Cloud Computing: Learning from the Startups

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While both large enterprises and smaller companies are considering cloud computing, the cloud is a more compelling proposition for SMBs. For one thing, SMBs generally have sunk less money into existing infrastructures and applications. Thus they don't need to do quite as much soul searching about replacing existing hardware or integrating or replacing existing software.


This is especially true for startups, which are presented as big users of infrastructure-as-a-service offerings like Amazon's Elastic Computing Cloud (EC2) in a recent CIO.com piece. The piece presents five lessons learned from several startups that employ the cloud to cut their capital investments and gain flexibility. The lessons make good reading for companies of any size that are considering making cloud investments. Though the companies in the article are using the cloud to deliver products and services, most of the lessons are also applicable for companies considering the cloud for more routine functions such as e-mail.


I especially like the first lesson, which is not to reduce staff numbers but instead to move resources from routine IT maintenance to more strategic tasks like software development. Arthur Wong, CEO of forecasting and analytics company Right90, tells CIO.com that after moving all of its servers except backups to Amazon's EC2, his IT operations staff is now devoting itself to more strategic duties. As I wrote in February, companies moving infrastructure and/or applications to the cloud will also need staff to take care of migration and management, to work with suppliers and to ease transition for users.


Despite all of the angst over outages and downtime due to the cloud, the second lesson is not to worry too much about downtime. Oliver Friedrichs, CEO of antivirus provider Immunet, says his company has experienced no downtime in its first eight months on Amazon's EC2. He also says the cloud gives his company added redundancy that wouldn't be possible with its own dedicated data center. That's one of the benefits tapped by IT Business Edge blogger Art Cole in a post on the benefits of internal clouds. Internal or external, Art points out clouds can help companies better manage their infrastructure performance.


IT Business Edge blogger Lora Bentley has been all over CIO.com's third lesson with several posts on the topic: Even after moving data to the cloud, you are ultimately responsible for security and compliance. In fact, Lora did a great slideshow with six tips for compliant cloud computing. Cloud providers like Amazon are not yet fully addressing data security concerns, says Ranjith Kumaran, founder and CTO of file-transfer service YouSendIt, in the CIO.com article. Friedrichs cautions companies not to stint on security resources after moving to the cloud. He says:

You do need security knowledge and security background, because you own these systems. There is no difference between securing these in Amazon's cloud and securing them in your own datacenter.

Lesson No. 4: Make sure you offer non-cloud options for customers not comfortable with the cloud.


And lesson No. 5 is to not take cost savings for granted. As several of the companies featured in the CIO.com article found out, you can hit a wall with cloud cost savings. One of them, link-sharing service ShareThis, found bandwidth needs were eating up some of its cloud savings, an issue it solved by using Akamai's Edge platform for the bandwidth-intensive portions of its service

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Add Comment      Leave a comment on this blog post
Apr 16, 2010 6:52 PM Bill Sorenson Bill Sorenson  says:

We've been providing hosted / cloud infrastructure to the SMB market for 9 years with hosted desktops and complete networks.  We run everyone's applications, provide 24 x 7 helpdesk, and move these companies to a pay for use model.  It's been dramatically successful and our clients continue to rave about the high availability, work from anywhere, and the cost structure.

We'll see this continue to grow and the support side for these SMB customers continue to be the key differentiator.  Not only to they get treated like large organizations with service on demand, but they also get the no capital leverage of a solution that grows with them.


Bill Sorenson




Apr 17, 2010 12:38 PM Nick Bartlett Nick Bartlett  says:

We have found that companies are sick of the increasing cost of local server based IT and are looking for more accessible and coat effective solutions. GeoOp (www.geoop.com) is one of those cost effective cloud solutions making it's mark in popularity and effectiveness for SMEs.

Apr 20, 2010 7:02 PM WMS WMS  says:

Lesson learned. Let me just say something about cloud computing. Cloud computing is great because it lets you access your documents and software applications from around the globe. To reiterate some benefits it can give: Low computer costs, less software costs, easy software updates, improved performance and data reliability, and of course worldwide document accessibility.  WMS


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