To Cloud… or Not to Cloud!

My company dove into the “Cloud” in 2005, before there even was a cloud.

As a Managed Service Provider, I was one of the first in South Florida to embrace its sometimes radical change of cloud-based delivery of applications, data and services.

While you might think as an early adapter, I would be evangelizing the virtues of moving everything to the Internet, it comes as a surprise for some when I preach caution. I get lots of questions from clients about “the cloud,” particularly about what to do and when to move to it. The first thing to recognize about the cloud is that it’s nothing new. Nobody woke up one morning and said “hey, I’ve got a great new idea for hosting data and applications on the Internet!”

An idea around for many years, “The Cloud” is really just a marketing gimmick for the ASP (Application Service Provider) service model, an idea that never really caught-on commercially. Until now, that is.

The idea is to offer customers the option of accessing their data and their applications over the Internet, or some other remote connection technology, instead of having them buy things like Microsoft Word, and Excel, and maintaining them on their local computers.

Sounded like a pretty cool idea but for practical reasons, it never caught on. One reason: the drop in hardware prices (there was not much money to be saved by going with a less-costly ‘thin’ client, as it is called). But the biggest problem was access to the applications and data. The Internet was just not fast or reliable enough for most businesses to trust critical operational functions, like billing, accounting, or production to an offsite service.

One thing in particular has changed all this: cheap bandwidth wherein the cost was mostly just out of reach for most businesses. In the 1990s, if you had deep enough pockets, you could have a T-1, which still remains the gold standard in connectivity. The problem with a T-1 is the cost, which today starts at about $390/month for most offerings. Today, you can find DSL and cable service offerings that are potentially many times faster than a T-1 for a fraction of the price. So what’s the problem? With cheap, highspeed Internet, why not move everything to the cloud?” Well the problem is reliability. Even as I type these words, the power is out in South Miami, and has been for a couple hours. Oh, I still have electricity and air conditioning, thanks to the modern miracle of a stand-by generator.

But what I do NOT have is Internet service, because the provider I use also relies on the local electrical grid, and even though my generator is providing power to the Internet router linked to the service, the service itself is down, and experience tells me it will remain so until FPL gets things back up again.

I can tether my computer through my smart phone, but the bandwidth is only a small fraction of what I am accustomed to, and not enough to do much more than email, realistically speaking. Even things like Facebook are so slow as to be rendered almost unusable. (Imagine trying to run crucial business applications over a tethered smart phone!). That’s only one aspect of a reliability problem. Unless you have ponied-up for T-1 service (whoever your Internet Service Provider is), they’re selling you Internet on what is called a “best effort” basis, i.e., not contractually obligated to provide any minimum level of bandwidth performance— just to make their “best effort” to keep your service up and running. T-1 service is different by providing a “quality of service” base, the promise to deliver a minimum-level of bandwidth at all times. If they fail, you have legal and financial recourse under the contract, a principal reason T-1 is so expensive.

So, circling back to the cloud, what do you need to think about before going all-in on cloud-based services? The first question I ask my clients is how reliant are you on having immediate access to your data? Next is what would the financial impact be of losing access to any particular computer applications used by your business? And if you can’t withstand losing access to data or services for more than a short period of time without serious losses, can you bear the costs of maintaining a reliable high-speed Internet service? Keep in mind that many consultants and provider are not going to answer these questions for you.

Cloud-based services work really well for some businesses, saving and sometimes doing things nearly impossible or really expensive, any other way. Remember: they are not always a panacea, not necessarily good for everyone, and may actually put you in a compromised position.

Gregory T. Conterio, a Managed Service Provider, can be reached at

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