Squeezing every drop from the Cloud

Entrepreneur Will Lovegrove takes a closer look at the revolutionary impact of Cloud computing for small businesses

10 years ago if you said ‘cloud’ to anyone they would associate that with the sky & rain. Today, cloud technology is as vital to new and small businesses as sunshine and water are to life. You think that is a dramatic exaggeration? Let me explain.

When we start a new business we typically have a very short supply of time, money and resources. Each of these three things is precious and needs to be spent on the core business activity. 99 times out of 100 the core business activity involves making a valuable product or service, finding a market for it, winning customers and generating revenue.

Cloud technology means you can bring all of your limited resources to bear on those core business activities and not waste them on secondary or tertiary activities such as communications, document management & storage.

That’s what makes cloud technology valuable. It makes your business highly efficient and streamlined when it’s at its most vulnerable. Today’s entrepreneurs build their businesses on cloud technology.

The origins of cloud technology and what it actually means

So what is cloud technology? Good question. In my 15 years experience of working with technology in small, medium and global companies the term ‘cloud’ has changed.

It started out as purely an infrastructure term, used to represent the removal of physical ‘data centers’ from IT architecture diagrams and replacing them with a “globally accessible, robust and resilient network of machines, storage and bandwidth”. That’s a bit wordy and difficult to draw so it became easier to call it ‘the cloud’ and draw a simple ‘cloud’ icon on a system diagram.

Then the definition of ‘cloud’ was expanded to include “utility computing business model”. I’d be surprised if you had heard that term before. But you may know it already as “pay for what you use”. In IT circles this was a massive evolutionary change that cannot be understated.

Gone were the old days (and headaches) of buying servers, renting co-location space in ISPs, hiring network and server configuration engineers to set-up your servers and keep them ticking over. Instead that was all replaced with virtual machines and a philosophy of “we’ll only charge you for what you use”.

Perhaps even more significant was the trickle down effect of this model on the business models of software vendors and their applications.

Software applications built on cloud technology were able to leverage the “pay for what you use” business model and pass that flexibility onto their customers. This created a new market for Enterprise level business applications hosted in the cloud, based on a Software-as-a-Service business model.

This article is part one of five. You can read part two – The Software-as-a-Service (SaaS) business model – by clicking the arrow links.

Will Lovegrove runs an award-winning mobile app software company called Release Mobile. He has just launched a new cloud-based data sharing platform, Datownia, aimed at helping small to medium-sized businesses connect their data to mobile apps and business systems.

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