Moving your Business to the Cloud

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Cloud computing, cost, advantages and disadvantagesUnder the cloud model, a third-party provider or vendor runs your data and software applications online, and users can access them via the internet. Simply put, instead of buying a server and the required software and licenses, you rent a service whilst the rest of the administration tasks such as maintaining, applying updates and keeping everything secure are taken care of by the cloud service provider.

Needless to say, Centrix agrees that cloud is a game-changer that empowers small businesses to thrive in new and evolving technologies for a fraction of the cost.

But just like any other investment, it’s best to consider both the advantages and disadvantages of cloud computing for your business before making that leap.

Advantages of cloud computing:

  1.  All types of businesses can benefit from it. It simplifies and reduces mundane IT tasks, so that you only have to focus on managing the business, not the IT infrastructure. Cloud computing providers will also maintain and monitor your server, including security updates and patches, and keep the latest versions of software up to date.
  2. No large capital expenditure. Start-ups can easily set up operations because there’s no need to purchase traditional IT equipment or wait for weeks or months to deploy services. Operating expenses are predictable – you’re only expected to pay a flat-rate monthly fee per user for the services that you use. Save your capital for other things such as product development and marketing which directly relate to business growth.
  3. It’s very scalable. You can easily add or remove users as required. Most cloud providers allow you to change your user numbers monthly, which means you are not paying for services which are not being used. 
  4. Helps increase IT agility. Cloud allows you to respond quickly and cost-efficiently to rapid changes in IT requirements. New applications can be provisioned and deployed in less time than what they normally require. It clearly becomes your competitive advantage to capture potential market opportunities.
  5. It increases productivity. Work is no longer limited to the four corners of the office. Users can access applications anytime, anywhere, and from any device. So even if they’re at home or at an airport lounge, with cloud they can always log in, and pick up where they left off.
  6. It increases employee satisfaction. Cloud provides freedom and autonomy for your staff to choose where and when they work. This flexibility positively affects employees’ work-life balance, which translates to increased happiness, and in the long run, a better business.
  7. Eliminates complex disaster recovery plans. When disaster does strike, your data is automatically backed up. If a fire were to burn down your office, your staff could continue to work from home uninterrupted. This would not be the case for an on premise network as you would need to first replace your infrastructure before being able to allow access to users, and this is also reliant on a suitable offsite backup that also has not been destroyed. 

Disadvantages of cloud computing:

  1. Increased bandwidth costs. If you are constantly downloading and uploading files to an offsite storage facility in the cloud, expect increases in telecommunications costs.
  2.  Control and customisation. Ultimately the provider owns and controls the cloud infrastructure which you are unable to access or customise to suit your particular requirements. Given the nature of cloud platforms, leaving and migrating your data can be a difficult and costly process.
  3. Possible downtime and other technical issues. All cloud service providers or vendors are prone to server outages and other technical issues. Even the best providers run into these kinds of problems.
  4. Security concerns. Really sensitive information may not be suitable to be hosted in the cloud. Understand that there’s no such thing as a hack-proof cloud provider
  5. Large companies might find it’s cost probative. Most efficiency and capital expenditure gains are from outsourcing to public cloud providers. Larger enterprises will often need to transition to a private cloud, which is less cost effective.
  6. Increased cost over time. There are varying types of cloud. Whilst some forms are clearly more economical, other cloud computing models may be less expensive in the short term but over time it may cost you more. See our comparison below.

Cloud vs onsite, which costs more over time?

Analysis of a 20-user company comparing On-Premise vs. Cloud (Desktop as a Service)

Item

On-Premise

Cloud

Up-Front Costs

 

 

Server Hardware

 $7,000

Included

Server Software (OS & CALs)

 $2,000

Included

Microsoft Office Software

 $5,000

Included

Backup Hardware & Software

 $2,000

Included

Anti-Virus & Anti-Spam

 $1,600

Included

Firewall & Router

 $1,400

Included

Other Server Equipment

 $1,000

Included

Comms Rack

 $1,200

Included

Installation/ Migration Costs

 $7,000

 $5,000

Total Up-Front Costs

 $28,200

 $5,000

Monthly Costs

 

 
Internet

 $100

 $300

Proactive Maintenance & Monitoring

 $2,000

 Included

Offsite/Online Backup Costs

 $200

 Included

Spam Filtering

 $80

 Included

Cloud Hosting Costs

 –

 $4,400

Total Monthly Costs

 $2,380

$4,700

One-Off/ Variable Costs

 

 
Unplanned Repair Costs

$3,672

Included

Total Costs

 

 

Total Cost Over 3 Years

$117,552

$174,200

 

Cloud computing can be a great opportunity to offload the hassle and costs of day-to-day IT management to solely focus on core business tasks. But then again, all businesses have different needs and comfort levels.

If you’re still uncertain how or if cloud can benefit your business, call us to discuss your options. Centrix specialises in IT managed services and IT outsourcing services Sydney-wide.