SMB’s find that Cloud Computing significantly reduces cost

Cloud ComputingIt is invariably true that no single business strategy is appropriate for all firms.  When it comes to cloud computing, however, recent data indicates that the vast majority of businesses do find that it lives up to its central promise of reducing IT expenditures by reducing costs associated with on-premises infrastructure.

Last week, Rackspace released a new survey pointing to this conclusion.  The survey involved interviewing more than 1,200 businesses in both the US and UK.  All of the businesses in question had made use of cloud strategies in one form or another.  Remarkably, only the small minority of 17% felt that cloud computing had failed to save them money.  In contrast, nearly four times as many business users – some 66% – reported that cloud computing had indeed allowed them to trim costs associated with IT.  The remainder of respondents offered no opinion on the cost issue.

Rackspace’s Chief Technology Officer, John Engates, summarized the findings of the research, saying: “It used to be debatable whether the cloud was saving money or not, but apparently the businesses we surveyed believe it is saving them money.”

The survey also provided much more detailed information regarding business use of cloud computing and in particular the cost savings that could be garnered by moving applications to the cloud.  For example, nearly 20% of companies queried indicated that IT cost savings had exceeded 25%, while a further 41% reported slashing IT costs between 10% and 25%.

Nor was cost savings the only benefit of cloud computing.  More than half of respondents indicated that using cloud services helped them to implement projects faster, and a similar proportion said that cloud computing had helped them to increase their profits.

A similar survey arranged by Intermap focused on businesses that have yet to make the switch to cloud computing, but who may be considering running applications that run in the cloud.  Optimism is high among such businesses, with 41% anticipating cost savings in their IT departments.

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