Cloud computing and the changes to business outsourcing
If you only equate Amazon.com® with books, movies, music and retail items, you might be surprised to learn they are growing as a popular cloud computing provider. As companies look for new ways to reduce costs and maintain revenue, one way they're are saving money is by outsourcing data and IT services to a cloud provider.
Cloud computing
Cloud computing provides businesses the flexibility of accessing resources on demand without having those digital resources stored locally. Cloud computing offers IT staff the ability to control resources and handle workload demands as they increase. The virtualization scenario maximizes hardware capacity and eliminates single-purpose systems because multiple virtual machines are housed on one server.
In a cloud, hardware components include servers, storage and networking hardware. Cloud providers offer a host of services and various server sizes and capabilities for companies. Providers offer various CPUs, RAM and hard drive storage. For example, package bundles may include a Dell™ PowerEdge™ server with two Intel® Xeon® 5120 DC processors, two gigabytes of RAM, two 250 gigabyte SATA hard drives, and bandwidth capabilities of 2.5 terabytes. Other options might feature six gigabytes of RAM or 500 gigabyte hard drives, depending on your requirements.
When selecting a cloud provider, start with your minimum requirements. On demand environments are designed for expansion, so you can always add more cloud servers. If performance declines, your cloud provider can review event logs from the operation system for errors or issues. Then, they can usually deliver a report that examines if the processors are being over utilized, or the RAM is insufficient. They should also be able to analyze the hard drives and determine if you need more space for data storage and running applications.
Cloud providers
In a cloud computing environment, you never know quite where the magic servers storing your data are located. They could be down the street if you are in Silicon Valley, or they could be across the ocean. American companies should actually feel more at ease if their cloud computing provider houses servers in Europe because the European government has stringent privacy laws compared to America.
For example, the U.S. Patriot Act allows the United States government and a list of other agencies access to company information for the protection of the country. In Europe, even email addresses are considered personal data.
However, providers such as Amazon, Microsoft®, VMWare® and Rackspace® are expanding their products and services and enhancing their compliance capabilities for companies with multiple requirements. In a report by Goldman Sachs, Amazon Web Services were used by 77 percent of the companies surveyed, follow by 17 percent of those companies using Google and 10 percent using Microsoft’s Windows Azure. Consequently, Amazon is the leader for cloud computing outsourcing.
Outsourcing tips
If you are considering a cloud provider, even with a major player like Amazon or VMware, ask to see reliability reports. Whether in-house or within a cloud, companies should make provisions for full outages and implement procedures for ensuring reliability.
For example, IBM® boasts about their reliable General Parallel File System (GPFS)™ platform, with the introduction of the Smart Business Storage Cloud design. This solution features a flexible offering of storage and boasts capabilities such as a data replication for quick recovery. This platform is designed to save your company money and reduce outages.
One of the biggest security concerns of cloud computing is safeguarding the data from other customers. With so many companies contracting with providers and sharing cloud space, companies want to know their data is secure. To protect your data and the integrity of the server from other customers, cloud providers can implement high levels of authentication, install SSL certificates, and even encrypt those certificates.
With compliance and security issues resolved, companies are adding cloud computing services to their annual budget as a replacement for hefty hardware and software additions, updates and repairs. By outsourcing with a cloud provider, companies can reduce overhead and concentrate less on pricey technology repairs and more on enhancing their products and services.
Resources
Humphries, J. (2010). Will Amazon hold the lead on cloud computing? CXO Europe.
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