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October 02, 2012

The State of Cloud Computing: The SMB Perspective

By Erin Harrison, Executive Editor, Cloud Computing

While most enterprises have the resources to continue to invest in on-premise computing, in an uncertain economy, small and medium-sized businesses (SMBs) are dealing with reduced budgets and fewer resources. But the emergence of cloud computing is presenting this segment with attractive IT options, whether it’s for enterprise resource planning, collaboration, operations or networking and security needs.

To be competitive against larger enterprises with unlimited IT budgets, SMBs must be armed with the right information to guide their business appropriately. For many, cloud represents the opportunity to exceed goals and change the competitive landscape.

At the Cloud4SMB session, “State of Cloud Computing: The SMB Perspective,” Stephanie Atkinson, managing partner and co-founder of Compass (News - Alert) Intelligence, provided an overview of the market and discussed how cloud can help SMBs build their business.

“There are so many different aspects to cloud today – cloud is starting to touch every component of the IT industry. It’s an interesting market. For us, it’s not something you can quantify as a standalone market,” Atkinson said.

As evidenced by the latest statistics, more SMBs are trying to understand three primary cloud models, which are: Platform- as -a -Service (PaaS), Software –as- a -Service (SaaS (News - Alert)) and Infrastructure- as- a -Service (IaaS).

On the vendor side, cloud service providers have a significant opportunity based on the latest data compiled by Compass Intelligence, which found that in 2012, SMBs will spend $16 billion on cloud computing and services. Furthermore, the company predicts that the segment will spend $55 billion on cloud by 2016.

One of the biggest drivers of cloud is the ability to reduce capital expenses

“Businesses are really starting to look at ‘where can we offset our monthly expenses?’ We want to get rid of these capital expenditures and move these to more of a day to day expense,” Atkinson said.

There is a lot of activity in the cloud space whether you are a vendor or a small to medium sized business. According to recent survey data compiled by Compass Intelligence, 55 percent consider cloud a new way to gain access to information or media using the Internet from anywhere. Furthermore, 42 percent cite accessibility as a key factor for adoption.  

What are SMBs looking for? More than half said they are interested in purchasing clouds online. According to the survey, 43 percent of businesses with more than 100 employees are interested in website hosting, meanwhile 39 percent are interested in deploying hosted e-mail and 40 percent are interesting in Web conferencing.

Looking ahead, as Atkinson summarized, by and large, SMBs need more education about the benefits of cloud computing in order to make an informed decision. “They don’t know enough about cloud to invest in it,” she said.

Based on the survey’s findings, cloud is bound to infiltrate industry specific applications and areas. But SMBs need the education to make the right decision and develop a strategic cloud management plan.

“Cloud is not just about one solution, it’s about a lot of solutions coming together,” Atkinson added. “They are looking to cloud to compete in the industry or make them more competitive. SMBS need support and planning from the vendor community. They are not very well-educated. They are not sure as to what all the solutions are out there. That’s where the vendors come in. They need to be able to step up with support for development of these plans.”

Want to learn more about cloud computing solutions geared specifically towards small to medium-sized businesses? Don’t miss the Cloud4SMB Expo, collocated with ITEXPO Austin 2012 happening now in Austin, TX. Stay in touch with everything happening at Cloud4SMB Expo. Follow us on Twitter.

Edited by Brooke Neuman
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