The Rising Cost of Cloud Computing

Whether you hire the granddaddy of cloud computing, Amazon or some other cloud computing service, it is without a doubt that startups practically build up their businesses with the help of cloud computing services which provides them with instant access to cloud services via the internet.

What is the Cloud?

So, here's some technical news for you. The Cloud is basically a metaphor for a collection of computing resources, such as, virtual servers, storage, and network equipment, CPUs and RAMs which is used by users via the internet. The term cloud computing mainly refers to the practice of using those resources collectively to achieve an organization's storage goals instead of using its on-site equivalent.

Cloud computing services offer organizations with the option of buying IT as a service rather than having to create an entire section for housing a range of hardware equipment. This is the main reason why cloud computing services is more often than not compared to an electrical grid station. Because the users do not need to understand the infrastructure or the devices which have been used, all they have to do is use the cloud computing service and make monthly payments of the services which they are using in their business.

It is a well-known fact that users who visit e-commerce websites don't stick around too long if the website stalls. So, as businesses move to the cloud with the sole purpose of improving their services, the situation regarding the costs becomes even more complicated. From a management's point of view, the following are some of the major areas of concern in using cloud computing.

Poor user experience because of performance bottlenecks. Since e-commerce is the only leading cloud application area according to the latest technical news, a recent survey showed that nearly 70 percent of respondents are already using cloud resources to support their e-commerce websites.
The loss of revenue which is due to poor performance, or troubleshooting issues regarding the newly implemented cloud services.
The increase in costs of hidden charges which may pop up later on when a business has entered a complex environment.
The effort is required to manage service level agreements and vendors.
The impact of poor performance on the consumer's perception of your brand, product or service. This is one of those areas which will most definitely affect brand loyalty.

The following are some of the questions that businesses need to ask themselves when making the transition to the cloud.

Problems relating to service availability?

What happens when transactions back up because of slow service?

How much does it cost you to sit and wait while you get on the phone with the providers' technicians to sort through an issue?

Bottom Line

The fact of the matter is whether cloud computing works for your business model or doesn't, eventually, every business needs to scale in a way that is not possible while using physical servers. Even though there are those companies who have seemed to have soured on the cloud, the truth remains that even the best in-house hardware cannot compare to the cloud which is the reason why businesses should design a plan before making the switch.

Source: HOB

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