Cloud: Are you weary of this buzzword yet? It's bandied about a great deal in the tech industry. Cloud computing has definitely had a significant impact on the way we compute at home and in business. The cloud is often heralded as the perfect means to deliver applications, infrastructure, and other resources to businesses. With no on-premise tech to manage or additional hardware to buy, the cloud is cited as a low cost saviour for small business tech needs. For more on the technical side of cloud computing and what it entails, take a look at our beginner's guide to cloud computing.
Despite all this, small businesses are still hesitant about moving business processes to the cloud. The move to the cloud, while continuing to accelerate, is not as frantic in the small business sector as the hype might have us believe. Here are three big myths about small business cloud adoption.
Myth 1: SMBs are flocking to the cloud
One problem is that many small business owners are unclear about just what the cloud is. While the hype would make one think small businesses are moving to cloud computing in droves, a 2013 small business survey conducted by Brother found that 46 per cent of small businesses understood the concept of the cloud "somewhat," while 27 per cent didn't understand it well or at all. Clearly, cloud vendors and the tech media are falling short in conveying exactly what cloud computing is.
The same study revealed 42 per cent of small business owners state that they aren't using the cloud for their business.
Of course, the argument can be made that while some of those surveyed may not understand the cloud, that doesn't mean they aren't using the cloud. After all, a vast array of services fall under the cloud computing umbrella. If they're using hosted email such as Gmail, an online office suite like Microsoft Office 365, or storage and syncing solutions like Dropbox, then they're using the cloud.
Of course, unwitting use of the cloud doesn't mean appropriate or safe use of the cloud. Any IT manager reading this will shudder at the possible compliance and basic security issues unregulated cloud use can present. More on that in a moment…
Myth 2: SMBs see cloud storage as a perfect fit
Conventional thinking dictates that the most widespread use of cloud computing for small business is for data storage and backup. It's a no-brainer: Storing data online is cheaper and easier than managing local storage for a small business. However, small businesses are hesitant about online storage.
Drobo, the network attached storage vendor, did some great research into small business attitudes about cloud storage. The verdict is that these business owners are leery. There is one significant challenge for small business and storage, according to Drobo's study, and the findings make sense.
The biggest barrier preventing many small businesses from utilising cloud storage is bandwidth limitation. Those of us in large urban areas may be ignorant of the fact that, for many in more rural areas, high speed bandwidth just isn't there yet. Drobo's study discovered that 46 per cent of smaller businesses in the US don't find public cloud storage a perfect fit for backup solutions primarily because of limited bandwidth and quality of network issues for site-to-site disaster recovery solutions. Instead, many SMBs are seeking hybrid onsite and offsite backup and storage solutions.
Myth 3: Security fears are the biggest obstacle to SMB cloud adoption
Your teenager may not have many privacy and security concerns when it comes to the cloud, but the perception is that for businesses, security is a major cloud roadblock. The perception is particularly pervasive when it comes to small business.
However, there are some interesting studies showing that security is often not the major factor for small business cloud hesitancy. One interesting study from research group Techaisle shows that, in fact, desire to maintain ownership of data was a primary factor for small-to-mid-sized American businesses eschewing cloud services. In some places, small businesses are subject to regulations that makes it difficult for them to keep data in third-party datacentres. Minnesota’s Attorney General sued one healthcare provider for lax security with thousands of patients' digital health records.
This isn't to say that security isn't a concern, but it may not be the one that keeps small businesses from going to the cloud. Economic benefit often trumps security concerns for small businesses that do use cloud services. Lawrence M. Walsh, CEO of the 2112 Group, a research and strategic services firm based in New York said: "Small businesses – particularly startups with growth ambitions – are adopting cloud services at an accelerated rate. The cost-benefit of cloud is in their favour.
Nevertheless, many still harbour security concerns as they are relinquishing their data and mission-critical assets to an outside provider or providers. They worry about data accessibility, integrity, confidentiality and portability." However, Walsh points out: "In the end, security concerns lose to the economic benefits of cloud services."
Of course, cloud service providers are doing everything they can to entice the SMB market, a huge potential customer base. Software tech giants like Microsoft are shifting from boxed on-premise products to online services such as Office 365 and Azure for their customers, and are homing in not only on the enterprise market, but small business as well.
Vendors are developing a plethora of app stores that will make it easy for small business owners to pick and choose the apps they need to get business done. One interesting app store model comes from San Mateo-based company SaaS Markets. This company offers businesses its MarketMaker Express Platform, a Software-as-a-Service commerce app store customised for a particular client’s needs.
Ferdi Roberts, Founder and CEO of SaaS Markets, saw a unique opportunity to tailor app stores for customers. "I think what we determined very quickly is there is a change in the way software companies are choosing to license their products," he said. SaaS Markets recently launched a tailor-made app store for a New Jersey-based IT services company, Powersolution.com.
"SaaS Markets picks up where others leave off in providing a branded and complete delivery platform to its partners," says David Dadian, CEO of Powersolution.com. "Powersolution.com instantly recognised the value a store would provide to our clients and beyond."
Cloud companies both large and small are coming up with innovative services and strategies to get SMBs on board with cloud computing. However, while cloud adoption is ever-increasing in all segments of business, small business owners are cautious and contemplative, as they should be, about cloud adoption. There's not quite the frenzy to go full-on cloud, as market hype would lead us to believe, and small businesses will continue to hesitate until the cloud challenges – both real and perceived – are addressed.