Traditional business applications have always been too complicated and expensive to deploy and implement. Whether it is office space, power, cooling, bandwidth, networks, servers, storage, software stack, or a team of specialists to maintain the applications, the complexities get multiplied when you have hundreds of apps to deploy and an equal number of production and failover scenarios to consider. Therefore, big and small organizations needed an alternate computing model to stay ahead of the competition, to constantly innovate and to streamline operational costs. This is the reason for the phenomenal growth of the IT concept called – “Cloud Computing”

Cloud computing has emerged as a viable alternate delivery and acquisition model for IT related services, allowing organizations to leverage more on their actual competencies and optimize the overall IT cost structure. Cloud computing provides an infrastructure engine that helps an organization adopt an agile and lean approach in service delivery, regardless of whether it is to their employees, customers or partners.

Understanding Cloud Computing

Everyone in the technology space is talking about it. Professionals in business related domains are echoing similar sentiments and are asking the same question, “What is cloud computing, and what does it mean for my business?” Simply put, cloud computing is a computing paradigm that allows users to employ a subset of resources from a massive pool of hardware and network infrastructure managed independently, either within the organization, or externally by a 3rd party vendor. This computation capability is usually available as a “pay-as-you-use” basis, for example, as infrastructure-based, platform-based, or service-based, to deliver seamless, scalable business services.

The Value Proposition of Cloud Computing

Cloud computing thrives on the proposition of reduction in Total Cost of Ownership (TCO), enhancing business agility and the ability to build best in-class systems. The cost model allows organizations to allocate resources that can scale with the demand for peak loads, seasonal variations, fallbacks and just-in-time provisioning of alternate solutions.

The premise of cloud computing has won over the CIOs of some of the largest organizations across the globe. Many once skeptical executives never looked back after transitioning to a cloud-based model. Some of the benefits that cloud computing brings to the table for every organization are:

  • Easy and quick web services integration
  • World class service delivery with complete disaster recovery management and impeccable uptimes
  • No hardware or software to install resulting in less capital expenditure
  • Faster and lower risk deployment
  • Support for deep customization and application configuration

Cloud computing is more than just buzz and “cost optimization engine.” It is here to stay and is expected to disrupt IT operations worldwide in a massive scale. From a VC perspective, the good news is that cloud computing is still far from maturity. There are many technology gaps that are not yet filled, especially in the areas of cloud enablement, management, monitoring, and security.