Cloud file servers, business opportunity or competition for small IT firms?

So many vendors are now looking to “the cloud” as the solution and growth path for business involved in the SMB space. I mentioned in my blog post last week that Microsoft had killed EBS 2008 based on the growth of the cloud as a solution. This really makes me think a lot about the cloud movement and what it means to us in the future.

The cloud is seen by many vendors as a great solution to oh-so-many business problems. There are many fanciful claims about having your data and applications in the cloud, and it’s hard to tell fact from fiction at times.

About Cloud

The upside of cloud hosted applications and data is that it will always be available to you, from anywhere in the world with only the need for a web browser and an Internet connection. You won’t need to invest in expensive hardware to run your business. You won’t need to worry about maintenance of the hardware or software. You’ll only need to pay a fixed fee per month for it all. Sounds fantastic, doesn’t it? In reality it is pretty cool, but let’s think a little about that for a moment.

You ONLY need a web browser AND an Internet connection….

What connection speed will be acceptable? What happens when your Internet connection is down, maybe due to a cable cut in the street? How will your office survive if that is the case, given your email is all hosted externally now? Who else will have access to your data when it’s stored in the cloud? How can you guarantee compliance with the various regulatory bodies in respect to that data?

You won’t need expensive hardware to run your business or maintenance…

But you will pay a portion of your fixed monthly fee towards that as will everyone else who uses that service. Great in theory, but what happens if the vendor decides to skim on the expensive, reliable hardware to make more profit? Maintenance periods will be at the cloud vendors choosing now, not at yours. How will you cope if the maintenance period is at a busy time for you?

The fixed monthly fee is nice, too…

But what happens when the vendor who has your applications and data decides to increase the fee? Or decrease service levels that they give for the existing fee? How easy will it be to get access to your data and move it to another vendor or in fact back in house?

How about some other questions…

What happens to your apps and data when the company hosting them goes bankrupt? Who OWNS your data hosted in the cloud and what access would you have in those circumstances? What about where your data is located? If you are not a U.S. company and your data is located on U.S. soil, how much do you know about the Patriot Act?

Yes, I know. I’m asking a LOT of questions in this blog post and not providing many answers. That is the point; there are way more questions than answers and we as IT professionals need to be aware of these things when we go to advise our customers of the latest and greatest cloud solutions.

With all that in mind, what do you think the risk of putting all your data and apps into the cloud?

Cloud file servers and associated services are becoming all the rage. Dropbox and box.net are the two best known, but not the only ones. I like Egnyte because it does backup as well as file sharing. Then there are niche solutions like OfficeDrop, focused on scanning to the web, but also offering file storage. You can’t forget Google Apps Premier, if you’re willing to deal with helping your customers migrate to Google Docs and they are willing to accept the limitations.
So should we be pushing these solutions, and figuring out how to monetize our add-on services, or should we be fighting them tooth and nail, and trying to keep our customers on in-house Windows servers?

If they are appropriate, then if you don’t discuss cloud services with your clients then someone else certainly will. The key is “appropriate”. That may be a technological issue or a financial issue. I have discussed cloud services with two clients recently. Both ended up going with in-house proposals as they made sense either from a financial or a technical POV, but we are implementing cloud solutions for other clients.

The bottom line is: If you don’t have “cloud” in your portfolio someone else certainly will and they’ll take your clients off you.

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