The cloud's money-saving potential questioned [survey]

The cloud's money-saving potential questioned [survey]

Summary: Approximately 45 percent of U.S. small businesses using the cloud reported that the cost reductions were non-existent but there were other operational benefits.

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TOPICS: CXO
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A new poll by IT services integrator CSC suggests that small companies seeking to save large amounts of money on IT infrastructure by embracing cloud services could be in for a surprise.

The research, which surveyed approximately 3,645 IT decision makers from companies of all sizes that HAVE adopted cloud services in some form, found that while a large majority of businesses (82 percent) did save some money by choosing to deploy technology through the cloud model, that savings was pretty small.

That was especially true among small businesses based in the United States. In fact, 45 percent of U.S. small businesses with fewer than 50 employees responding to the poll said they saved no money at all. That compares with 23 percent of U.S. businesses of all sizes. Almost one-third of the businesses saved less than $20,000 by shifting IT infrastructure into the cloud.

Still, that doesn't mean small businesses didn't see benefits. Consider the following:

  • 74 percent of small businesses said no one in their company resisted the move
  • 80 percent of all companies reported process improvements within six months of moving into the cloud
  • 33 percent said their need to accommodate access to computing resources from multiple sorts of devices was a major factor for moving to the cloud

That last point, in particular, is a theme I think you'll hear far more often in coming months. In July 2011, research firm Yankee Group reported that almost half of large companies (48 percent) view mobile technologies as a major motivator of cloud adoption. That was a 92 percent increase over the response to the same question in 2010.

Yes, that is a big company response but in my experience small companies tend to lead when it comes to mobile technology innovation.

Topic: CXO

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  • RE: The cloud's money-saving potential questioned [survey]

    I thinking the most crucial stat here is that 80 percent see process improvements. May not directly tie to immediate cost savings, but it frees up the CIO to become increasingly strategic.
    pfretty@...
  • People are more and more . . .

    turnin to the cloud as a solution for all of their server and computer roles and needs. There is much to say about how new forms of TCO derived cloud computing methods are revolutionizing the cost efficient and energy efficient atmosphere in IT.
    crcgraphix
  • RE: The cloud's money-saving potential questioned [survey]

    Interesting post, Heather. While cost or expense reduction should be a factor in decisions around cloud services, small businesses and enterprises alike should also keep in mind that failing to consider factors beyond cost may result in lost opportunities. Take, for example, a hypothetical situation: a company upgrades its website features and sees a 20% increase in online orders. If that drove revenue up by $1 million, would it be worth the $20K or even $100K cost to make it happen? Your last point about mobile devices driving cloud adoption further supports this idea. It should be as much about what cloud can do for the business in terms of agility, scalability, and responsiveness as it is about benefiting the bottom line.<br><br>Adam Famularo<br>General Manager, Enterprise & Cloud Solutions<br>CA Technologies
    adamfamularo