What is Cloud Computing and how can it help my business?

Cloud computing, iCloud, Cloud based websites – its all very fluffy isnt it? What does it actually mean, in laymans terms and is it of any value to running a business?


To answer the question of value to a business, it’s useful to understand first of all what a “Cloud” is.


So, what is a Cloud?

Strictly speaking the Cloud is the infrastructure or delivery mechanism by which to deliver a single instance of, or collection of Cloud based software services that are available and accessible via the Internet.  The Cloud infrastructure is designed that it can be scaled up or down easily depending upon the demand.

The Cloud infrastructure is built upon a highly resilient combination of computer hardware and specialised software that enables the  cloud based software services to be delivered to the consumer at near 100% availability. i.e. They are always available to be used, unlike a traditional sofware on a PC which can suffer hardware problems or software corruption and virus’.

The Cloud itself can be sold as a consumable service to host websites, data or other software services which in turn are sold on to end consumers or businesses.

A Cloud based software service could be anything from a credit card payment gateway such as Paypal or Google Checkout, post code lookup services,  document storage and backups, email or web based office software such as Google Docs; indeed anything that a person or other piece of software can use or consume that is accessible over the Internet and hosted on Cloud infrastructure.


Ok, I understand what a Cloud is now (kinda). What use is it to me?

Theoretically, the Cloud allows businesses or people to access and use the software service anywhere with an Internet connection and typically on a paid subscription basis rather than paying up front and purchasing the sofware or data that they wish to use.


Want an Example?

An excellent example is that of post-code data.  In the dim and not so distant past, companies had to buy (legitimate or otherwise) databases from suppliers of post-code data. These typically came in a file format on a CD that could be read by Microsoft Excel or similar and imported into business software.  This could mean an outlay of thousands of pounds which would severely dent the bank balance and cash flow of a business!

Now, with the advent of Cloud based software services, post code data can be accessed on a “per use” basis, which typically mean you only pay for each post code search you make! If you make 10 searches a day, you’ll get charged for 10 – if you make 10,000 you get charged for 10,000.

The Cloud infrastructure allows the company providing the post-code data to do so reliably, and on a cost effective basis for them. Cloud infrastructure can be “rented” from specialist providers using a simple pay as you use billing model. If the company begin supplying to more customers, they can buy more “cloud” to continue to deliver the post-code services reliably and quickly.

The Cloud makes it far more financially viable for smaller businesses to get access to data and Cloud hosted software services that would otherwise be beyond their means.

In this post, I suggested how you could run a business using just open source software.  In my next post, I’ll see what cloud based software is available for businesses to operate.




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