“The economics of cloud computing are driving down the cost structure of business so far and so fast that it’s scary,” said Google CIO Ben Fried when addressing the cloud boom at the Bloomberg Link Enterprise Technology Summit in New York in May 2012. He believes the macroeconomics of the cloud will force companies to adapt their systems to the cloud.
“Cloud-based computing is fast approaching the tipping point that will make it the standard for IT,” Fried said.
The economics of the cloud are about more than lowering costs. “Its changing the structure of businesses and markets,” says Fried who calls the cloud a “vertical integrator.”
Cloud applications, such as cloud email, productivity and collaboration apps, have been a key factor in the growth of the cloud as business have been rapidly adopting cloud applications to enhance mobility and productivity for employees. Fried predicts the next wave of cloud computing to enable the sharing of IT environments to run those applications in the form of private clouds, hybrid clouds and public clouds.
Enterprises are already looking to private and hybrid cloud infrastructures to provide cost savings and enhance scalability and productivity. Small and mid-size businesses are expected to follow suit as they start to replace aging infrastructures.
The prospect of transferring upfront, capital expenditures to longer term, recurring operational expenditures gives cloud users a financial advantage. They money saved using the cloud can be used instead for research and development or advertising, for example.
Using the cloud for reducing IT infrastructure investments is expected to push cloud computing past the tipping point to where businesses that have adopted a cloud infrastructure will have a distinct advantage over competitors. In fact, the financial services industry is already using technology as a differentiator.
Numerous studies have shown that cloud computing is not just a passing trend, it is the future of IT. If Fried is correct, businesses will need to evolve with the cloud or get left behind.
Contact ACE IT Solutions to find out how your business can benefit from the cloud. ACE IT Solutions offers a variety of cloud computing services to meet your business’ needs and budget.