Cloud Computing, Its Types, and Benefits

Author- | Posted- | Updated: July 3, 2020 |

Today, thousands of websites and apps run using cloud computing tools. The term was introduced around 2000 and since then the use of cloud computing resources and tools has grown a lot. Particularly, in recent years as the use of online apps and resources has grown, the use of cloud computing by small and large enterprises as well as individuals has also grown. There are numerous websites and apps including streaming services like Netflix that use cloud computing to deliver their services worldwide.

cloud computing, types and benefits.

What is Cloud Computing?

AWS (Amazon Web Services) defines Cloud Computing as “the on-demand delivery of IT resources over the Internet with pay-as-you-go pricing. Instead of buying, owning, and maintaining physical data centers and servers, you can access technology services, such as computing power, storage, and databases, on an as-needed basis from a cloud provider like Amazon Web Services (AWS)”.

Cloud computing eliminates the need to own the entire infrastructure. Companies can just rent these applications. Moreover, every company cannot run the data centers required for running these cloud-based services. Cloud computing offers several more benefits including higher efficiency, scalability as well as low operating expenses. Whether it is the email providers like Gmail or social media or streaming apps, they all rely on cloud computing for making their services available around the globe. The power of cloud computing can also be understood from the fact that it powers large apps like Facebook and Netflix. 

Who uses Cloud Computing services?

Worldwide a large number of organizations and individuals use cloud computing services to run their websites and apps. Moreover, the use of cloud computing is not limited just to the Information technology industry but in other industries too, as companies continue to invest heavily in digitalization, they are making use of cloud computing to deliver their services to their customers online. Organizations of every type, size, and industry use cloud computing to power apps and for many other purposes.

Apart from running customer-facing web applications, they use it for data backup, disaster recovery, email, virtual desktops, software development, and testing as well as big data analytics. Even in the finance and healthcare sector, cloud computing technology is being used heavily to serve customers. Healthcare companies are using cloud computing to offer more personalized treatment options to patients in developed nations. In the finance sector too, companies are using cloud computing technology to detect and prevent fraud in real-time.

Apart from these, the gaming industry utilizes cloud computing technology heavily. The game makers use cloud computing technologies heavily to make their games available to millions of gamers around the world. PUBG, one of the most popular games runs on Microsoft Azure. Amazon also bought Twitch to provide a boost to AWS. Netflix also makes use of AWS resources and capabilities heavily to make its services available to viewers around the world.

Now, that the use of online resources has grown manifold due to the Coronavirus pandemic as people had to practice physical distancing and digital technology came as a savior for small and large businesses worldwide, the use of cloud computing resources in several more industries can also be expected to grow a lot. The customers of Microsoft Azure are from several industries including education, healthcare, retail, manufacturing, pharmaceuticals, banks, and capital markets as well as several more. 

Types of Cloud Computing Services:

There are three main models of cloud computing and each one of them represents a different part of the cloud computing stack. Here are three main cloud computing models:

Infrastructure as a service (IaaS):

Infrastructure as a Service or IaaS contains the basic building blocks of Cloud technology. IaaS providers generally provide the customers access to computers, data storage space as well as networking features. Organizations have their own platforms and applications on the IaaS provider’s infrastructure. Apart from that, the customers enjoy the highest level of flexibility as well as management control over their IT resources. Moreover, it is very similar to the existing IT resources that developers and IT departments inside most companies are familiar with. Some of the leading features of IaaS are as follows:

  • Users do not have to purchase the hardware outright but they can pay for IaaS on demand.
  • Resources can be scaled depending on the processing and storage needs of the individual or organization.
  • Organizations can save the costs that they would otherwise spend on buying and managing their own hardware.
  • There is no single point of failure since the data is on the cloud.  
  • By enabling the virtualization of other tasks, IaaS helps you free your time to focus on other tasks.

Platform as a service (PaaS):

Platforms as a Service or PaaS eliminate the need for organizations to manage the underlying infrastructure (generally hardware and operating systems). It allows organizations to focus on the deployment and management of their applications instead of spending time on the maintenance of hardware and operating systems. Since the organizations do not need to worry about resource procurement, capacity planning, software maintenance, patching or any other heavy tasks related to running a web application.

  • PaaS offers a platform with tools for testing, developing and hosting applications in the same environment.
  • Organizations do not have to worry about the underlying infrastructure and they can focus solely on development.
  • It’s the provider who manages security, OS, server software, and backups.
  • Even if teams are working remotely, it is possible to collaborate without difficulty.

Software as a Service (SaaS): 

SaaS is a cloud computing product that offers users access to a vendor’s cloud-based software. In most cases, Software as a Service implies end-user applications. The application is located on a remote cloud network and the user can access it through the web or an API without the need to install the application on their local devices. Users do not have to worry about how the service is managed or how the underlying infrastructure is maintained. They just have to use the service or the particular piece of software. For example, the email service you use to send and receive emails without having to worry about the underlying infrastructure like the OS and the servers is an example of Software as a Service.

  • SaaS vendors offer their users software and applications through a subscription model.
  • The SaaS provider installs, upgrades and manages software and the users just have to use the software.
  • Equipment failure will not cause a loss of data since the data is stored in the clouds.
  • Resources can be scaled based on growing needs.
  • The application can be accessed from anywhere in the world using almost any internet-enabled device.

Benefits of Cloud Computing:

Cloud computing offers several benefits from cost efficiency to speed, scale, and flexibility. Here are the leading benefits of cloud computing.

Agility:

One of the leading benefits of cloud computing is the agility it offers. With cloud computing,  you have access to a large range of technologies that enable you to create nearly anything you have in mind, allowing you to innovate faster. It is easy to spin up resources as you need them. For example, whether it is infrastructure services like compute, storage and database or IoT, machine learning, data lake, analytics, and much more. Deploying technology services takes just a few minutes and transforming an idea into a workable solution is now easier and faster than ever before with the help of the cloud. APart front hat, you can test new ideas much faster than ever before and carry out new experiments with customer experience and transform your business in not days but a few minutes or hours.

Flexibility:

While you are focusing on the core concerns that affect your business, you would not have much time to focus on the technological resources and their management. So, you can transfer all these liabilities to an external organization that will take care of it all for you. Moreover, if you are trying to do it on your own, you will need to commit too many resources to computing, database, etc. This may take your attention off the other things that affect your bottom line more directly. In such a case, your focus will grow divided and your business will be affected adversely.

Cloud technology comes to your help in this scenario. Compared to hosting on a  local server, cloud technology offers you a lot more freedom and flexibility. Moreover, when you need some extra resources, your service provider can add extra bandwidth easily. However, when hosting on a local server, you will need to make complex updates to your local system to scale resources. By outsourcing these needs you have higher freedom and flexibility. This can improve your organization’s efficiency a lot. A large number of businesses around the world believe that the ability to meet the demands of business faster is one of the main reasons that companies should move to the cloud. 

Cost savings:

A large number of organizations are concerned about the price tag when deciding whether to switch to the cloud or not. However, when trying to understand the advantages and disadvantages of the cloud, companies must consider other factors as well as the ROI. Once you have moved to the cloud, your organization has easy access to data and information which saves you a lot of time and money. Many times business managers are concerned and confused about the features believing that they will end up paying for the features that they do not need or want.  However, most of the cloud computing services available in the market are pay as you go which means you pay as you use and not for more. The pay as you go system also implies that you pay only for the storage that you use and not for extra space. Overall, these factors result in lower costs and expenses as well as higher returns on the investment you make.

Easy to deploy:

You can easily expand your business globally in a few minutes using the cloud service. Using cloud computing technology, you can easily expand to new geographic regions and deploy globally in just minutes. Large cloud providers like AWS or Microsoft Azure or Google Cloud have infrastructure located all over the world and in just a  few clicks you can deploy your services globally in multiple locations. Moreover, if your users are in Asia, you would want to have your application located in their close proximity. Using the global infrastructure of these providers you can achieve this easily. Apart from reducing latency, it improves user experience a lot. 

Security:

Many times organizations and business managers are concerned about security when it comes to taking their business to the clouds. After all, how will the client know if the data and files he has stored online are being fully protected? If a user can access his data remotely, what can stop a cybercriminal from accessing and stealing the same data? Well, that’s a real concern.

However, the security system of a cloud provider is generally a lot stronger than the one you use inhouse. Moreover, when having an in-house system, you have to divide your efforts between the security of your user data as well as a myriad of other concerns. A large number of businesses also face the possibility of internal data theft. A very large number of such cases are perpetrated by the employees. On the other hand, cloud providers have more robust security systems.  Their security systems are many times more efficient than conventional in-house security systems. To protect your user data from internal theft, it is generally more secure to keep it offsite. The main reason behind the higher security cloud-based systems is the level of encryption used by cloud providers. The data being transmitted over networks and stored in databases is encrypted which protects it from easy access by cybercriminals. Moreover, users can set extra security features as per their needs when using cloud-based services. Another important factor is that disaster recovery does not take a lot of time when using cloud computing services.   

Mobility:

Another important advantage of cloud computing is the extra mobility it offers. Through cloud computing, you have mobile access to your data which means you access corporate data using smartphones. A large number of CEOs monitor business performance in real-time using cloud-based monitoring systems on their smartphones. Considering that a very large number of people use smartphones globally, it is easy to keep everyone in the loop and ensure that no one is left out. At this time, when the coronavirus pandemic has forced a large number of organizations to ask their people to work remotely, staff can easily follow up with the progress or collaborate from their homes using cloud-based systems. Your sales staff who travel frequently or your remote employees who are working from their homes will find it easy and convenient to access this data online. So, cloud computing can also help you grow your workers’ satisfaction and help them achieve a better work-life balance. 

Sustainability:

Cloud-based systems are also highly sustainable. Globally, a large number of organizations are concerned about their environmental impact including the direct and indirect impact. Cloud-based services do not just help you grow your business efficiency, reduce the use of physical products and hardware as well as cut down on paper waste. All these factors make your business more sustainable. Many large businesses also involve their stakeholders like suppliers in these initiatives to reduce the overall impact of their entire system.

 Hosting your application on the clouds in this way proves to be really a lot more sustainable and allows you to reduce your carbon footprint heavily. So, sustainability is an additional advantage of Cloud computing, and businesses that are genuinely concerned about their environmental impact are more likely to switch to the use of cloud-based services.

Competitive edge:

The popularity of cloud computing solutions has not grown without a reason. There is a lot of evidence pointing to the fact that businesses that have adopted cloud computing solutions are experiencing faster business and gaining faster against their competitors. So, instead of making their data and services accessible from anywhere in the world using the global cloud infrastructure of large service providers, the businesses that store their data locally are at a clear disadvantage. 

Cloud computing offers you a clear edge. You have everything that you need at your fingertips. However, even with the cloud computing solutions, there is a little learning involved so you can design your own applications and use the same resources more efficiently to offer a better customer experience. If you are quicker than your competitors to adopt cloud computing solutions, it will keep you ahead of them along the learning curve and your rivals will be left behind trying to catch up with you. A large number of organizations around the world believe that cloud computing gives them a significant competitive edge.

Increased Collaboration:

The need for and the importance of online collaboration has grown a lot with the pandemic. A larger number of teams are working remotely and the use of online collaboration tools has also grown a lot. These collaboration tools are mainly cloud-based software that makes it easier for teams to chat and collaborate and stay connected. You can manage an entire remote working team and help your employees collaborate without difficulty. 

In the current situation, collaboration is a top priority for businesses around the world. After all, you cannot operate your business as you did normally before Covid-19. A large number of businesses have transitioned to the online model and started using remote working software to manage their teams and help them perform during this period. Cloud computing makes collaboration very simple and your team members can easily share and access information using cloud computing solutions. Some cloud-based services even offer spaces like social media to help your employees connect with each other. This increases employee interest as well as the employee engagement rate. While collaboration is also possible without a cloud-based solution, it is generally not as effective. 

Quality Control:

Cloud computing helps businesses manage their performance and keep things on track through continuous monitoring. Otherwise, poor work quality and inconsistent reporting can prove highly detrimental to the success of a business. These things do not just lead to wastage of effort and resources but time also. Cloud-based systems help you avoid errors. With cloud-based systems, you can store all your data in one place and in a single format. When everyone gets to access the same data and in one place you can easily maintain consistency in data as well as avoid errors and keep a clear record of any update or revision. If you try to manage information in silos, it will lead to employees saving different versions of the document and that will result in higher confusion and dilution of data. 

A few final words about cloud computing

Cloud computing has changed the world a lot and there are thousands of services that we access for cheap online and using our internet-enabled services. From Netflix to social media as well as several other software and professional or business resources, people can access a large web of services without any difficulty. The importance of cloud computing solutions has especially been highlighted during the times of a crisis. During the pandemic, a larger number of businesses have resorted to the use of cloud computing solutions to stay connected with their employees and customers. The use of collaboration tools has also grown a lot and while the use of remote working has grown, it could not have been possible without the use of cloud computing solutions. Cloud computing enables hundreds of things that we use on a daily basis including the email. Moreover, it has proved to be a savior for both small and large businesses that rely solely on cloud computing solutions to make their services available to users worldwide. However, the best thing is that the cloud computing solutions have continued to grow cheaper with time and it does not prove very expensive to take your user data and store in the clouds. Your data is secured in the clouds and you and your employees can access and share information from anywhere. Cloud computing has also enabled faster growth for a very large number of businesses worldwide by helping them achieve a competitive edge that could not have been otherwise possible.

Abhijeet Pratap

Abhijeet has been blogging on educational topics and business research since 2016. He graduated with a Hons. in English literature from BRABU and an MBA from the Asia-Pacific Institute of Management, New Delhi. He likes to blog and share his knowledge and research in business management, marketing, literature and other areas with his readers.