Cloud computing - server room

What is cloud computing?


Explore cloud computing: the types of clouds, benefits, and how to choose a provider.

Time: 6 minute read

Cloud computing isn’t new, but for businesses this tech has become essential. Today, organizations of every size and type can benefit from the cloud. In this article, we answer the question, “What is cloud computing?” and – 

  • Discuss the benefits

  • Describe the different types of cloud implementations 

  • Options for businesses

  • What to look for in a cloud partner

What is cloud computing?

Cloud computing has changed the way businesses manage and store data by accessing computing services over the Internet. Rather than purchase and maintain onsite data centers and servers, businesses lease technology services such as applications, computing power, storage, databases, and business intelligence on an as-needed basis from a cloud services provider (CSP).

Cloud computing allows for cost savings. Customers pay only for the services they use, and the fixed costs (hardware, utilities, and other location-based costs) of a CSP are spread over multiple customers. Cloud services are usually offered on a monthly subscription basis.

Further, businesses can account for cloud services as an operating expense (OPEX) instead of the capital expenses (CAPEX) that come with maintaining on-premises equipment and data storage, maximizing tax advantages.“

The cloud” is not a singular entity. Rather, it is a collection of multiple servers strategically placed around the globe (often in data centers). They are linked together and located close to user populations. This allows them to intelligently balance workloads, route data, and deliver services to end-users with as little latency (that dreaded lag between click and page load) as possible.

There are thousands of clouds.

Different clouds do different things. Various CSPs specialize in providing different types of services such as data backup, disaster recovery, email, virtual desktops, software development and testing, big data analytics, and customer-facing web applications to name just a few. Amazon Web Services (AWS) would be one example.

The benefits of cloud computing

The primary benefit to businesses, especially SMBs, is affordable access to computing resources that would be well beyond reach of what the company could afford to deploy, staff, and manage on its own.

Cloud services are instantly and infinitely scalable to meet changing demands, and the onus is on the CSP to ensure the network meets performance and security standards, allowing businesses to focus on their core competencies rather than maintaining data networks.

Migrating IT operations to the cloud can speed digital transformation by delivering:

  • Enhanced agility. Add services and deploy new technologies in a matter of minutes to meet changing market requirements.

  • Improved scalability. Increase or decrease bandwidth as business needs change; never pay for more capacity than is consumed.

  • Simplified infrastructure. Utilize existing CSP network assets rather than build out and maintain internal resources.

  • Enabling remote workforces. Attract and retain the best talent by allowing remote employees to work and collaborate from anywhere.

  • Reduced latency. Place data and applications closer to end users for a better experience.

  • Cost savings. Minimize capital IT spending, data center footprint, software licensing, and staffing expenses.

  • Improved data security. CSPs are responsible for maintaining SLAs for privacy, regulatory compliance, and overall cyberthreat detection.

  • Integrated disaster recovery. Offsite CSPs provide business continuity and redundancy to guard against data loss in the event of a disaster on-premises.

Engaging a CSP, however, doesn’t mean that you don’t need internal technical expertise. But businesses that are not in the business of data management can benefit from partners who are experts in IT. Managed cloud services reduce the burdens of managing hardware and maintaining software, while ensuring network performance and compliance standards are met with minimal internal staff.

The 4 types of cloud computing

There is more to “going to the cloud” than determining whether your business is best served by building its own private cloud, using a public cloud services provider, or employing a hybrid solution. Businesses must identify the type of service(s) and the level of control they require:

Infrastructure as a Service (IaaS)

  • Most of the computing assets such as network routers, servers, processing power, and data storage arrays are managed by a third-party with applications presented as a remote service, relieving the business of responsibility for building a physical onsite IT infrastructure (aka private cloud). 

  • The business equips its workforce only with endpoint hardware (PC, laptop, or smart device). 

  • Resources can be scaled up and down on demand, with users paying only for services consumed. 

  • Example: Amazon Elastic Compute Cloud (EC2).

Platform as a Service (PaaS)

  • Provides developers with a complete framework and infrastructure for building custom applications online with all resources provided to run the application at peak performance, including resource procurement, data storage, and data serving.

  • Scripting tools for software design and development automate tasks and allow developers to focus on writing code and the deployment of new applications for faster time to market.

  • Example: Google App Engine.

Software as a Service (SaaS)

  • Hosts fully-functional software applications through browser-based interfaces and makes them accessible to users through the Internet on demand. 

  • Updates are managed by the CSP and are free of charge; hardware incompatibility issues are eliminated. 

  • Businesses save money by not having to license, download, and upgrade software applications on every device for every user. 

  • Devices can be thin-clients as the application hosting, processing power, and data storage functions are executed in the cloud, saving even more on hardware.

  • Example: Microsoft Office 365.

Functions as a Service (FaaS)

  • A new serverless computing concept that allows developers to create and deploy an individual function or a piece of a larger application to remote users without the need to maintain a server. 

  • Allows businesses to address very specific elements of code rather than having to rewrite entire applications and manage server logistics. 

  • Example: Microsoft Azure Functions.

A mix of any or all of these services can be accessed through a public cloud, a private cloud, or a hybrid cloud environment. It all depends upon business goals and objectives, and how to best complement the skills or services that do not exist organically within the organization.

Choosing the Best Cloud Computing Model – and Partner

Cloud computing has revolutionized how we do business as it frees organizations to focus on their core objectives instead of managing and maintaining technology. 

  • Employees get the technologies, tools, and applications they need without businesses suffering from traditional infrastructure limitations and spiraling support costs. 

  • Your customers get greater responsiveness as you can devote more resources to focusing on them.

Cloud computing can also level the playing field for smaller businesses lacking the budget and/or IT resources of larger competitors. SMBs can leverage it to streamline business processes and compress time to market for new applications, help meet the challenges of delivering an excellent user experience to remote or hybrid workforces and enhance team-based collaboration. In short, cloud computing gives enterprise-level technology to businesses of every size.

But to get the biggest benefit from a managed cloud service, you need to find the right managed cloud services provider with expertise in the needed types of cloud computing services.

We explore what to look for in a cloud partner in our article, “What to Look for in a Managed Cloud Service Provider?” A quick summary is that you want:

  • Expertise

  • A proven track record

  • Well-defined SLAs

  • A variety of services that will allow you to scale

Read more about managed cloud services: 8 Benefits of Managed Cloud Services.

Do you need to ensure a smooth migration to the cloud? Check out the related posts throughout this article for more information, or speak with a Ricoh cloud services professional to begin your digital transformation.

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