Will the Cloud Level the Playing Field for SMBs?

Thursday, May 30th, 2013

One of the biggest strengths of cloud computing is the economies of scale it offers, but security (real or imagined) has always been an issue. However, IBM came out with a report that shows for the first time that the critical hurdle of security is no longer a major concern for small to mid-sized businesses who are considering using cloud services. In response to this, the report also shows that the SMB market is planning to move mission critical applications to the cloud in the upcoming year.  These are significant changes in the cloud landscape that many have said represents the cloud’s “tipping-point.”

The report from IBM looked at more than 1,200 “technology decision-maker” professionals (22 percent IT managers, 53 percent IT practitioners and 25 percent business professionals). The idea behind the survey was to better understand how technology trends are impacting the future for IT professionals.

Once the technological hurdle has been eliminated for small and medium businesses (SMBs) to affordably access and manage enterprise class technology, the question then becomes how will that affect the SMB market? According to Ed Abrams, IBM’s VP of marketing and strategy for SMB, IBM’s research showed that utilizing the cloud could save organizations from 25% to 30% or more. A 30% savings for small business owners not only frees up capital for other growth opportunities, it also reduces the barrier of entry of ideas into the marketplace. A report from Forbes supports the idea that the cloud will spark growth and innovation for SMBs. But SMBs need to move swiftly in order to gain their fleeting competitive advantage over their conglomerate counterparts. Large corporations like Royal Dutch Shell are beginning to adopt the cloud for the same reasons as SMBs, efficiency.

Another question is how far will cloud computing go? Right now much of the talk is about cloud applications like Salesforce and Google Apps. But what about platform-as-a-service (PaaS) and infrastructure-as-a-service (IaaS)? Last year, Google CIO Ben Fried stated in in the Wall Street Journal, “The next wave” of cloud computing will enable the sharing of the environment to run those applications. You will be able to take advantage of what we had to build in order to create those applications.”

This is not to say that your neighborhood hardware store is going to compete, one-on-one, with Home Depot. However, with the right combination of cloud computing applications and platforms, your neighborhood hardware store may be able to run as efficiently as Home Depot for a fraction of the cost.

What do you think? How do you think cloud computing with affect SMBs?

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