Understanding How the Cloud Works: And why it’s the obvious choice for SMBs

It was not long ago when many people believed that cloud computing meant their data was actually being sent to the skies, and that stormy weather could interfere with their files, maybe even delete them. While (thankfully) we are past that stage of ignorance, cloud computing still manages to stump people, and for good reason too — the name, much like its MO is nebulous at best.

It is fair to say there is an entire school of thought dedicated to the definition of cloud. Yes, it's that big and yet people are still puzzled by its nomenclature. So, instead of peddling in jargon, let's examine how it came about and what happens when you upload data to a cloud.

So, What the *Bleep* is the Cloud?

At its simplest, the cloud is an outsourcing model where users access hardware or software located elsewhere. The concept dates back to the 1960s. The phrase originated from the cloud symbol in flowcharts and diagrams used to denote any shared or interconnected pool of data storage and computing resources.

Back then, mainframe computers were expensive and large. Most small companies were unable to afford computers and had to work via a timeshare model where they accessed computing resources from a dummy terminal. Around the 70s, service bureaus emerged renting computers to interested parties. All this was very similar to how the cloud looks today, except that it was very limited, pricey, and complicated.

The 1980s saw the advent of mini computers that were neither as expensive nor required a room full of hardware. Companies could finally install computers at their own premise, decentralizing computing and putting an end to the timeshare model, at least for the time being.

During the mid 2000s, as mobile devices and internet connectivity became more pervasive, the computing pendulum began to swing back to a more centralized setup. While mobile devices are powerful, they lack the storage capacity required to manage the incredible quantity of data being produced. Consequently, of-device storage became a priority and shared computing slowly became vogue once again.

As broadband internet has become more pervasive, consumers and companies alike can easily access more powerful computing resources remotely. Storage, application, and infrastructure are all available on demand anywhere in the world as long as the user has an internet connection. This way of working is collectively known as the cloud.

How the Cloud Works

Remember MS Word or Apple Pages? If so, then you would also remember purchasing and installing the software on your PC, saving files all the time and frequently updating the software. You could not access your files anywhere else and should the software go corrupt, you'd have to repeat the whole installation process.

Cloud based products like Google Docs on the other hand only require browser access. Your data is automatically saved in seconds. You needn't install any software, and the Google’s developers update the software without your knowledge. Your files are also accessible anywhere in the world as they are hosted online. This is just one example of how the cloud makes certain services more simple.

The cloud is essentially a collection of servers, either in a data warehouse or distributed around the world, shared among thousands of users. A company chooses what kind and how many servers it requires, and may scale its cloud storage up or down as needed. In turn, the company lowers operating costs because it is not responsible for the hardware necessary to store and process information. This flexibility and the low cost of access is why everyone loves the cloud.

Why the Cloud is the Obvious Choice for SMBs

The model is especially advantageous for SMBs as they may access powerful computing resources on demand at a fraction of the cost of onsite options. The cloud essentially gives the David of the corporate world a fighting chance to take on Goliath. Here are some advantages for SMBs using the cloud.

Increased flexibility: Businesses often have to deal with seasonal shifts in demand. Purchasing, installing, and maintaining hardware/software quickly becomes cost prohibitive. Cloud based services, on the other hand, are highly scalable. You can add or subtract resources as and when required.

No capital expenditure: The cloud can move your enterprise from a capital expense (CapEx) model to an operating expense (OpEx) one. As most cloud vendors offer a pay-as-you-go model, you only need to purchase features you need.

Economies of scale: Thousands to millions of users often share a single cloud, allowing its provider to spread the cost between them. A Microsoft survey found that 70% organizations reinvested savings from the cloud into bringing new talent and drive product innovation.

Built in disaster preparedness: Malware, theft, human errors and natural disasters are always knocking on a business's door. While traditional disaster recovery and planning can often invite expensive, if necessary costs, the cloud can provide a readymade safe haven as most vendors offer advanced built-in security and out-of-the-box backup measures. Since cloud vendors are managing data for thousands to millions of users, their disaster planning is usually far better than the plans most small businesses can install on their own.

Adopt modern work practices: The modern workforce is highly dynamic as trends like Bring Your Own Device (BYOD) and digital nomadism are on the rise. The cloud can facilitate such working methods by making applications and data available securely anywhere, anytime.

The cloud much like its namesake can take many shapes. Software as a Service, Infrastructure as a Service, Platform as a Service are all different ways in which we access resources that are much more powerful than our smartphones and PCs.

Indeed, cloud adoption has become a no-brainer for small and large enterprises alike. Around 83% of enterprise workload will be on the cloud by 2020. Companies that develop best practices around cloud infrastructure will leverage savings and drive faster development cycles, allowing them to take a quantum leap over their competitors.

This article only scratches the surface of the cloud’s capabilities. If you have any questions, feel free to reach out. Here at Bit by Bit, we have been helping enterprises develop tailor-made cloud based strategies for years and we will be glad to help you too. Contact us today and let's get the ball rolling!

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