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Cloud computing denotes the delivery of hosted services such as storage, data processing and management from a network of remotely hosted servers over the internet. The invention of cloud computing revolutionized various business operations. It offered firms lower operation costs, increased agility, lessened capital expenditure, lower start-up costs and better use of resources. Advocates assert that the deployment of cloud services allow enterprises to avoid up-front IT infrastructure costs. Proponents similarly claim that cloud services permit companies to access applications with less maintenance and improved manageability, which enable the IT department in any business to rapidly adjust resources and meet unpredictable and fluctuating needs. The use of cloud computing has allowed many firms to acquire a computing resource such as a virtual machine as a utility rather than having to construct and maintain in-house computing infrastructure. Many small companies are thus adapting this resource and enjoying the benefits that were once impossible to use.
Cloud computing refers to a collective pool of configurable computer resources and higher-level services, which can be swiftly provisioned with minimum supervision effort via the internet. Cloud infrastructure permits the delivery of hosted services via a network of remotely hosted servers over the internet. It creates an excellent way for small business owners to save time, money and hassle on a daily basis. The adoption of cloud computing has been made possible due to the availability of low-cost computers and storage devices, high capacity networks and the broad adoption of service-oriented architecture, hardware virtualization, and autonomic computing., cloud service also depends on resource sharing to attain economies of scale and coherence similarly as a public utility (Armbrust et al., 2010). Third-party cloud services have allowed many organizations to concentration on their prime businesses rather than expending the resource on computer infrastructure. This paper will, therefore, examine cloud computing and its impact on small businesses.
History of Cloud Computing
Cloud computing has advanced through a couple of phases, which include utility and grid computing, application service provision and SaaS (Software as a Service). The concept of cloud computing began in 1969 with ARPANET that was the predecessor of what is now the internet. It was initially meant to link computers over a great distance. However, the arrival of expanded web capability (Web 2.0) in 2003 saw the hosting and delivery of music, video, and other multimedia, which led to massive expansions of online horizons. Google CEO, Enrich Schmidt, brought the idea of cloud computing to public attention with regards to the name and all the possibilities and by 2006, people could openly talk about the cloud.
Google then continued to put cloud computing into more usage especially after it released Google Apps in 2009 although other companies such as Microsoft were not far behind. Within a short period, the internet arms race commenced, which fortunately has always functioned to push cloud technology forward. The end of 2009 witnessed the adoption of cloud computing in a particular niche (start-up and enterprise market), which swiftly was its advancement into the corporate market. For instance, cloud services made possible the meteoric rise of Amazon and others such as Netflix (Zhang, Cheng, & Boutaba, 2010). Currently, cloud computing has expanded to include SaaS, PaaS, and IaaS as well as cyber-security services. Cloud services such as Google and YouTube have had enormous influence on the social aspects of people’s daily lives. For instance, platforms such as Facebook and Twitter have altered everything from advertising to interacting.
Types of Cloud Computing
Infrastructure as a Service (IaaS)
IaaS offers cloud-based infrastructure as a wholly outsourced service. It is the lowermost level of cloud-based solution. A provider of this service offer configured and pre-installed software and hardware via a virtualized interface. An example of IaaS service includes web hosting. Google, Verizon, and IBM offer infrastructure as a Services solution.
Platform as a Service (PaaS)
This is a more advanced form of IaaS. Apart from offering infrastructure, the provider also provides a solution stack and computing platform as a service. The cloud infrastructure provided can also come with a run-time system library, an operating system, graphic user interface, and programming languages. Mostly, this kind of solution is employed in enterprises, which have to test, deploy, collaborate with and develop cloud solutions for a given application. Moreover, application hosting is done by the third party, which is the PaaS provider. Salesforce.com, Google App Engine, and Microsoft Azure are some examples of providers who offer PaaS solution.
Recovery as a Service (RaaS)
RaaS solution aid firms replace their backup and offer services such as disaster recovery, archiving and continuity solutions via a single and integrated platform. The providers of this service protect and help business recover data (database and files), data centers, and servers (applications configuration and OS). They also assist companies to reduce the impact of downtime during the phase of a disaster. Some of the companies that offer this service include nScaled, Geminare and Windstream Business.
Software as a Service (SaaS)
SaaS is the most commonly known by many people. SaaS offers full functional web-based programs as requested. These programs are mostly meant for business operator and may include email, project tracking, CRM, ERP and time management. Some examples of firms that offer SaaS solution include NetSuite and Citrix (Marston, Li, Bandyopadhyay, Zhang, & Ghalsasi, 2011). Some of the services provided by a SaaS include the elimination of infrastructure, rapid scalability and bundled support and maintenance among others.
Business can, therefore, tap to the benefits offered by these cloud services and improve efficiency as well as reduce costa among other benefits. An enterprise can adopt a cloud service depending on its area of expertise, business processes, and priorities. However, this calls for careful preparation and planning before switching to a cloud service.
This model is operated solely for a single business, whether managed by a third party or internally, and can be hosted externally or internally. With regards to cost efficiency, this model is less beneficial. They have a substantial physical footprint that requires allocation of hardware, space, and environmental control (Low, Chen, & Wu, 2011). It may also need to be refreshed periodically. However, most large companies choose it due to the security benefits provided. This deployment model has however attracted criticism since users still have to build and manage them and therefore accrue less hands-on management benefits.
The services offered by this model are rendered over a network that is usually open for use by the public. The infrastructure is hosted on the premise of the service provider who then offers the services to all its clients. Technically, there is little to no difference between private and public cloud architecture. The main difference arises from the security offered by both of these models. This form of deployment is mainly adopted by small to the mid-sized organization for some of their core and non-core operations. Some of the providers of this deployment model include Oracle, Google, and Microsoft.
This is a form of deployment model where the cloud infrastructure is shared by a group of firms of similar industries and backgrounds, and with a similar requirement such as compliance, IT policies, security and mission. This may be managed by a third-party or internally and hosted externally or internally. The advantage of this model comes regards cost whereby it is spread over a few users.
Hybrid deployment model combines two or more clouds mainly public, private and community clouds. However, all these models remain distinct entities but connected and thus offering the benefits of multiple deployment models. A hybrid cloud overcomes isolation and provider boundaries so that it cannot be put in any of these categories and permit the extension of either capabilities or capacity of the services offered by integrating, aggregating and customizing more than one type of cloud service.
Cloud Computing in Small Businesses
The adoption of cloud computing by small business has resulted in the evolution of how these enterprises operate. As noted, cloud computing offers business access to data and application from anywhere and at any time using via a network at an affordable rate. Cloud computing thus allows small businesses to tap into technologies that were previously out of their reach and permit them to compete among themselves as well as with other large corporates (Foster, Zhao, Raicu, & Lu, 2008). Currently, most of the traditional desktop apps are disappearing. For instance, most of the accounting software vendors are not offering desktop software but have shifted their products to the cloud and allow online subscription-based services, which are ideal for small business.
Benefits of Cloud Computing
Reduced Costs: Migrating to cloud services can help a small business reduce the cost of maintaining and managing its IT system and instead of purchasing expensive equipment, the owner can reduce the cost by using online resources offered by the cloud service providers (Gupta, Seetharaman, & Raj, 2013). Some of the areas that a small business can benefit include: reduced cost of upgrading, software, and hardware, decreased energy consumption cost, reduced delay time and the elimination of expert wages.
Flexibility: The cloud and the manner in which a business use it can influence its growth and change the way to progress over time. Moreover, by depending on an external organization to manage all the IT services and infrastructure, a business owner can focus more time on other aspects of the business that directly affect the bottom line (Truong, 2010). For instance, when one requires more bandwidth, the provider can meet the demand instantly instead of undertaking an involving and expensive route.
Mobility: Clouding computing enables a business owner to access data over a smartphone and other devices. It also allows flexibility among the employees in their work practice. For instance, staffs who travel, remote employees and freelance employee have convenient access to information and thus can have better work-life balance. Also, other employees can access data in the same way while at home, on holiday or when at work.
Enhanced Collaboration: A business that has more than one employee need to make teamwork a priority. Cloud computing increases this alliance by allowing virtual meeting and exchanging of information with the aid of shared storage. These capabilities enable the business to improve product development and customer service and similarly reduce the marketing time. Some cloud service provider even permits collaborative social space for connecting staffs.
Quality Control: In a cloud-based system, data is stored in a single place and a similar format. With all the workers accessing the same resources, the business owner can maintain consistency in data, have clear records for updates and revisions and mitigate human error.
Easily Manageable: Cloud computing offers enhanced and simplified IT management and maintenance capacity backed by central resource administration, managed infrastructure, and SLA. The employees get to access basic user interface with no installation requirements. Similarly, cloud computing assures timely management, delivery and maintenance of the infrastructure offered.
Loss prevention: investing on a cloud-based solution for storage and other services help business mitigate any incidence that may damage or result in data loss. Cloud computing allows all the data in a small business to reside in a single place rather than being inseparably tied to office computers (Khalid, 2010). Therefore, when computer malfunctions, get a viral infection or a simple user error, the business information is kept safe away from such risk since the data can be accessed from remote servers via an internet connection.
Competitive Edge: many large and small enterprises have adopted cloud computing. Therefore, when a business also integrates to this technology to its operations, it can compete with those who have benefited from cloud services. Also, when a small business implements a cloud-based solution before its competitors, such a business farther along the learning curve before the competitors achieve and catches up.
Sustainability: Real sustainability demands solutions, which addresses wastefulness at all levels of a business. Cloud hosting is more environmentally friendly and results in reduced carbon footprint. Cloud services support the powering of virtual services instead of physical hardware and products, which cut down paper waste and improve energy efficiency. Moreover, a business with cloud-based infrastructure only uses the resources needed and therefore can avoid any over-provisioning.
Negative Impacts of Cloud Computing
Dependency on Network Connectivity: For a business to reap the benefits of cloud services, it must always be connected to the internet. For instance, sending a file, using virtual machines require a connection to the provider’s servers. When there is an interruption in network connection, the business may experience downtime.
Limited Features: Not all cloud services are offered the same. For instance, when using the cloud for backup and storage, the business owner needs to work with a provider who can provide the service with unlimited bandwidth. One may also experience limited accessibility. However, this will depend on the package that once acquires.
Loss of Control: When using cloud-based services, one is allowing another organization to have access to data. Therefore, the business owner needs to get the services from a trustworthy provider that can keep the data safe and confident.
Security: Hacking cases have shown that not all cloud providers are secure. A business cannot afford to have its sensitive data about its operation or clients fall on the hands of hackers (Marston, Li, Bandyopadhyay, Zhang, & Ghalsasi, 2011). This is a crucial issue since it is hard to determine which provider is trustworthy.
Technical Issues: When a business experiences any technical issue, it has no choice but to call the cloud provider for help. Most of the cloud problems cannot be solved in-house, and some providers do not provide around the clock technical support.
Overall, clouding computing in small business offers many advantages than the identified demerits. Accessing technologies that were once only available to large companies by merely tapping into the cloud has allowed such business to rapidly grow and acquire a competitive advantage with both other small business and large companies as well. As have been discussed, the cloud offers a host of business purpose such as sharing and storing data and documents through file backup, collaboration and emailing. Moreover, it ensures substantial cost saving by combining the infrastructure, application development, support, and maintenance service. It also permits a business to only pay for the service used. Therefore, it is not just the computing power that makes cloud services attract to small business but also its ability to make a small business more agile in how it offers it services, creates products and respond to its customers as well as fending off threats.
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