July 11, 2017

The “Cloud”: the wonderful, magical buzz-word that aims to solve all of IT’s cost issues and ease of access to business data. Depending on what side of the IT organization one falls The Cloud can either be a worthwhile way to save on IT expenditures and maintenance costs or yet another third-party service that requires management, recurring service charges, and worry about the security of the organization’s data.

A fundamental misunderstanding is that the Cloud (as a general concept) is somehow technologically different than technologies that organizations already utilize every day, whether it’s a web-based service (such as Salesforce.com) or an on-premise application hosted in an organization’s own data center/server closet. While cloud services leverage technologies that a lot of firms do not leverage in house (distributed computing, for example), the concept behind the Cloud is as old as the internet itself.

At its core, the Cloud is just someone else’s server. It is no different than the File Transfer Protocol (FTP) which has been around since 1971. File sharing services, such as Dropbox or OneDrive as an example, are fundamentally the same as an FTP server. What has changed, and what most Cloud services offer, is much improved tools and additional enhancements which make the service much easier to use. Instead of manually uploading files to an FTP server, Dropbox makes the upload and download process automated. They also add functionality such as versioning and ease of sharing which legacy FTP software does not support. The concept of Cloud storage is not new. Likewise, the concept of Distributed Computing is not new. Many Cloud providers, such as Amazon AWS, leverage large clusters of servers to provide on demand processing for those organizations who need to perform large calculations without the desire to invest in their own computing clusters. Like Cloud storage, this concept dates back the 1960’s and 1970’s.

If the Cloud is built on concepts that have been around since the advent of computing, why is it just now becoming a crucial component of an organization’s IT strategy? Marketing, primarily. It is important to understand the limitations of Cloud services and the implications of moving segments of an organization’s business to a Cloud service.


Cloud storage is usually the first area that organizations adopt as part of their larger IT strategy. Cloud storage does have advantages for several business functions:

  • Offsite backups of crucial business data
  • Archiving of business data/documents that need to be available for retention policies
  • Centralized repository for highly distributed teams that need on demand access to information (i.e. Dropbox Pro, OneDrive, SharePoint Online, etc.).

However, there are considerations that must be made when determining if Cloud storage is suitable for a particular business need, such as:

  • Speed of which restoring a backup from a Cloud backup service can be achieved. These tend to be slow, and sometimes require shipping physical hard drives
  • Service Level Agreements with the cloud provider. An outage at a Cloud provider is beyond an organization’s control
  • Costs of bandwidth to corporate offices and the user experience of office staff still having to traverse the internet to get at critical business data

Cloud Computing

Cloud computing refers to Cloud services that go beyond storage. This includes line of business apps (hosting the organization’s ERP or accounting system, for example) and web-based applications which live “online” only. Similar to using the Cloud for storage, there are several advantages that Cloud computing can offer:

  • On demand access to provision more processing power (CPU, Memory, etc.) as needed without investing in local hardware
  • Reduction of IT maintenance in house, as all regular maintenance from an infrastructure standpoint is handled by the third-party Cloud service provider
  • Disaster recovery; most Cloud providers have distributed resources around a large geographic area with multiple points of connection to the internet, reducing the risk of localized disasters or internet outages affecting availability

On the other hand, there are considerations which need to be factored into the decision to move to a Cloud computing provider which tend to get overlooked:

  • Security breaches at the provider can potentially impact many, many organizations
  • Long-term costs of Cloud-hosted solutions may be more expensive than the initial investment and ongoing licensing of on premise installations
  • Internal outages at the Cloud provider are still outside of the organization’s control, and while lessened by the distributed nature of most Cloud providers, can still affect accessibility and service levels
  • May require more maintenance and time commitment when interfacing those Cloud-based systems with other line of business apps/third parties not present in the same Cloud environment


The Cloud, just like any other technology or service on offer today, is merely a tool to be leveraged against certain use cases. It is not, as some tend to think, a magic bullet that will somehow solve an organization’s IT management and cost issues. In many cases, the Cloud can be more expensive than on premise solutions, yet the trade off in efficiencies and functionality may be worthwhile.

When determining if a Cloud service is right for the use case in question, a comprehensive review of all aspects of the service and how it fits into the organization’s larger IT strategy should be performed. Costs, especially the initial cost, should not be the driving factor. Security, accessibility, scalability, and ease of use are just as (if not more) important.