worry isn't baseless. What happens to your data when your cloud service provider ceases operations, for instance? (Large companies like AOL, HP and Sony have announced termination of some cloud services.) To guard against the loss of data, experts recommend making certain your service provider allows for the export of your data in a form that you can easily port to another system.

Ownership of your information is another security concern. A prime example is the recent flap over Facebook's terms of service changes, in which Facebook claimed rights to any uploaded content. Before adopting cloud services some industries will need to review legal requirements regarding the handling of their information. For instance, health care providers will need to insure that service agreements are HIPAA compliant before implementing any cloud computing services.

Services outages pose another problem for cloud computing. According to Gillen, has experienced at least three serious outages that have temporarily left clients without access to their CRM information.

Due to the potentially large market for cloud computing, the industry is highly motivated to address the security and access concerns that potential users will have. Many providers are starting to craft individualized service agreements that cater to the specific needs or their clients. With the maturation of the cloud computing industry, you may find the competitive advantages of adopting this technology increasingly fit the requirements of your business. BN