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Cloud computing: What it is and how your small business can benefit

July 8, 2010 - 6 Comments

Small businesses can reap many benefits from cloud computing

Does your company use Microsoft Exchange Online? Do you have a Google Mail account? Have you ever used WebEx to set up a conference call or an online meeting? If you answered “yes” to any of these questions, you’re using cloud computing.

So what exactly is cloud computing? Think of it as Internet-based computing. All software, information, and resources are located on a provider’s server that sits on a network far away. These services are provided to your computer, and other devices, on demand. Most cloud computing services are so quick and easy to use that you don’t even realize you”re accessing software that’s not located on your computer’s hard drive

You can get applications, called Software as a Service (SaaS) and hardware resources, called Infrastructure as a Service (IaaS), from the cloud. SaaS providers, which include such companies as Cisco, Google, Yahoo, Microsoft, NetSuite,, and others, install and maintain their software on their network of servers. Cloud applications are designed so that each customer has its own customized instance of that software; data and configuration details are kept separate from any other customers. Customers pay a monthly subscription fee for only the exact number of users who need the application. Of course, some personal cloud applications, like Google Mail, are free.

The Cloud

IaaS providers, including Amazon, Rackspace, and Terremark, deliver storage capacity and computing resources. These providers charge customers for the resources they consume on an on-demand basis, or they charge a subscription fee for reserved resources. With either option, you”re not paying for an expensive server set up to handle spikes in your website”s traffic that only occur during certain times of the year.

Small businesses can get a lot of bang for the buck with both types of cloud computing– and many already are. Cisco surveyed more than 500 small and medium-size businesses to find out how they’re using cloud computing. At least 75 percent of them are using cloud computing for a variety of applications, especially security, storage, and desktop productivity applications.

But what can cloud computing do for your company? Check out these five reasons to give it a chance:

1. Pay only for what you need. You pay for the IT resources you actually use in the cloud, so your company no longer risks over-investing in hardware that is underutilized, or under-investing in software that soon needs additional licenses.

2. Eliminate complex software installations. Your PCs already have Web browsers installed, and that’s all you need to access tools in the cloud. In general, the providers handle the complex configurations and updates.

3. Access to enterprise-grade applications. Small business software is usually less robust than its enterprise counterparts, but cloud-based applications give you access to advanced, big business features. By securely sharing an application with others, you are able to utilize these advanced features at an affordable price while also maintaining protection for your company’s confidential information. In addition, providers upgrade their applications more frequently than most small companies can afford to.

4. Respond to business changes quickly. Adding seats or increasing server capacity in the cloud is as simple as logging on to your cloud service. You can scale up or down as your business requires, and you can do it in a matter of minutes.

5. Try before you buy. Many business applications, such as CRM (customer relationship management), are available in the cloud, and providers frequently offer free trials and extensive demos so you can see if the application is right for your company. Even monthly subscriptions make it easyand affordableto check out new software.

Are you already using cloud computing? If so, for what applications or services? Tell us what’s working–and what’s not working–with cloud and your company.

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  1. Patrick- you are right on with regard to the risks of cloud computing.   The level of risk truly varies with each cloud service, so it is  important to ask the right questions before selecting a cloud service provider.  Here is an article on investigating the security and reliability of a cloud service.


    On top of that, I encourage you to check out for  a wide variety of resources.  In the upper right corner is a brand new Cloud White Paper.  Although not specifically targeted at  small businesses, it has some valuable insight on benefits and risks  related to cloud computing.  Hope this helps.

  2. Jeff,

    what are the point of failure risks associated with moving to a cloud environment. i think we would have the obvious types of risk are bandwidth constraints, security, single points of failure, and upgrade procedure being done by one entity effecting a whole business community. how is this going to be mitigated for small business, the simple loss of email creates havoc within small business communities, this seems to add another level of risk. is there a white paper or a document available outlining the the risks?

  3. Hi Robert, thanks for your question.  Cloud computing is more of a  concept than a specific solution.  But in terms of the cloud-based  services that Cisco offers small businesses, I encourage you to check  out our our page on Hosted  IP Telephony on Partner Central.  Often times the term “hosted” is  synonymous with “cloud” because it means that some aspect of the  solution is hosted in the cloud, and delivered from the cloud to the  customer. Hope this helps.

  4. Can a demo be possible to show the full or partial working of the cloud computing. I want something to demostrate to my customers who are intersted.

  5. Cisco Just published a White Paper “Cloud Powered by the Network: What Every Business Leader Must Know” 


    Cisco CTO Padmasree Warrior writes in the forward:

    “We address this paper to business leaders with an understanding that many of you have already been exposed to a deluge of technical treatises and marketing messages on Cloud. In this paper, we offer our thoughts on where we believe Cloud is going from a business perspective and why it’s relevant for your organization.”


    You can follow her on Twitter @Padmasree

  6. Thanks for contributing Jeff — Can’t wait to read more about the cloud!