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Even beore the current recession, businesses were acing dual pressuresto both reduce their operational budgets and more importantly reduce orremove expenditure on capital items. Tese dual actors have encouragedorganizations to look to cloud computing, and in particular cloud basedapplications which meet both o those objectives. Cloud computing solutionstend to have a lower total cost o ownership (CO) than traditional onpremise applications in part due to the greater economies o scale that cloudcomputing vendors enjoy - these economies o scale are created by usingshared inrastructure, distributed over all users. Cloud computing solutionsalso include the cost o any upgrades and maintenance in their subscriptionpricing, whereas with traditional on-premise sotware, maintenance is anextra cost borne by customers. Te on-demand nature o cloud computingsolutions also means that customers can increase or decrease their usagerapidly, thus enabling them to reduce their costs quickly in a downsizingsituation.In the case o small and medium businesses (SMBs) ordiscrete business units o larger organizations, theseentities tend not to have the complex, highly structuredneeds o large enterprises. Cloud computing solutionstypically have a eature set that is scalable both up anddown, giving these organizations the ability to grow intoincreased complexity as their needs change.Finally, cloud computing solutions tend to ofer ree trials and other optionsthat give organizations an extremely low barrier-o-entry into the product.Tis is in direct contrast to traditional on-premise sotware, which is gearedtowards large, out o the box investment and lengthy implementation cycles.
Cloud computing solutions typically have a feature set that is scalable both up and down, giving these organizations the ability to grow intoincreased complexity as their needs change.