The Economic Benefits of Cloud Computing

Cloud computing can be used for almost all types of applications, not just business security. While the idea of operating “in the cloud” can sometimes seem hard to grasp, it’s clear that it saves its users money – especially SMBs, including small office/home office (SOHO) – and you’re probably doing business in the cloud already and you don’t even realize it.

Read on to discover five reasons why moving to the cloud will save you money and improve operations:

Scalable hardware means you pay for what you use

Cloud computing brings natural economies of scale. The practicalities of cloud computing mean high utilization and smoothing of the inevitable peaks and troughs in workloads. Rather than using a dedicated server that you own, maintain, and pay for regardless of demand, your workloads will share server infrastructure with other organizations’ computing needs. This allows the cloud-computing provider to optimize the hardware needs of its data centers, which means you’re not paying for idle infrastructure which results in lower operating costs.

You’ll save money on energy costs

Cloud computing uses less electricity. That’s an inevitable result that comes with scalable computing: Better hardware utilization means more efficient power use for your business. When you run your own data center, your servers won’t be fully-utilized (unless yours is a very unusual organization). Idle servers waste energy, which means that regardless of demand, a cloud service provider can charge you less for energy used than you’re spending in your own data center.

You’ll save money by streamlining your workforce

Whenever we analyze an organization’s computing costs, the biggest single line item is often the staffing budget, which can make up more than half of the operational cost for a business.

What makes this amount so high? Good IT people are expensive; Their salaries, benefits, and other employment costs usually outweigh the costs of hardware and software and that’s before you add in the cost of recruiting good staff with the right experience.

When you move to the cloud, some of the money you pay for the service goes to the provider’s staffing costs. But it’s typically a much smaller amount than if you did all that work in-house. Yet again, we have to thank our old friend: economies of scale.

This doesn’t mean that you’ll be forced to downsize your current staff, but rather, you’ll be able to efficiently improve your IT department’s operations by deploying staff to other areas of your business, improving your bottom-line capabilities.

Zero upfront costs

When you run your own servers, you’re looking at upfront capital costs, but in a cloud-based model, financing that capital investment is someone else’s problem.

Sure, if you run the servers yourself, the accounting wizards do their amortization magic which makes it appear that the cost gets spread over a server’s life. But that money still has to come from somewhere, so it’s capital that otherwise can’t be invested in the business—be it actual money or a line of credit. With cloud-based computing, there’s far less variability in cost as your business scales, removing a significant barrier to growth.

Resilience without redundancy

When you run your own localized data centers and servers, you need to buy more hardware than you need in case of failure. In extreme cases, you need to duplicate everything. Having spare hardware lying idle, “just in case,” is an expensive way to maximize uptime.

Instead, why not let a cloud computing service deal with the redundancy requirement? Typical clouds have several locations for their data centers, and they mirror your data and applications across at least two of them. That’s a less expensive way of doing it, and another way to enjoy the cloud’s economies of scale.

Plus, it’s good for the environment (and it saves you money, too)

Whether or not they believe in global warming, many organizations want to do something about it. This is either because their customers want to do business with green companies, or simply through a genuine desire to emit less CO2, or other gases believed to warm the planet.

By moving to the cloud, you’ll be greener in two ways. First, you’ll be saving energy, which as previously covered, saves you on your operating costs. Second, you’ll be taking advantage of the work that your cloud service provider has done to reduce its data centers’ carbon footprint. Think of it as saving money that you might otherwise spend on carbon offsets.

It’s Reality

Cloud computing is now a proven, mainstream alternative for SMBs and SoHo. Moving to the cloud will save you money, not just for your cloud security needs, but for many other types of data center workloads. Webroot was the first cybersecurity provider to migrate to the cloud back in 2011. The move allowed us to provide our customers with extremely lightweight software that’s able to fend off threats without hogging space or slowing you down.