Outlook Cloudy

Bill Bennett offers a no-nonsense guide to cloud computing and its benefits for business.

At first sight, cloud computing looks a lot like desktop computing. Cloud applications do the same jobs as their desktop counterparts. The difference is that with the cloud, the processing all takes place on remote servers connected to the desktop via the Internet.
This changes everything. Apart from anything else, it makes using computers cheaper and means technology can get out of the way of doing business.
We call it ‘cloud computing’ because when it first arrived it was explained using diagrams with images of clouds showing data floating somewhere in the Internet – it doesn’t matter exactly where. Cloud data and applications can be used with almost any device anywhere there’s a net connection – which these days means most places.

You’re probably already using the cloud
Cloud computing is relatively recent, remote processing is not. It has been around since before the Internet or the first PCs. Some of the most popular cloud applications are more than a decade old. Hotmail, a web-based email service now owned by Microsoft, was introduced in 1996. Google’s Gmail is now eight years old.
Both are classic cloud applications. You get to them using a web browser and there’s no need to save data locally: everything is stored in a cloud.
Hotmail and Gmail paved the way for cloud computing – they neatly demonstrate its advantages. You don’t have to sit at your desk to read all your old emails. You can access them from someone else’s machine – from work or from home. More importantly, cloud email works with a smartphone or tablet.

No fuss computing
The email applications illustrate other distinctive features of cloud computing. You can usually use them without installing extra software. On a PC it’s simply a matter of opening a web page in your browser. There may be a small amount of configuration to get cloud mail on a phone or tablet, but it takes seconds.
In other words they require almost no administration. You don’t need a separate server – that’s a saving. You don’t need IT specialists to keep things humming – or, if you’re like many business owners, it means your technology doesn’t distract you from everyday business.
When Google or Microsoft upgrade their mail applications, there’s nothing to download, it’s done remotely for you – you may not notice both are regularly updated with small fixes and minor changes.
One negative is you don’t have much choice. If the companies change their applications, you’ll get the new software whether you are ready or not – although they sometimes allow you to temporarily revert to the older version.

Then there was Google Docs
Around a decade ago Google realised it needed to be more than a web search company. It couldn’t compete head-on with Microsoft for desktop applications – Office dominated. Instead, Google acquired a web-based word processor which became Google Docs. It also purchased the technology behind Google Spreadsheets.
Google Docs and Spreadsheets are the heart of the web company’s software-as-a-service office suite. The applications are simple with fewer features than desktop tools. However, they have one major advantage: users can share documents and collaborate on them.
At times it can feel strange seeing a remote colleague edit one part of a document while you are working elsewhere on the same page.
Whjile Google Docs is the best known document-sharing software, a popular alternative is Zoho (www.zoho.com). Both are free to individuals, although there are paid-for options. Google offers a business version of its software along with basic web-hosting and a custom domain name in the shape of Google Apps. This costs US$5 per person per month or US$50 a year.

Microsoft Office 365
Office remains Microsoft’s mainstream software suite, a new version is due to appear later this year or early in 2013. It will be timed to coincide with the next release of the Windows operating system. However, the company is already making waves with its Office 365, which offers similar applications in a software-as-a-service form along with hosted versions of Microsoft’s server products. There are two versions, one for companies with less than 25 users and one for larger firms.
Office 365 is priced competitively compared to the desktop version of Office and with Google Apps. Small companies pay NZ$9.25 per user per month for the basic service – that’s half as much again as Google Apps. To sweeten the pot, Microsoft includes more applications and communications features such as instant messaging and video conferencing.
Microsoft New Zealand product marketing manager Rachel Turney says Office 365 includes web versions of the company’s popular desktop applications. It also works with existing desktop versions of Microsoft Office. If that doesn’t suit, there’s an option to subscribe to Microsoft Office Professional Plus with Office 365 – a combined subscription to Office 365 and Professional Plus is NZ$38.25 a month.   
Microsoft’s pitch to New Zealand businesses points out substantial savings can be made from reducing or eliminating the need for local servers. There’s less need to worry about making data backups and Microsoft looks after security. Because the hard work is done in the cloud, it means there’s less pressure to spend on desktop hardware.
Turney quotes a satisfied Office 365 customer who tells her “we didn’t get into business to manage servers”. Turney says customers using the service generally start because they need just one part of the functionality, then quickly move to using other components. She says the internal instant messaging and video conferencing features are big draw cards.
An often overlooked part of the Office 365 deal is that the subscriptions come complete with Microsoft support – that’s online help for low-end customers and 24/7 phone support for those buying the full package. At the time of writing, IBM is preparing a similar software-as-a-service suite of office applications, so the market could soon become competitive.   

Beyond Office
There are few business applications which can’t be found on the cloud these days: Zoho offers 27 individual applications. One of the better-known business applications is New Zealand’s own Xero accounting programme.
Xero competes directly with well-known accounting packages like MYOB or QuickBooks. It has the same advantages as other cloud programs: instant access from anywhere and no need to worry about servers, upgrades or backups. Best of all you can check your numbers from a mobile phone. Prices start at NZ$29 a month for a micro-business, but most companies will need at least the NZ$49 a month option. That’s a per-company price, not per user.
Being in the cloud means Xero can automatically take bank feeds – there’s no need to download or manipulate files once you’ve signed a form authorising the feed. It learns how you classify suppliers and attributes purchases to categories, all you need to do is OK the choices.

Cloud issues
It’s still early days for cloud computing, there’s something of question mark over certain aspects of security and it’s not always clear you’ll be able to get quick access to your own data should you choose to part company with a cloud service provider.
You’ll need to research these issues for yourself before committing to any service, but for most businesses, the cost and time savings that come from switching to the cloud are too significant to ignore. There’s a lot to be said for being able to leave the computing to the experts and get on with running the business.
Bill Bennett is an Auckland-based freelance IT writer. Email [email protected]