Why the pricetag shouldn't be first on SMB cloud checklists

Why the pricetag shouldn't be first on SMB cloud checklists

Summary: Although you're like to cut your IT budget somewhat by putting technology into the cloud, only a quarter of small and midsize companies expect to save more than $500 per year.


If the primary reason that your small or midsize business is considering cloud services is to save oodles of money, your team might want to rethink that position.

More than 40 percent of SMBs believe they'll see "no savings" from their cloud investments on an annual basis, according to a recent survey of close to 1,600 SMB professionals conducted by cloud service provider j2 Global. (That's the company behind services including eFax, online marketing service Campaigner, and virtual telephony options such as eVoice and One Box Communications.)

Another 30 percent of so expect their savings from making a switch to be less than $500 annually.

Or, to look at things another way, only 6 percent of the j2 survey respondents anticipated saving more than $5,000 per year. The remaining 20 percent or so are looking to save between $500 and $5,000.

Mind you, this data (and the question behind it) looks at cost savings strictly from the financial point of view. The question overlooks, entirely, all sorts of questions about intangibles that should play into the investment equation, like:

  • Will this service help me connect with incoming calls more quickly, improving my customer service or making me look more professional than my compeitors?
  • How much can I streamline my business processes by getting rid of fax machines?
  • How quickly can I start selling my products online, without throwing my existing inventory and delivery prices out of whack?
  • Can I view my lastest accounting and financial information from wherever I am?
  • Can I get more accurate about time management and billing?
  • Can I reach my company's prospects on the mobile devices that so many of them have come to prefer? 

The reality is that the cloud makes available many capabilities that aren't readily accessible for smaller companies in the form on on-premises applications.

So while price always needs to be part of the evaluation process, the smartest owners are looking at cloud services as an investment in their company's future, one that is less about dollars saved and more about doors opened.

Topics: SMBs, Cloud

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  • Ah, so!

    Ms. Clancy enumerates some possible advantages of the cloud as an attempt to undermine the real point of the article: very few will actually save money. She should also have included a list of all the disadvantages: Internet down problems, increased bandwidth costs, security issues with having your data/SaaS on a third party system, etc.

    It would seen best to keep the cloud for those few uses at which it does present a benefit and not try dump all your processing into the cloud.

  • ... Good perspective!

    Good article, the value of intangibles is many times underestimated. As is the case of many emerging technologies there will be issues to be fixed or improved but cloud becomes more a benefit than a drawback for SMBs.
    Sawa Cloud