Advantages and Disadvantages of Cloud Computing

Advantages of Cloud Computing

1 Scalability

Scalability is a key of cloud computing. The ability of the platform to expand and contract
automatically based on capacity on needs ( sometimes referred to as ‘elasticity’), and charging
model associated with this, are key elements that distinguish cloud computing from other
forms of hosting.

Cloud computing provides resources on-demand for many of the typical scaling points that an
organization needs including servers, storage and networking. The on-demand nature of cloud
computing means that your demand grows (or contracts) you can more easily match your
capacity (and costs) to your demand. There is no need to over-provision for the peaks.

At the software level cloud computing allows developers and IT operations to develop, deploy
and run applications that can easily grow capacity, work fast and never – or at least rarely –
fail, all without any concern as to the nature and location of the underlying infrastructure.

One shouldn’t forget the advantage cloud computing can offer newer or smaller players. With
easy access to a cost effective, flexible technology platform small competitors can punch well
above their weight in terms of application capacity and scalability and can quickly turn into
significant adversaries.

2. Cost Saving

There is still some debate about whether there are real cost saving with cloud computing.
McKinsey recently published a report claiming that there was no cost saving to be had and
that, on the contrary, it could work out more expensive. This report has since been debunked
by others claiming that it only focused on one (failed) project and that it didn’t accurately
reflect the true cost of running systems internally.

On the other hand, a report by Forrester emphasizes the fact that use of cloud computing
matches cash flow to system benefits more appropriately than the traditional model.

In the old way of doing things, a large investment is made early in the project prior to system
build out, and well before the business benefits (presumably financial in some shape or form)
are realized. This model is even more troubling given the risk factors associated with IT
 systems: they are notorious for failing to deliver their promised benefits, and a large
percentage of projects end up scrapped due to poor user acceptance.

With cloud computing you can move from a capital investment to an operational expense.

Whilst cost won’t be the only driver in the adoption of cloud computing it is often seen as the
key factor. Clearly if a decision to adopt cloud computing (or not) is to be based primarily on
potential cost saving then the true cost of operating an application internally needs to be
understood and this is something that most organization are not good at.

Many organizations home in on the cost of provisioning a server internally (including software
licenses) and end up comparing that with the cost of a cloud based solution. This inevitably
will lead to the conclusion that cloud computing is more expensive.

The problem with this type of costing is that it omits a whole range of costs that are often not
assigned to the internal server’s cost such as

a. Technical personnel necessary to keep a data centre up and running

b. Extra personnel necessary to manage server procurement
c. Utility bills and capital expenses investments for power and cooling
d. Internal technical people to do assessments and trials of different hardware offering
e. Procurement people to do the negotiating for hardware purchase
f. Internal and external costs for data centre designers, facilities management, etc
g. Contract and account people to keep track of all the various licenses, leases, etc

In addition, most organizations’ data centers are often oversized when they are built and
typically will run at a utilization rate of less that 60%. It is also reckoned that over the four
year life of a server, the combined facility, capital and operational expenses will be up to four
times that the cost of the server itself.

One of the key advantages offered by cloud computing is that you can pay on a consumption
basis e.g. per hour, per gigabyte etc. This has a huge impact on the economics.

When a true comparison is done, using a fully costed model, the decision weighs more
favorably towards cloud computing. And when the other advantages are taken into account
then cloud computing can really stack up as a viable option.

3. Business Agility
 One of the understated advantages of cloud is that it enables an organization o be more agile.

The speed at which new computing capacity can be requisitioned is a vital element of cloud
computing. Adding additional storage, network bandwidth, memory, computing power etc
can be done rapidly and often instantaneously.

Most cloud provides employ infrastructure software that can easily add, move or change an
application with very little, if any, intervention by cloud provider personnel.

The dynamic, elastic nature of cloud computing is what gives it a big advantage over an in
house data centre.

Many internal IT departments have to work through procurement processes just to add
additional capacity. Once the procurement has been authorized it can still take weeks to
acquire and rack new equipment. In many cases the demand for IT services is outstripping the
ability and rack new equipment. In many cases the demand for IT services is outstripping the
ability of the IT department to manage using traditional practices.

Cloud computing allows organization to react more quickly to market conditions and to scale
up and down as needed. New applications can be quickly released with lower up-front costs.

The flexibility offered by cloud computing enables innovative ideas to be rabidly tried and
tested without the need to divert existing IT staff from their daily routine. Increasingly people
won’t want to spend capital on these new ideas. They will want to pay for them operationally.
They may represent a new market, a new technique, a new set of standards, or a new set of
technologies.

If you are starting a new line of business, you can launch with a robust, state-of-the-art
infrastructure without trying up limited capital.

For development projects, organization can provision multiple production-scale systems on

demand in the cloud – saving time and expense over traditional testing scenarios and enable
faster handoff from development to operations. And when the project is finished they can be
turned off again with nothing else to pay.

4. Built-in Disaster Recovery & Backup Sites

 With cloud computing the burden of managing technology is placed on the technology
provider. It is their responsibility to provide built in data protection, fault tolerance, self
healing and disaster recovery.

Typical disaster recovery costs are estimated at twice the cost of the infrastructure. With a
cloud based model, true disaster recovery is estimated to cost little more than one times the
costs, a significant saving. Additionally, because cloud service providers replicate their data,
even the loss of one or two data centers will not result in lost data. Cloud computing
provides a high level redundancy at a price point traditional managed solutions cannot match.
Now every business can put a plan in place to ensure they are able to continue their business
in the face of radical environment changes. Even the cloud computing cynics are agreed on
this.

5. Device & Location Independence

Cloud computing is already enabling greater device independence, greater portability, and
greater opportunities for interconnection and collaboration.

With applications and data located in the cloud it becomes much easier to enable users to
access systems regardless of their location or what device they are using.

Tele workers can be quickly brought online, remote offices can quickly connected, temporary
teams can be easily set u on site, mobile access can easily enabled.

With the growing use of smart phones, notebooks and other hand held devices there is also
an increasing need for data access on the go.

The success of devices such as the iPhone and its App store is also opening up a whole new
world of mobile applications. Connecting these types of applications to data stores will be
significantly easier through cloud.

Location based applications will reach their potential through cloud computing. Many smart
phones are now location aware (using GPS facilities) and we will increasingly see applications
that take advantage of this capability.

Cloud computing will facilitate innovation in many areas. Much of it will be driven by the ease
with which difference devices can connect to cloud-based applications.

6. Bonus Reason: It’s Greener

 As mentioned above, most internal data centers are oversized and do not run at
anything like full capacity. Most servers run significantly below capacity ( real world
estimates of server utilization in data centers range from 5% to 20%) yet they still
consume close to the same amount of power and require the same amount of cooling
as a full capacity machine (granted that Virtualization is changing in some cases)

A typical data centre consumes up to 100 times more power than an equivalent sized office
building. The carbon blueprint of a typical data centre is therefore a significant concern for
many organizations.

In cloud computing environment resources are shared across applications (and even
customers) resulting in greater use of the resources for a similar energy cost.

For corporation spread over different time zones the computing power lying idle at on
geographical location (during off-work hours ) could be harnessed at a location in a different
time zone. This reduces not only the power on consumption but also the amount of physical
hardware required.

With cloud computing virtual offices can be quickly set up. Employees can easily work from
home. Travelling salespeople can have al their data available in any location without needing
to visit the office. There are just some of the other examples of how the carbon footprint can
be reduced.

Any applications or any service running in a cloud computing environment has the property
of self healing. In case of failure of the application, there is always a hot backup of the
application ready to take over without disruption. There are multiple copies of the same
application – each copy updating itself regularly so that at times of failure there is at least one
copy of the application which can take over without even the slightest change on its running
state.

Cloud computing provides a high level of redundancy at a price point traditionally managed
solution cannot match. Every business can put a plan in place to ensure that they are able to
continue their business in the face of radical environment changes. Even the cloud computing
cynics are agreed on this.

Disadvantages of Cloud Computing

1. Data Protection
 Data security is a crucial element that warrants scrutiny. Enterprises are reluctant to buy an
assurance of business data security from vendors. They fear losing data to competition and
the data confidentiality of consumers. In many instances, the actual storage location is not
disclosed, adding onto the security concerns of enterprises. In the existing models, firewalls
across data centers (owned by the enterprises) protect this sensitive information. In the cloud
model, Service providers are responsible for maintaining data security and enterprises would
have to rely on them.
2. Data recovery and availability
All the business applications have Service level agreements that are stringently followed.
Operational teams play a key role in management of service level agreements and runtime
governance of applications. In production environments, operational teams support

a) Appropriate clustering and Fail over

b) Data replication
c) System monitoring (Transactions monitoring, logs monitoring and others)
d) Maintenance (Runtime Governance)
e) Disaster recovery
f) Capacity and performance management

If, any of the above mentioned services is under-served by a cloud provider, the damage &
impact could be service

3. Management Capabilities
Despite there being multiple cloud providers, the management of platform and infrastructure is
still in its infancy. Features like ‘ Auto-scaling’ for example, are a crucial requirement for many
enterprises. There is huge potential to improve on the scalability and load balancing features
provided today.
4. Regulatory and Compliance Restrictions

In some of the European countries, Government regulations do not allow customers’ personnel
information and other sensitive information to be physically located outside the state or
country. In order to meet such requirements, cloud provides need to setup a data center or a
storage site exclusively within the country to comply with regulations. Having such an
infrastructure may not always be feasible and is a big challenge for cloud providers.