Finding Your Safety Net in the Cloud

It's clear that cloud computing is now much more than a fad or a buzzword; it's a business reality that is backed up by cold, hard cash. In fact, in a recent study released by IDC, the research firm found that public IT cloud services spending will reach $98 billion in 2016, with a compound annual growth rate five times the growth of the IT industry overall. This is especially true of emerging markets and early-stage companies. According to the IDC study, emerging markets will grow their cloud services spending by 44% through 2016, and will account for almost 30% of net-new public IT cloud services spending overall. Early-stage companies (defined as being in business for less than five years), plan to increase their spending on public cloud by 24% over the next few years.

These stats aren't just limited to those purchasing cloud-related services. The numbers are also staggering for vendors who offer cloud-related services. According to IDC, cloud-oriented partners—defined as having more than 50% of their revenue related to the cloud—grew 2.4 times faster than their counterparts (defined as organizations having less than 50% of their revenue related to the cloud).

Why? Companies are constantly looking for ways to do more, to collaborate better, to create more product, to continue pushing the revenue needle forward—all the while enabling an increasingly global workforce. Not just for saving costs on what is traditionally capital expenditures on hardware, but more so for business agility. The business landscape has never been more competitive, and every enterprise is looking for an edge. Judging by the numbers, many believe utilizing the cloud to manage enterprise systems and content such as Microsoft SharePoint, will help pave their way to victory. Benefits of cloud include:

• Manageability—Let hosting providers manage upgrades and maintenance, so you can focus your IT efforts on driving business productivity;
• Lower total cost of ownership—You only pay for service that you actually use, eliminating the need for physical servers and other hardware that might otherwise sit idle to support future growth or peak load times;
• Service and infrastructure management—Using software as a service (SaaS) means you don't need to manage the underlying infrastructure of on-premises software. It also removes the need for you to update and monitor software-this is all handled through the hosting provider;
• Scalability—Use only what you need. No more, no less. When business spikes, you can add virtual infrastructure as needed. Alternatively, as utilization decreases, so will the cost, unlike traditional on-premises capacity planning resulting in expensive infrastructure largely sitting idle;
• Binding service level agreements (SLAs)—SLAs for on-premises environments can get expensive and resource intensive, especially when you're shooting for 99.9%. Most cloud offerings target that percentage of uptime, which equates to approximately 8.76 hours of downtime in one year. Many organizations with limited IT resources and budget would be unable to meet these same service levels;
• Infrastructure disaster recovery—Most cloud offerings have disaster recovery plans, such as a geo-redundant data center architecture, with a stand-by replica data center to continue service if the primary data center goes down. Again, all maintained by the provider and not by you;
• Firewalls and access—Worried about compliance and privacy standards? So are cloud providers, as many of their solutions are typically hosted on infrastructure that is accessible over the Internet, and are already built to meet stringent regulatory standards; and
• Sustainability—Facing pressure to go green and reduce your carbon footprint? Cloud infrastructure consolidates server resources and optimizes power usage in order to help you in your pursuit of sustainability.

Specifically with regard to SharePoint, deploying the platform on-premises means increased investment in infrastructure and keeping up with changes in technology. Your IT administrators can quickly become overwhelmed with maintaining the necessary services to properly manage the growth, including hardware, software updates, disaster recovery strategies and storage costs.

After reading that list, the draw to cloud computing becomes clear, and many may think that it's a no-brainer to follow the charge popularly led by Microsoft chief executive officer Steve Ballmer several years ago when he proclaimed that his company was "all in" on cloud computing, urging the software industry and enterprises worldwide to follow suit. Before you push all your chips to the center of your boardroom's table, let's take a look at some reasons why companies might be hesitant to pull its information away from existing on-premises investments.

For many organizations, especially those subject to regulatory requirements, the move to the cloud is not without risk. Enterprises have significant concerns about storing business data outside the walls of their enterprises, due to non-employee IT administrators possessing a high level of access and control over information; available technology options to secure and manage user access and authentication; or even intentional or accidental actions of employees or contractors. Furthermore, compliance officers are concerned with the risk created by enterprise social features, which potentially expose sensitive personally identifiable information (PII), classified information or otherwise non-compliant content. Even having to depend on an Internet service provider's reliability for access to your most critical data is enough for some organizations to think twice about the cloud—especially for those that are charged with supporting global operations where this might not always be a given.

The Cloud Buffet

Bearing in mind the potential benefits and challenges, the next logical question is how? If you think about it, the cloud is in some ways like the 21st century version of the buffet: There is a plethora of choices, whether it's going all-in with SaaS, platform as a service (PaaS), or infrastructure as a service (IaaS), or utilizing a hybrid model mixing cloud workloads and on-premises investments. Options to help reduce the cost of managing SharePoint, for instance, for enterprise collaboration and social environments, include hosting your enterprise content and systems entirely, incorporating cloud storage solutions into storage architecture, or a hybrid deployment including on-premises and online environments. Much like a buffet, the choice really depends upon your preferences and your ability to unify management for efficient enterprise content management—no matter what option you determine is best suited to your needs.

What is the verdict thus far? Increasingly, it's looking at a mix of both cloud computing and on-premises investments—more commonly known as a hybrid model. IDC finds that large customers, especially, will maintain a significant amount of their IT facilities and staff at their sites, and by 2020, about 80% of the world's 2,000 largest companies will still have more than 50% of their IT onsite. They will also require new capabilities (automated provisioning, hybrid management capability, autonomous virtual machine management capability, etc.) as they look to build enterprise private clouds, which combine their onsite resources with hosted private cloud resources and SaaS/public cloud services, in a true hybrid fashion.

We find that many enterprises are opting to offload select content or workloads to the cloud, and keep their most regulated content on premises. Likewise, for organizations that have existing SharePoint deployments with extensive customizations and business solutions but want to begin taking advantage of SharePoint 2013 social, e-discovery, publishing features and the new app model, a hybrid approach can provide the best of both worlds. While taking a hybrid approach can lead to some management complexity, it can also provide for a more secure extranet collaboration scenario, as external users no longer have to be accounted for in on-premises directories and security models. Having that experience on premises is also key for many enterprises looking into the cloud. IDC found that 74% of customers surveyed also want their trusted cloud service provider to be able to offer comparable on-premises expertise.

So what's your move? Essentially, as stated earlier, you have three main options when it comes to utilizing the cloud:

1. Hybrid on-premises and cloud infrastructure;
2. Hybrid IaaS deployment; and
3. All-in, cloud-only deployment.