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While you hear the term frequently and see the images of puffy whiteness illustrating the concept, you may still be wondering, “What is the cloud?”

Despite being a standard technology solution for many years, it’s still a good time to understand the basics of what the cloud is and how it can benefit your business.

What Is the Cloud?

Simply put, the cloud is a global network of servers accessed via the Internet. Many people incorrectly assume the cloud is a non-physical computing solution, when in fact the cloud consists of physical locations that house hardware, software, applications and services. Cloud computing delivers on-demand computing services on a pay-as-you-go basis.

There are three basic types of cloud computing services:

  • Software as a Service (SaaS). These services let users access software applications from an internet-connected device. Perhaps the most common is Microsoft Office 365, which provides access to the popular Office application suite.
  • Platform as a Service (PaaS). These web-based solutions are offered by third-party providers and deliver hardware and software, often for application development.
  • Infrastructure as a Service (IaaS). In this type of cloud, the cloud provider hosts infrastructure that would typically be stored in an on-premises data center, such as servers, networking hardware and storage.

What is the cloud

How Prevalent Is the Cloud?

The cloud is becoming increasingly common in business today. According to IDG’s 2018 Cloud Computing Survey:

  • Nine out of 10 companies expect to have part of their applications or infrastructure in the cloud by 2019, with the rest expected by 2021
  • 89 percent use SaaS in their IT environment
  • The average cloud spend for small- and medium-sized businesses (less than 1,000 employees) has doubled since 2016 to $889,000
  • Businesses are moving to the cloud to address the following:
    • Improved IT services deliver speed (71 percent)
    • Flexibility to react to changing market conditions (63 percent)
    • Business continuity (58 percent)
    • Improved customer support (57 percent)

Why Is the Cloud So Beneficial to Businesses?

Using the cloud has multiple advantages for businesses of all types. With the cloud, multiple users can leverage the infrastructure and services available in the shared space. At the same time, businesses can control and customize what is used and how it’s used.

Here are some of the major advantages of cloud computing:

  • Cost. Cloud services come at a predictable monthly rate, based on what’s selected in terms of capacity and services. Businesses will not need to purchase as much hardware and software. Companies also save on the costs of housing the hardware in on-premises data centers, maintaining those data centers and the hardware, and the power and cooling demands.
  • Convenience. The cloud enables your employees to access data and applications from nearly any device that’s connected to the Internet from anywhere. Files, work materials and applications are readily available securely from anywhere in the world.
  • Scalability. As businesses grow, so too does the need for additional storage capacity, processing capability or users. Cloud solutions allow for rapid scaling without the need to purchase, configure and maintain additional servers or to manage and staff large on-premises data centers. If the business has seasonal fluctuations, demand can contract similarly.
  • Security. Cloud service providers offer enterprise-level digital and physical security, ensuring your data is protected and monitored constantly. If suspicious activity is detected or unwanted threats are discovered, they can be identified, isolated and resolved before any serious damage occurs.
  • Recoverability. Natural disasters and cyber attacks can cripple a business. That’s why cloud solutions provide an added safety net for your data, applications and systems. Automated data backups, housed out of the region, ensure that if an incident does occur, your business can be back up and running with minimal if any downtime.
  • Collaboration. Cloud solutions allow for better collaboration, especially among teams in different locations. Collaborative tools like Google Drive, Salesforce and Basecamp allow users to create, edit, comment on, share and save documents in shared workspaces that can be accessed at the same.
  • Testing. Cloud computing allows companies to test concepts and move faster on special projects without having to wait for cumbersome procurement procedures or incur large up-front costs. New services, products and tools can be tested in the cloud and deployed faster via the cloud’s scalability features.

The cloud is likely to continue to be a source of innovation, efficiency and productivity for businesses large and small.