Blue skies ahead?

Cloud computing is one of the big IT questions for growing businesses. It offers them access to services which were formerly only availableto larger enterprises. So is it time to enter the cloud?

Cloud Computing

The cloud has become a fashionable IT buzzword and the general public is already used to accessing IT services from within it.

In fact, anyone who has a Gmail or Hotmail account, or uses services such as Dropbox, is a cloud user – not that they are aware of it. Using cloud simply means the programme you are running is not on your computer or network, but is held elsewhere.

Cloud computing is powered by large data storage centres with ultra-strong servers managed by IT companies. These ‘bunkers’ are often protected with military-grade encryption software and sit in fairly non-descript, quiet locations – for good reason, as they are now the bedrock of so much modern IT. It might seem a big risk for a business to hand over their files and data to a company without knowing much about them. The public might be prepared to place their personal files in the cloud, but are businesses wise to follow suit?


Virtually all IT services can be kept in the cloud and accessed via the internet. Previously, much of what is now in the cloud used to be kept on an individual’s PC or on a server. Thanks to cloud computing, businesses no longer have to keep server rooms, can scale up more easily and can buy the latest software upgrade as it comes online. These are attractive benefits for growing businesses.

Andrew Atalla, founder of digital marketing agency atom42, has all of his IT in the cloud and says it is both easier and cheaper to handle. “We moved to Google Apps for our email, for our files and a Gradwell solution for our VOIP phones,” Atalla says. “We also use GQueues for our task management and Evernote for note-taking. Together, these things allow us to work at 100 per cent capacity, even if we’re out of the office, which is fantastic.”


Using cloud computing can be a cheaper option for some businesses than keeping IT in-house. The reduced cost and easy access to high-quality services means that some in the industry are buoyant about its prospects. “There can be little doubt that the cloud is the future of computing,” argues Peter Groucutt, managing director of Databarracks, a company which provides data facilities for UK businesses. “The lack of capital expenditure needed for the cloud means solutions that were once only available to larger companies are now suitable for SMEs.”

Atalla agrees that, on the whole, the cloud is a lot cheaper than self-hosting, although competition has helped to reduce prices. “Costs vary. At the time, Google Apps was significantly cheaper than the Microsoft Exchange option we were on before. Although, with Office 365, I think that has now been addressed by Microsoft,” says Atalla. “ wasn’t cheap, but felt like good value for the functionality you got. Again, though, Microsoft has had a good stab at undercutting this with their new product.”


For many businesses, both large and small, IT has become a burden. Therefore a low-cost, hassle-free solution is what many have been looking for. Dave Green is the operations director at Walters Group, an electronics manufacturing business with a staff of 55. Green says his company was spending more and more time fixing its IT systems just to keep them running, but has now outsourced this to cloud-based provider Parachute IT. “The benefits of moving all this to the cloud have been massive for us,” Green says. “Walters Group has been able to free up nearly three days per week of our senior engineering manager’s time. Time which was previously spent propping up five servers with associated hardware and software licence upgrades and renewals is now channelled towards vital product development work.”



If you are going to move into the cloud you need to do the maths and make sure it will be more cost-effective for your business. If you have invested in infrastructure and have strong IT skills in-house, you may be in a good position already. Some firms which move into cloud computing choose to do it themselves, such as atom42. It depends on how prepared you feel at the outset and if you are interested in overseeing the transition. “I’m a bit of a geek at times, so I actually enjoyed the transition,” says Atalla. “However, if you’re a normal person, you might want to get someone in to help out with it all.” The Walters Group opted to bring in a third party, as it had broader requirements and a considerable legacy to maintain. “The whole process of migrating was managed very carefully by Parachute IT, who drew up a three-month project plan and specified our requirements very accurately. They worked closely with us to ensure all data and applications were migrated easily into the cloud.”

However, both firms needed stronger internet connections to handle all the additional data. “There is definitely a larger strain on our bandwidth, so I would only recommend making such a change if you have a strong internet connection,” says Atalla. “If you need a leased line put in to make this work, then you should really consider the increased cost of the line as part of the overall package – this can cost around £300 per month.”


The benefits of the cloud are obvious for many users. However, IT professionals are asking serious questions about the security and reliability of cloud technology. The main question is: “Who is responsible if something goes wrong, such as a hack attack or systems failure? Is it the business, the application provider or the cloud service company?”

“If I’m the IT Director of a small business and everything goes wrong, I can go back down through various levels of resilience to recovery,” says Roger Keenan, managing director of City Lifeline, a London-based data centre. “At the bottom level, if I have a disc with my data on it, I can take it away to a specialist agency and recover my data. But in the cloud, I have no disc and I am totally reliant on someone who I’ve never met correctly operating procedures I know nothing about and have never tested.” 


Free software generally doesn’t come with any guarantees or contingencies attached. However, business owners signing up to packages online are well advised to read the small print carefully before giving consent and are advised to get legal advice, if necessary. Even if you are happy with the terms and conditions, you can always take further precautions. “There is no one more evangelical about backup than someone who’s just lost a week’s work because they didn’t backup their PC or laptop. I’m sure we’ll see the same sort of thing in the cloud,” says Mac Scott, an IT consultant at Xantus. He says there is a danger that some business owners, used to using social networks, will assume cloud computing is more secure than it is.

“We are starting to see a generation of companies being set up by people familiar with social media and living and working in the cloud. One risk is their perception of the cloud, particularly regarding security and backup, is somewhat rose-tinted because it worked for them automatically on Twitter and Facebook – why shouldn’t it work for their company applications?”
Businesses are well advised to make contingency plans in the event of a systems failure, whether they are in the cloud or not. “I’m definitely aware of the security issues, but after careful consideration, I felt that working with a company that offered high levels of security, as do, we were well covered,” says Atalla. “After all, having your own files saved locally, in one place, has its own security risks.”


There are lots of great software deals out there for businesses and some will offer you new advantages which are worth considering. However, there is so much choice for businesses, it is worth considering all the options. Another question to ask yourself is: “How will all of these separate programmes work together?” Mac Scott says: “There is the challenge of integrating elements of your cloud IT and internal systems, with all the partners you need to wrap all that together. How many passwords and user logins do you have to remember as you jump from one application to another?”


Handing responsibility over to another firm, or even to a group of them, is a big move. Therefore it is really important to check the terms and conditions carefully before signing up. If you are going to take all your applications from one source, this is even more important. It is worth considering not just what your needs are today, but what they might be in the next few years. The idea with cloud computing is that it should be highly flexible – growing and developing with your company – so you need to be sure this is the case with your provider. Finally, it is always best practice to ensure you understand who is responsible for what.


The cloud offers some great opportunities for entrepreneurial businesses. The power to access the latest software and technology on a scale which suits you makes it a prospect worth considering. However, there are a number of points which entrepreneurs must consider before making the leap. Security, responsibility and portability of data are all big issues and need to be addressed. There are also practical issues, such as bandwidth, which are essential to invest in if you are to take full advantage of what is available. Entrepreneurs need to consider what their own requirements are and if their current system can be improved upon before moving into the cloud. Without that core knowledge, it is just fluffy thinking.