Is Cloud Computing an Empty Promise?

A few weeks ago The Wall Street Journal published an article in its technology session titled “Cloud Computing Promises Fall Short”. The authors of the article stated that, while the use of cloud computing is increasing to the point that cloud integration has become a major part of a CIO’s role, the promise of reducing costs through cloud does not always come true. The main reason for this is that some software providers are bundling their services, so that customers end up paying for more than they need. This is true in the cloud hosting world as well, where some providers offer pre-packaged bundles that obligate end customers to commit to more storage, or more services than needed. For example, a company with seasonal storage fluctuation needs may have to buy enough storage for its high season, even if that capacity goes unused most of the year. Also, some cloud hosting providers may require their customers to agree to a multi-year agreement, so that it’s very hard to get out of the agreement without substantial financial loss.

So, if you want to make sure you realize the cost reductions that come with moving your data to the cloud, be sure you ask your provider two questions: 1) When can I get out of this agreement if I’m not satisfied? And 2) Will I need to buy additional capacity now (even if I don’t need it) in order to have enough storage in the future? If these two questions are answered to your satisfaction, you should be able to realize substantial cost savings through cloud storage.