Innersync Studio Blog

Is this the year for Software as a Service?

February 16, 2009

Cloud computingLets face it, a bad economy is all about moving forward and spending less. In a good economy, the conditions are much more forgiving when you are gambling your investments. So where does cloud computing come in? It is the answer to many organizations trying to keep up with latest technology and not have a big up-front investment. The beauty of cloud computing is not just the savings but how fast the technology advances. Take a look at Facebook, it rocks, even the most unpopular dude in you high school class has 100 friends. Cloud computing is finding its way into organizations because it is cheap in comparison to installed software solutions and it evolves much faster. According to CNN.com "4 tech predictions for 2009," one of the four predictions is the advancement of cloud computing.

Organizations are now recognizing that the price of buying and maintaining software/hardware is just not cost-effective if there is a good alternative. The web is moving rapidly and our culture is changing. I just heard the slang term, "computer potato" and before long it will probably beat out couch potato in usage. Employees are now living their personal lives through social "freemiums" and organizations are looking for ways to tap into Web 2.0 technology to leverage that power.

Cloud computing represents an estimated $36 billion in the business market and 13% of global sales, and it is moving up, not down. This shift in thinking is a really big deal. We are facing extraordinary times and we may require a culture change on how we do business. Here at Innersync, we have been running a cloud for about 1 1/2 years and it is paying off. Our goal is to provide powerful, positive experiences to our customers, so we need to evolve our technology as easy and as quickly as possible. The cloud concept is the way we achieve this. One update, many users, one time.

As an example of this trend, recently San Francisco-based Genentech Inc. embraced Google Apps and is spending an estimated $800,000 annually (based on $50 per user) with Google compared to $70 million for a data center. And that did not include the rent-a-cops to watch the green protesters or the people to manage it. What does this mean? Technology is coming of age and people are weighing the options. I would think this is great concept even if I didn't make a living with this stuff. I am simple, give me a choice of affordable, evolving technology or a costly software/hardware implementation and I am going to base my decision on the end result with the best value.

Web 2.0 has taken on such a life of its own and it is so amazing how it has brought people together. When I think of the evolution of web technology, it is not the Microsoft model of installing software updates on a million computers. It is concepts like Google, Facebook, Twitter, LinkedIn and the others goodies we all love to use. I was talking to our friend Brock Brown who manages several technology companies, and he said "I do all my work in the cloud, so I can get by with less expensive software and hardware options. This cost savings is then passed on to my client base." So why would you think of any other way for your organization? When we think of schools that are struggling with budget cuts, we think they have cloud computing written all over them. Put a $200 laptop in every kids' hand and set them up with collaborative web publishing. Call your work done.

The moral of the story is that if you like great technology that brings people together, keeps CPU's running cool and lets you focus on the results vs. your investment, then maybe cloud computing is the answer for you.

Tags: cloud computing , Social media , web content management

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COMMENTS

Accepting the cloud is definitely a step in the right direction. Although the cloud is not the best fit for every scenario, its important to recognize this as a viable option in the right situations. In addition to the overall cost savings, there may also be specific cost reductions with regards to supporting an application that is hosted.
Bill Palmer 1:47PM 03/05/09
Good point, Gavin. I'm glad you voiced it because, maybe it's not safe to assume anymore that people will adopt and implement technology "responsibly" for lack of a better term. Of course, when it's used as needed, it can work well. But if others are jumping full-force on to the bandwagon just out of fear of falling behind, disaster can ensue.
allmorgan 1:34PM 02/17/09
I think if people phase the cloud in, rather than jump in feet first, and find where it fits and doesn’t, they will over time move more and more that direction.
Gavin Durman 8:36AM 02/17/09

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