Every Cloud Has A Silver Lining… Eventually.

cloudsCloud is one of the tech buzzwords of the last few years but how many of us really understand, and use, “the cloud”. If we accept that the definition of cloud computing is the use of computing resources that are delivered over a network, then we are all using the cloud every time we use an app on a network connected device that has to contact a server somewhere.

In the real world though, cloud computing means storing your files online if you are a consumer or offering file storage or apps that run on distributed online server networks if you are a provider. Taking the provider scenario first, there are two levels of cloud computing. The first, offering a server/app online, has actually been around for a long time. Websites and mail servers are examples of pure cloud computing.

These days, though, cloud computing is being used to describe a distributed network of servers delivering services online. I recently moved one client’s 60 or so email accounts from their own exchange server in their office to Giacom’s “cloud hosting” exchange service. For just £2.99 per user per month, the client’s employees had access to the latest exchange server mailbox features without any of the headache of running and maintaining their own server hardware. Hosted exchange isn’t that new but Giacom have embraced the cloud properly and have three different servers available to run each mailbox – two in their primary server centre and one in a backup server centre just in case.

Most non-geeks may be surprised to learn that Amazon are one of the biggest suppliers of cloud computing to companies. Amazon Web Services (AWS) provide the backbone to some very big online names; Netflix, Pinterest and Instagram are just three companies who use AWS to enable them to quickly scale their business to meet fluctuating demand. AWS and their competitors are the real reason that new online businesses can grow so quickly. Amazon created their own server farms and online services to enable them to scale their online business and quickly realised that they could rent their spare server capacity to other people. Google and Microsoft are two other major providers, unsurprisingly.

netflix-logo1Netflix is a great example of a business taking advantage of cloud computing. Originally launched in 1997, Netflix launched as a postal dvd rental service. Customers used the Netflix website to order movies and Netflix sent them the physical disk on loan. By 2005 Netflix were sending out 1,000,000 movies a day – purely to US customers. In 2007, in a move that Blockbuster must now envy, Netflix started offering online, streaming movie rental. Today they have 33 million subscribers worldwide and their rapid online growth is made possible by renting online services from AWS. They frequently add new countries to their service – for example they launched across Scandinavia late last year. they can do so by picking up the phone to AWS and ordering some more storage and bandwidth. Imagine if they had to set up their own server farms and local caches to meet demand – their growth would have been a lot slower and the capital investment would have been huge.

For the consumer, the best example of cloud computing is iCloud. Apple’s service combines traditional online services such as email and calendars with new services such us iTunes Match, which enables subscribers to access their music collection online anywhere on any device. Whilst email and calendar services are free (as long as you buy an apple device), Itunes Match costs £25 per year.

The Match service is a neat online solution. Apple worked out that they already have most of their customers music in their servers already. So they don’t have to upload 95% of the tracks that subscribers want to access. The £25 charge more than covers their licensing fees and the cost of uploading the few obscure tracks/albums that you have either imported from a cd or from other more nefarious sources.

Unlike Netflix, Apple are building their own new server farms – but they do need to spend their cash reserves of US$137billion on something.

Another simple example of cloud computing is Box. Anyone can get 5gb of online storage completely free of charge. If you are clever and take advantage of their special offers then you can increase that to 50Gb for no charge. They offer free storage to private users as a way to promote their business offerings, where companies can subscribe to group storage plans.

So, after a few years of talking about “the cloud”, we are all now really using it – either directly as an Itunes Match or Box subscriber or indirectly every time we open an email or watch a tv show on Netflix. My only concern is the reliance upon a few large cloud suppliers. They all promise and guarantee redundant backup provision but a 99.9% uptime guarantee still means that you can be offline for 8.75 Hours a year – and how much do you want to bet that those 8.75 Hours are just when you want to watch the new House of Cards on Netflix?

Jim Graham


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