Cloud Computing Is Silver Lining in Tough Economy

A recent report from Strategy Analytics notes the growing importance of cloud computing - both as a real-time networking tool and as cost-saving, recession-response measure.

Cloud computing is a hosted information technology format in which software is provided as a service over the air and data is stored on remote servers; enterprise users need little more than a device and an Internet connection, which enables workers and even businesses to be entirely mobile. There's no server room to be tied to. 

Click here to read a Forrester report on cloud  computing.

Google Apps, Salesforce.com, Microsoft Office Live and Intuit QuickBase are all popular examples.

Cloud computing is still young and developing, however, and businesses and individuals are still figuring out how to cope when these systems, out of their hands, go down. On Feb. 24, Google's Gmail went down for three hours at the beginning of London's workday, disrupting Goople Apps and barring millions from their e-mail.

Amazon's Simple Storage Service crashed twice in 2008, each time for a few hours, and in mid-February, Nokia's Ovi social-networking service crashed after a server overheated, wiping out three weeks' of user updates.

Lack of control over their data, as well as security concerns, have been the main issues keeping many businesses from moving toward hosted solutions, studies show.

A Feb. 24 study commissioned by consultancy Avanade revealed that "by a five-to-one ratio, executives report they trust existing internal systems over cloud-based systems, due to fear about security threats and loss of control of data and systems."

And a "2009 Cloud Computing Trends Report" commissioned by Hosting.com similarly found that 64 percent of all respondents and 75 percent of larger companies named security as their top concern. Large and small businesses, however, turned to cloud computing for the same reasons: a reduction in costs, uptime, scalability and performance.

In these challenging economic times, the cost-savings that cloud-computing offers - users generally pay by the seat, and server costs are the worry of the host solution - may prove enough to push many companies past their security fears and toward adoption.

"The economy, yes. But the portability of information is the other thing," says Philippe Winthrop, also with Strategy Analytics.

"Portability is the flipside of the security issue. People need to be mobile and have their data everywhere. For a lack of a better term, they're willing to compromise on the security issue, and so we're going to see -mobile' cloud computing adoption grow."