Cloud computing. It is impossible to be a geek in the business world and escape the latest news on cloud computing. Every magazine, newsletter, and website I use to do research for Mavidea customers keeps doing their best to sell me on cloud computing. I'm used to it – we geeks love new technology -- a lot of times far more than our ends users do. Normally these ideas burn brightly for 6-9 months and then just fade away, but cloud computing seems to have a fuel that refuses to die. Cloud computing articles are showing up in trade magazines for attorneys, accountants, benefits planners, and manufacturers. Instead of me introducing these new technologies to our customers, they are asking me about them.

Why this change in the adoption cycle? My guess would be that the economic conditions of the last 24 months have most business owners looking for any way to cut or curb costs in their business. Want to guess what cloud computing articles are pitching to those same owners? You got it – reduced costs. Does cloud computing reduce costs? Well…sometimes.

That leads to the bigger question – what is cloud computing? That seems to be the magic question. No two companies or industry trade groups seem to be able to come up with the same definition. I participated in an industry forum for CRN Magazine last year where 10 CIO / CTOs attempted to address some of the fundamental questions and concerns surrounding cloud computing. Every one of us had a different idea of what cloud computing is.

Of all of the definitions I have seen, I think Wikipedia's is the best:

"Cloud computing is Internet-based computing, whereby shared resources, software, and information are provided to computers and other devices on demand…"

The premise is simple – let's break down the definition into pieces.

"Internet-based" – Cloud computing moves the software out of your office out onto the Internet "cloud". The software could literally be housed in any datacenter in the world, although our use will mostly be based out of US datacenters for speed. All access to the data will be from an Internet connection – it could be at work, home, a hotel, or a coffee shop down the street. The promise is as long as you have Internet access you can get to your data.

"shared resources, software, and information" – Most servers located on site at small to midsized businesses have an average utilization of between 5-20%. Do you really need to purchase new hardware if you are only going to use 15% of it?

"provided to computers and other devices on demand" – This is probably the most exciting part of cloud computing to business owners. For years companies have purchased software and hardware to run applications inside their businesses. These purchases were almost always followed by significant staffing or labor costs to ensure the successful installation of the purchases into the company's infrastructure. And then because of the nature of upgrade cycles, do it all over again in 4-5 years.

Now with a new wave of cloud computing applications (email, spam filtering, CRM, sales management), virtual hosted servers, and online backup, businesses will be able to pay for some (or all) of their needs on demand. A lot of times the fee is per user per month. Just hired a new employee? Click a few buttons to add the new user to your account. Going in to the busy season? Fire up another virtual server to handle the extra processing load. Don't have trained staff to run the new application? No problem – the cloud provider is going to provide most of the support you need.

Your bookkeeper / accountant is going to love the "on demand" part too. Instead of a giant capital expense on front of the project, and then depreciation each year, cloud computing will change a lot of things over to an ongoing operating expense. I'm not saying that cloud computing is cheaper, but would you rather spend $10,000 up front every 4 years or $400 per month (example numbers) to run the same application? What else could you do with your money if it wasn't tied up in computer hardware?

Now with all that being said, cloud computing is not a perfect world. There are some situations where cloud computing is not a fit. Not every application or every server will be able to be moved to the cloud, for a variety of reasons. Many industry analysts predict that most companies will end up in a hybrid mode – moving as many servers and applications as they can into the cloud, but some special items will be forced into an on-premise solution.

Of course there is also the situation where you have no Internet access. No Internet means no access to anything you have residing out in the cloud. What if the only Internet access you can get is slow? Cloud computing may not be the solution for you.

I have a good deal more to say on the subject of cloud computing regarding security, stability, usability, and disaster recovery. Let's call this an introduction to cloud computing. This fall Mavidea is officially unveiling our lineup of cloud offerings under the brand SIMPLICITY. Look for many more articles on cloud computing to be posted on the official Mavidea blog over the next couple of months as we review the benefits and challenges of using cloud solutions for email, spam filtering, email encryption, compliance archiving, virtual servers, and virtual desktops.