When companies talk about “moving to the cloud” these days, they’re not referring to some sort of Jack and the Beanstalk type of fairy tale. In fact, you won’t even find “the cloud” in the sky. And companies aren’t really “moving” there at all.
So what are they talking about?
What Exactly is “the Cloud”?
First of all, the cloud is not a thing. It’s not a place, either. And that’s where the similarities between the wispy clouds in the sky and the clouds of the computing world seem to end.
The cloud is actually a network of servers (or multiple networks of servers, since there are many “clouds” within “the cloud”). So what’s the big deal? Many large companies operate networks of servers already. What makes this cloud idea so special?
The difference is that “the cloud” operates outside of those companies, rather than within them. It provides an Internet-hosted platform for many companies to take advantage of the same capacities and scales of the big boys.
In truth, the term “cloud” comes more from visual representations of old networking schematics than from any similarity to earthly clouds.
How Does the Cloud Work?
The cloud provides a network of servers. Each server (or set of servers) is responsible for a specific service. Some of the most common services provided include:
- Infrastructure as a Service (IaaS): enables cloud computing capacity to any company by providing technical “building blocks,” typically comprised of databases, web servers, file storage, e-mail services, and computing resources.
- Platform as a Service (PaaS): one level higher than IaaS, this variation offers a platform for companies to utilize virtual servers hosted in the cloud, and they can manage each of the building blocks themselves.
- Software as a Service (SaaS): software products deployed to the cloud and offered either on-demand or through a subscription.
- Backend as a Service (BaaS): connects web and mobile applications to cloud computing services through application programming interfaces (APIs) and custom software development kits (SDKs).
For a technical discussion of cloud computing architecture and how it all works, here’s a good look from the tech pages of HowStuffWorks.
Who Owns the Cloud?
A better question would be: Who owns the cloud servers?
Also: Who makes the most revenue from the cloud?
According to Datamation, the top two are Amazon Web Services (AWS) and the Microsoft Cloud, also known as “Microsoft Azure.” Combined, they claim over three million servers and over 41% market share of revenue.
Although AWS had a five year head-start and holds the “lead” in both measures right now, Microsoft Azure is rapidly catching up, with another year of 100% YoY growth in 2016 (compared to 53% YoY growth for AWS, according to Synergy Research Group).
What Can the Cloud Do For You?
The premise of the cloud is simple: with cloud services, you can go right to building the “stuff” you want to build…and skip figuring out and building and managing all the underlying software and infrastructure. This is especially valuable for smaller organizations that may not have the time, resources, or money to build all that from scratch.
As you can see, cloud services are a game-changer for many businesses. Here are a few more benefits to prove the potential value of the cloud:
- Eliminate on-premise installations. Have you ever had a software sale deferred or delayed while your customer tried to “figure out their server situation?” This frustrating – and fairly common – obstacle is removed when you deploy your software through the cloud. Also removed are many hours of tech support helping customers configure and prepare their hardware as a prerequisite of each sale.
- Dramatically reduce software operating costs. Not only are you leaving those on-premise installation headaches behind, but you can also leverage the cloud’s “multi-tenant” model to reduce costs. With many customers sharing a robust technical infrastructure (such as Microsoft Cloud services), you share the benefits gained from greater efficiencies and economies of scale. Keep in mind that this is sharing technology, not data – all data remains completely isolated (and, because of economies of scale, protected by security measures greater than most individual companies would employ).
- Increase flexibility and responsiveness to the market. As your product and customer base grows, a cloud infrastructure such as Microsoft Azure makes it very easy to scale up the capacity of your technology. You can effectively “swap out” your server hardware in as little as a minute or two, replacing it with higher capacity – or more capable – servers. In the physical world, swapping out all that hardware would take weeks and rack up an inordinate number of costs. With cloud services at your disposal, you can react to the market and upgrade your capacity without any manual labor (or the attached labor costs) at all.
Why Does the Cloud Matter?
As you can see, the cloud provides some very significant benefits for all different-sized companies. But what’s most important is that you can choose what specific services – and software – your company needs. And then pay for what you use.
The cloud is a great equalizer because it allows even the smallest companies to take advantage of synergies of scale. And you won’t have to sink vast sums of money into planning and building the architecture to make it work. Plus, when you need to change… you can, easily, and with minimal costs. Best of all, you can build your mission-critical software – for commercial sale or for internal use – and have it on the market in as little as four months. You don’t need to build all the infrastructure, services, and related software from scratch anymore. Just use the cloud.
