Cloud computing is a term used for applications and other IT services available over the Internet. It’s when the Internet is your hard drive or server. It’s also how a growing number of organizations aim to save money, reduce their software and hardware needs, and go green. As more applications and services move to the Internet, your organization needs to know the benefits and pitfalls of cloud computing to decide if the cloud may be a good tool for you.

What is Cloud Computing?

Most of us have a Gmail, Yahoo mail, or Hotmail account. And maybe we’ve dabbled in using shared online documents like Google Docs. Those online tools are all considered cloud computing. But it goes far beyond these basic tools — organizations can use the cloud for IT tasks ranging from backing up data to online databases.

A defining feature of cloud computing is that the services are provided or hosted by someone else. The service is sometimes free but often on a pay-per-use or subscription basis for Enterprise class solutions. And if your organizations is concerned about its carbon footprint, cloud computing is usually the greener option. The cloud moves IT infrastructure away from your local network to large data centers, reducing energy use and the need for power-hungry in-house servers.

Will Cloud Computing Affect My Organization?

Cloud computing is changing how all of us work and how we use technology. It’s likely you’re already using cloud services or applications like Skype or Microsoft Office Web Apps. As your organization evolves, you’ll need to know when to use the cloud and when a desktop application may serve your needs better.

For example, if your office needs a new CRM or ERP system, will only one person be entering the data? Will many? If the data will be shared widely, a cloud solution might be a better option. The cloud lets anyone access the information from a browser, without the specific software or internal server access. The same cloud-versus-desktop dilemma is happening with word processing and office productivity applications. Microsoft Office is an excellent desktop tool, but Office Web apps offer similar functionality in online applications.

What You Need to Consider

Because cloud technologies will phase in over time, it’s important to know which ones are mature, affordable, and work well for organizations, and which ones are still in their infancy. As with any new technology, it’s not perfect. There are factors to keep in mind as you consider transitioning to cloud services:

  • You need broadband Internet. Without broadband, cloud services will drain your time and bandwidth, and some may not work at all.
  • You’re dependent on the companies that host applications to maintain them and to keep user data intact and protected.
  • If you don’t have access to the Internet (due to travel, computer issues, network outages, and so on) you don’t have access to your files, documents, and other important systems.

Perhaps the best way to learn what to expect as your organization adopts more cloud services is to see how other organizations are already adopting cloud technologies.

Customers are Moving to the Cloud

Research shows that companies are allocating an increasing percentage of their IT budgets to cloud services to help them meet these demands.

By 2015, AMI reports that companies will spend up to 12.2 percent of their IT budgets on cloud services, a nearly 50 percent increase over the percentage they spent in 2010.

Here are just a few companies currently embracing the cloud