Cloud computing explained

Do you know what cloud computing is? The recent Optus Digital survey found over half of businesses owners didn’t. Which is a shame as most businesses are using cloud computing services without realising it.

Importantly for businesses, cloud computing offers cost effective ways to manage technology and grow while preserving capital and improving productivity. So what is cloud computing and how can we use it in our businesses?

What is cloud computing?

Just like millions of water drops combine together create a raincloud, cloud computing is a collection of low powered PCs assembled to create a super powerful computer system.

When you do a search on Google, the fast results are due to the hundreds of thousands of computers in their eight data centres around the world. Those computers working together have more power than the world’s bigger supercomputer at a fraction of the cost.

Because these “clouds” of computers make providing online services so cheap, it makes it easier for companies to offer software and data storage to customers at a low price over the Internet.

Cloud computing is driving almost every online service we’ve become used to in recent years from Google’s searches to Facebook’s status updates and Amazon’s online stores are run on the cloud.

How does the cloud help businesses?

The big advantage for business is cloud services do away with the need to spend money up front on computer software as most online providers charge by the month, which frees up capital.

Another advantage is there are usually no fixed costs, so you can add or reduce licenses as work ebbs and flows meaning there’s no reason to have spare computers or expensive unused software sitting around between projects.

Cloud computing also extends the life of IT systems as most online services only require a web browser to work rather than needing the latest fastest computers like most desktop software.

For staff, cloud services give the opportunity to work away from the office which improves productivity and makes a business more flexible.

What type of software can be run on the cloud?

Any software that runs on a computer can go onto the cloud. Business applications include office suites like Microsoft’s Office 365 and Google Apps, accounting services like Saasu and Xero and Customer Relationship Management tools like Salesforce and SugarCRM.

Many cloud applications are helping businesses do things they may not have had the time or resources to do before with services like Mailchimp and Campaign Monitor making newsletters easy or creating easy customer surveys with tools like Survey Monkey and Formstack.

The downsides of the cloud

Naturally there some downsides with cloud services, the obvious being that you need a reliable Internet connection to use them. If you’re going to be in planes or at remote locations, the cloud may not work for you.

You also have to trust the provider with your data and that they will allow you to download your own information and take it elsewhere. There’s also the risk that your account could be suspended if you breach their terms of service.

Overall though the cloud offers great opportunities for business owners, it’s worthwhile having a look at what services are available for your business and how they can save money while improving your office’s efficiency.

Netsmarts’ founder Paul Wallbank will be talking cloud on ABC Local Radio this weekend and on the Australian Business Women’s Network later this month. Our Digital Readiness survey helps your business get the most from cloud computing services. A more detailed explanation on cloud computing, the connected business, can be found on Paul’s site.