The Cost of the Cloud

You have heard so much about “the cloud” and you probably don’t know exactly what that means but more importantly you have heard that it can save you time, which can equate to money, and money. Let me tell you what we see in the field.

As IT consultants to small & medium businesses we help them utilize what they have as well as discover what new technologies they can employ to save time and money. It is true that the cloud is an amazing thing. Here are some quick helpful facts:

  1. If you are thinking of starting a business you can get up and running much faster these days with a lot less capital expenditure. That is extremely helpful in this economy.
  2. The cloud can help you off load some very important services that your company must perform such as backups, email and, depending on what data you generate, database type services as well as financial.
  3. From a disaster recovery/business continuity perspective you can recover from a disaster and continue doing business quickly as your data is off site (like backups, email) and you can simply log in from a new location or system and get your data.

Now let’s talk about the cost. We have seen so many companies pull back out of the cloud mostly due to the cost. Many companies did the math up front and found that for their needs and based on what they had, the service they were looking to use in the cloud was too costly. Here is an example: a company of 10 people has 150 GBs of data that is critical (yes, there is a difference between important and critical data) and that data needs to have a SAS 70 Type II facility (for reasons that would take too long to explain in this article) – IF – they are to store off site. What’s more, they need snapshots of data at intervals of 6 months to be stored. Many cloud backup services don’t have SAS 70 Type II facilities nor do they do 6 month snapshots. They perform rolling 30 day backups meaning that on day 31 the data that was backed up over 30 days ago is gone or copied over. Just like many other companies in the U.S. right now, money is tight and watched like a hawk. Based on the above criteria the cost per GB averages a little over $3.00 so that means that the company would have to pay $450.00 per month for this cloud service. Many would just say, “no”.

Here is another downside. We have seen some small businesses completely outsource all of their software to the cloud (In this case the cloud is basically a company that has a datacenter who owns the software and lets the user “rent” the use of it). This means that the user owns nothing and has nothing on their server and personal systems. You may think it’s a great idea. You would until you encounter the time when you have to be or want to be productive and you have no internet connection. Remember, you need the connection to get to the server that has all of your software which is at the datacenter where all of your software is hosted – the cloud. To do this you have turn on your computer, log in, connect to the internet, log in to their server, open up the application and start working. (So much for quick productivity!) Since, in this instance, there is no internet connection AND since you have no applications on your personal system you cannot simply turn on your personal computer, log in, open the app and start typing.

What should you do? You want to take your time when making decisions about the cloud or any outsourced services. If you don’t have the time or the knowledge to research what you need find a consultant who can not only research the latest services out there but who also may be able to provide them to you. The reputable ones will research with you what you have, your needs, your budget and make the appropriate recommendations. For example, off site backups may be too expensive but hosted email – a perfect fit.

Hope this helps.

Robert Lane

President/Owner
ASE, Inc.
Getting you ready for tomorrow today
703-273-8388 ext 111

ASE, Inc. is an IT consulting, engineering, hosted and managed support services provider covering the Maryland, Virginia and Washington DC area.  Since 2000 ASE has focused on providing full outsourced IT department services to small and medium businesses as well as providing senior level expertise designing, installing and managing complex databases and network security consulting to very large entities in both commercial and federal markets.  Call ASE today – 703-273-8388.

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