Cloud computing vendors maintain data away from the facilities of their customers. This is compelling because it enables companies to focus on what they do best and leave the technology to outside specialists.
Many service providers offer metered service – much like a utility. This model is attractive to smaller organizations that are looking to remain flexible in a challenging economic climate and contain costs.
Price alone is only one component of the total cost of ownership (TCO).
Larger organizations should consider factors such as:
- Adoption costs
- Regulatory implications
- Data security risks and how a change might jeopardize trade secrets
As a result, many larger organizations are more reluctant to move to the cloud. During the decision-making process, information systems management professionals should also consider how the technology will serve the needs of the organization and its management.
After making the decision to proceed with cloud computing, it is critical that a client negotiate an enforceable contract with the service provider, anticipating things like technology failure and even bankruptcy.
The agreement should define who owns, accesses and controls data, where it is actually housed and how often it is backed-up. This can mitigate risks inherent to cloud computing.
Source credit: Stephen Turner, Known-Quantity.com and Holy Family University