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Cloud computing is a concept that basically revolves around shared computer infrastructure owned by a third party and accessed over the Internet by paying customers. Because all the computer hardware and software, including the significant backend management processes involved, are outsourced there is no need for the business to invest large amounts in purchasing, owning, and upgrading own technology resources. With the shift to cloud computing, the business owner just needs to subscribe to a rental plan according to the requirements of the business, very much akin to getting utility services. The individual business now need not worry any more on keeping a vigil on the computer resources for efficient performance, security and redundancy. These aspects are all now taken care of by the cloud services provider. The savings due to this can be quite handsome and reflect immediately on the company’s balance sheet.
Cloud computing is a very good way of achieving optimal use of computing resources due to the inherent advantage of scalability. In the conventional computing scenario, the business has to make allowances to have adequate computing resources available to handle peak loads even though the resources could be idling or being used at a far lesser load the rest of the time. A cloud solutions & strategy can take care of making available extra computing power when required without having to pay for resources that are not needed at other times. A service provider is able to do this since a large number of businesses are sharing the resources and the data center loads can be optimized across different times. Essentially this translates to far more economical operation than with own resources.
As fallout of the economies of scale being enjoyed by each of the businesses enjoying shared resources on the cloud, the total expenses incurred by the cloud platform can be far less than the sum of the individual utility bills. Businesses operating their own data centers will invariably find that they are spending substantially more on power as the servers and other equipment have to be kept running irrespective of the quantum of load of the system.
One of the biggest cost heads of operating own computing centers is the cost of manpower. Often it can make up more than 50% of the total cost of the data center operation. Good people are also difficult to hire and retain and you have to provide for a number of employment costs besides the salaries. A cloud computing service provider is able to amortize its staffing costs over a number of customers so that on an individual basis the business has to shell out a lot less than if it were operating its own computer resources.
When businesses operate in a cloud computing environment they can do away with most of the capital expenditure incurred on the purchase of computers and other hardware or software. This means that the management does not have to worry about raising the necessary finance from banks or other lenders for the capital expenditure that carries a hefty rate of interest.
The shift to cloud computing enables businesses to harness the exact computing resources that are required and this can be scaled up or down as per the requirements of the business. This scalability translates to a lot of savings when compared to the conventional owned-computer resources. Depending upon the size of the business, the cost of building in the redundancy can be quite prohibitive and can be easily avoided with cloud resources.
Author bio : Jenny Richards works in a leading cloud computing service company mesusolutions. She helps her clients create a professional cloud solutions & strategy.
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