Many of us have seen it before – the latest fad in the IT world emerges, it goes through the Gartner ‘Hype cycle’, then the marketing guys pick-up on it and all of a sudden it’s the best thing since sliced bread (as my Dad used to say).
There’s no denying that Cloud Computing is the latest buzzword, but is it just another way of selling outsourced services?
Firstly, some definitions….
- Outsourcing – this is the contracting out of a business function, normally one previously performed inhouse, to an external provider.
- Cloud Computing service – for this article. I am not referring to a ‘Private cloud’ hosted in a firm’s building. I am referring to a Cloud type service that is hosted outside a firm’s premises – whether that be a Public Cloud or an externally hosted Private Cloud.
There’s no getting away from the fact that if you are using a service provided by a supplier, it is either an outsourced service or very close to being so. However, a Cloud service is so much more than that.
Why would you outsource?
Outsourcing occurs for a number of reasons, typically:
- Supplier can provide a better quality of service
- Supplier can provide service for lower cost.
- The function isn’t the outsourcing company’s core focus. I.e., don’t try and be the best at everything.
Why would you use a Cloud service?
Firstly, it depends on what type of Cloud service you use. Let’s look at two examples.
IaaS (Infrastructure-as-a-Service) services include Microsoft’s Azure platform. and Jersey Telecom’s OneSource. Typical benefits include:
- Avoid upfront investing capital into hardware and software.
- Avoid building Data Centre(s) in your firm’s premises.
- Access to computing resources when your need it – e.g., you may have very spikey/seasonal traffic, such as ticket sales.
- Ability to reduce total computing power, as the multi-tenanted servers will be better utilised than the traditional model of one server=one role.
AaaS (Application-as-a-Service) services include Google Docs, Gmail, Google Calendar, Xero Accounting, Microsoft’s Cloud-based Office365 and Dynamics CRM. Typical benefits include:
- Avoid an upfront investment of capital into hardware and application software.
- Avoid installing bespoke technology for just one system and avoid training technical staff.
- Geographic coverage due to the providers coverage.
You can see from just these two short examples that there are far more benefits to be had from Cloud computing services, than the traditional outsourcing of IT services.
So, getting back to the question….
…. is Cloud Computing just another selling opportunity dreamt-up by the marketing team in a bid to repackage and sell outsourcing services? The answer is ‘no’ – Cloud computing is far more than that.
There is no doubt that utilising Cloud services is a form of outsourcing, however Cloud computing is a paradigm shift from the traditional hosting model. Don’t dismiss Cloud computing as ‘the latest fad’ or just a ‘passing trend’. Whichever Cloud model is used, there can be many benefits derived when compared with the more traditional outsourcing of IT services.
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