Premium content from Houston Business Journal
Date: Friday, January 7, 2011, 5:00am CST
In a memorable scene from â€œIt’s A Wonderful Life,â€ Jimmy Stewart’s character pleads with panicked customers of the Bailey Savings & Loan not to withdraw their money in the wake of Wall Street’s crash.
â€œYou’re thinking of this place all wrong, as if I had the money back in a safe,â€ Stewart’s George Bailey said. â€œThe money’s not here. Your money’s in Joe’s house. … And in the Kennedy House and Mrs. Macklin’s house and a hundred others.â€
If Bailey were around today, he might know how to explain cloud computing.
Technology experts say the days of businesses storing data on physical servers in an air-conditioned closet down the hall are coming to an end. Rather than buying and maintaining expensive hardware on site, companies are turning to data centers and cloud service providers like Microsoft, Salesforce.com, Amazon and Google.
The concept is simple enough: If information is currency, why stuff it under a mattress when you can put it someplace safe and let professionals manage it for you, making deposits and withdrawals at any time?
Yet cloud computing is a fuzzy idea to many in the business world who are reluctant to â€” even fearful of â€” embracing it.
Here are some additional George Bailey-like descriptions from Houston-area experts on a cloudy subject:
A giant table
Dayna Steele, Small-business consultant, author and speaker, Steele Media Services
Imagine the cloud is a big table on the other side of your office. Everything you need is on the table. When you need it, you go get it and bring it to your desk. When you are through, you can put it back on the table and get it anytime you want it in the future. You only have what you need on your desk at any given time. The giant table with everything you need is the cloud, and the desk is any computer you happen to be at anywhere in the world with Internet access. You can always get what you need off the table.
A rental computer
Lilac Schoenbeck, Senior manager of solutions marketing for cloud computing, BMC Software Inc.
There are times when your computer runs slowly or when it isn’t sufficiently powerful to handle a certain type of calculation. For example, if you were running scientific calculations or financial calculations. Or if you were trying to play a video game that was very big.
What you’d like, then, is to borrow some of someone else’s computer. Just for a small period of time. You aren’t going to want to buy a big old computer to help you, since you don’t need it forever. You just need it in small bursts â€” and that whole big computer is really expensive, so you just want to rent it. Of course, you can’t really haul the thing around the world, shipping it here and there. Instead, you can connect to it when it is elsewhere. Like the Internet. You connect to your e-mail, and that’s not on your laptop. That’s elsewhere. You just have a window into it. Cloud allows people who have this need for extra computing power to rent it, using something like a browser window to create an account, ask for some power, use that power, and then give it back. And they pay for what they use.
Doug Erb, Partner and cofounder, Canidium LLC
Technically speaking, cloud computing provides the opportunity to â€œleaseâ€ software applications. Just like Facebook’s Farmville game, users are able to experience building a farm but don’t have to buy the actual land, cattle and labor to support it.
Leasing software versus buying software allows small to midsize businesses opportunity to operate like a big business, without the expense. Cloud computing is most often used at the enterprise software levels specifically around analytics and business intelligence. Traditionally, small companies have a severe disadvantage operating and competing in multiple markets â€” but by taking advantage of cloud computing applications, they can leverage systems and data to their fullest capabilities to operate more strategically.
Software applications in the cloud can be leased via a usage basis or flat-fee contracts. A typical enterprise-level sales-performance management application could cost over $250,000, in addition to the hardware and IT staff required to run it. With the cloud, the only hardware required is a computer to access the internet â€” and the cost of the application can be reduced to under $50,000 annually.
Bob Skiba, President, CloudReplica
The best and easiest example of cloud computing is online banking. You access the bank’s software program over the Internet, and you can track your deposits, withdrawals, pay bills, and transfer money â€” anytime and anywhere you can get an Internet connection.
Another great example is the various online e-mail products â€” Yahoo, Gmail, Microsoft Live, and others â€” all are accessed by the Internet. You can send and receive e-mails, anytime, anywhere. These early examples are free of charge and convenient for consumers. The cloud computing term started to take form when business-based, for-fee solutions started to emerge.