makingforstoringinformation

Dec 1 2009 by Sue Scott, Evening Gazette

Upwardly mobile Teesside firms are capitalising on a sky-high technological revolution. JEZ DAVISON reports.

IMAGINE taking all the information stored on your PC or laptop and catapulting it into an open space that’s larger than all five continents put together.

A mind-boggling idea, perhaps, but it’s happening every day with increasing regularity.

Put simply, cloud computing is revolutionising the way information is stored, shared and absorbed.

Vast computing resources reside somewhere out there in the ether - the cloud - and users can connect to and use them as often as they need.

Business bosses are finally cottoning on to the idea that they can save money by accessing sophisticated, reliable, cheap - or even free - software solutions over the internet.

And on Teesside, forward-thinking IT chiefs are reaping the benefits of a rapidly emerging market.

Cloud-based work generates more than 60% of revenues at £1m turnover Stokesley IT firm MC Ware.

MD Jonathan Wheatley says: “It’s a massive part of our business. The benefit (of cloud computing) for customers is that you only pay for what you use.”

He estimates that by using the cloud, a typical small business could save £10,000-15,000 on PC/server installation costs and thousands more on operating the machines.

And there are environmental and aesthetic benefits, too. With no need for a noisy, hulking IT server, a company can significantly reduce its carbon footprint and free up more office space.

It’s no wonder IT heavyweights such as Amazon, IBM, Oracle and Google are muscling into the cloud.

Google and IBM have invested millions in large data centres to enable users to access content over the internet as and when required.

And Microsoft, having tried to hold on to its near-monopoly of PC office programmes and operating systems by encouraging users to purchase innovative new versions, is now following suit.

The software giant will make basic versions of its Office 2010 suite free of charge next year - meaning users won’t have to purchase a licence before running the software on their PCs.

The suite will make basic versions of Word, Excel and PowerPoint available online for free and include a powerful new application, SharePoint, that will allow users to work on a single document wherever they are in the world.

It’s a mind-bending concept but, after a slow start, figures suggest that businesses are buying into it.

According to analyst Gartner, worldwide cloud services revenues are on track to pass $56.3bn (£39.3bn) this year - a 21.3% rise on 2008 - while it predicts the market will mushroom into a $150bn (£90.8bn) giant by 2013.

And the wheels of commerce are driving the revolution.

Cloud-based business services including advertising, e-commerce, human resources and payments processing made up 83% of the market last year.

Gartner claims the technology could revolutionise the media industry, with cloud-based advertising already generating $28bn last year.

But advertisers won’t be the only beneficiaries, according to Neil Stephenson.

The CEO of fast-growing Stockton technology firm Onyx claims that cloud computing can help create a “dynamic” IT infrastructure for businesses across just about any sector.

“Businesses are moving from a cap-ex (capital expenditure) model to a revenue model, which gives much more flexibility,” he says.

“It’s not easy to upscale quickly with a cap-ex model. A revenue model allows you to grow and shrink your IT infrastructure.”

With a cap-ex-model, rapid expansion in staff numbers could require a hefty investment in software licenses and hardware such as PCs, laptops and extra servers. But a revenue-based alternative offered by the cloud allows companies to invest in software as and when needed.

While the technology has brought fresh possibilities for businesses looking to scale down costs and risk in recession, it has been met with resistance from bosses concerned about losing control of personal data that is catapulted into a highly interpersonal stratosphere.

Others don’t even realise the technology exists.

Teesside University is championing the cloud’s potential with soon-to-be-released software that will allow companies to improve their marketing and customer research by tapping into this virtual environment.

Professor Mike Lockyer, professor of computing at the university, says cloud computing can help small firms discover vital information about their target audience and generally give them more choice and flexibility.

But he warned that the technology did not come without challenges.

“I’m not extremely sure I want Google or Microsoft storing data about me in the cloud.”

“Also, if your telephone line or modem goes down, you can’t get access to your data.”

But Jonathan Wheatley says the latter issue is already being met head-on through the clustering of data centres.

“If one centre goes down, the user can still access data from another centre,” he says. “That’s excellent for business continuity.”

But the cloud isn’t a virtual Utopia.

In October users of T-Mobile’s Sidekick smartphone lost valuable data, including contact numbers and photos, when remote servers operated by Microsoft-owned subsidiary, Danger, went down.

Which just goes to show that not every cloud has a silver lining.