Approach towards Cloud Computing For Startups

14th Jan 2011
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In Recent times, cloud computing has become the major facilitator for startup companies. According to IDC’s(International Data Corp) estimate, a figure of 16 billion dollars has been invested by SMB’s in cloud computing in the year 2010. This figure is expected to rise to $56 billion by 2014.Cloud computing is more suitable for startups than established companies as they have a smaller investment in existing physical infrastructure and applications, which would be replaced by cloud services. It also assists in solving the vital limitations of startup companies, of time and money. It allows entrepreneurs to rent out infrastructure: servers, bandwidth, rack space, firewalls, switches, test environments, production environments, email services, invoicing systems, and CRM systems; instead of buying them and dispensing resources on their management. Cloud computing provides elasticity and flexibility to the startup’s operation causing it to cut back on costs of excess infrastructure, in the case of fewer consumers in a lean period and allows it to rapidly shift to more resources in a boom period. Adding to this, cloud computing is a lot cheaper than traditional methods. It also makes collaborative work more simple and provides benefits of

  • Reduced organizational costs of infrastructure and workforce
  • Increased storage capacity.
  • Mobile access.
  • And a positive cash flow system (payment to cloud service provider after usage of service)

However, there are a few points to be taken in consideration in order to assess the manner and extend of adoption of cloud computing. First of all, startups which deal with sensitive customer information like matrimony sites or business strategy development firms should not opt for using cloud computing for data storage, as customers might be reluctant and leaks in cloud computing are improbable but possible over the internet. Secondly, for startups dealing with large amount of data, it would not be economic or time efficient to create large backups over bandwidths on the internet, and to send and receive data over internet connections respectively. Thirdly, in some cases custom hardware and software is required which cannot be installed on the systems of cloud vendors.

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Also, the Total Cost of Ownership (TCO) of adopting, monitoring, automation and management of cloud computing  should be estimated before utilizing their services. Although it is unlikely to exceed costs from traditional methods, but since startups work on constrained budgets, it should be carried out.

After the above criterion and assessments are considered , if a startup company thinks it should engage in cloud computing or partially engage in it(hybrid computing), it should develop a plan of adoption. It can use the staff previously engaged in IT maintenance for the operational and management teams to ensure smooth back and forth motion of data between company and clouds. Even after data has been dispatched to the clouds, startups still need to monitor it as they are responsible for security and privacy of the data and there is a possibility of data loss or server problems from the cloud vendor. Companies should also give customers non cloud option of their service so as to not lose customer faith. It would also be advisable for startups to develop internal clouds for availing cloud advantages on a smaller scale without the security concerns.

RESOURCES

http://www.launchany.com/ ebook ---cloud computing for startups

http://mytwoandahalfcents.com/?p=84

http://gigaom.com/cloud/how-computing-impacts-the-cash-needs-of-startups/

http://blogs.computerworld.com/16863/cloud_computing_by_the_numbers_what_do_all_the_statistics_mean

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