Cloud Computing

Cloud Computing: Why Everyone’s Looking Skyward

Get primed on cloud computing, including a summary of the different services it offers, public vs. private architectures, and when to consider “serverless” cloud.

Nearly all enterprise marketers have their head in the cloud these days — and for good reason.

Cloud computing has not only disrupted computer-dependent business processes as we know them, it is now an expected approach to traditional and next-gen IT. Businesses look to cloud technology to handle everything from applications to data storage to platform hosting to data analysis. You would be hard-pressed to find a modern company of any size not using some form of cloud-based computing.

The concept basically boils down to renting space on third-party servers to house data, software, and applications that users can access on demand, in “the cloud.” Before cloud computing providers began offering use of their servers, companies typically had on-premise servers that they had to build, configure, and maintain on-site. The average company quickly found its capabilities outpaced by cloud service providers.

Here at Annalect, we learned long ago the hard lessons of keeping up with modern marketing processes using on-premise servers. With the mass amounts of data we were constantly bringing in and crunching for analysis, the benefits and trade-offs of cloud computing were too great to ignore. What once required investment in “server farms” and other hardware and software technology stored and operated on-site can now be outsourced to gain efficiencies and highly scalable capabilities.

On an industry level, cloud computing is on a tearaway growth streak with no signs of slowing down. Experts predict that the market for cloud-hosted services will reach $162 billion by 2020, and the largest cloud computing company by market share posted massive 43% year-over-year growth. Adoption of cloud computing services by businesses of all stripes has driven this growth.

So, still not sure what exactly cloud computing is and why so many businesses have migrated to these services? And how has cloud computing evolved over the years to become the engine of enterprise technology innovations, creating a more complex yet convenient landscape than ever? Read on to find out.

Main Types of Cloud Computing Service Models

The first thing to understand about the cloud is how versatile it can be. When a company asks to rent server space (or computing power) from a cloud-hosting service provider, they can:

•  Host versions of their software that are always updated and don’t require installation to use. End users can conveniently log onto the internet to access the program. This is known as Software as a Service (SaaS).

•  Run functions like the capture, storage, and analysis of marketing audience data. Because multiple applications and processes are being run from off-site cloud servers, some refer to this type of function as a Platform as a Service (PaaS).

•  Store data off-site, saving money compared to buying hard drives while offering safety with automated backups and redundancy. Many cloud providers can also help maintain network security for companies through firewalls and active monitoring. This is known by some as Infrastructure as a Service (IaaS) since it replaces the need for the hardware itself.

Benefits and Considerations of Cloud-Based Services

Benefits of using any of the above cloud-based services — or a combination of them — include:

1. Lower startup costs: Purchasing servers and then configuring networks and applications to run requires significant time, labor, and money. Monthly fees for cloud services represent a fraction of these costs, letting marketers more quickly recoup their investment in marketing or data-based software, systems, and programs.

2. No maintenance concerns: Outsourcing computing to the cloud puts the responsibilities of server stability, operations, maintenance, and updates on the service provider. Cloud users also don’t have to worry about replacing obsolete technology.

3. Less capital expenditures and assets: From an accounting perspective, using cloud services lets companies reduce their owned assets and the risks associated with ownership.

4. Agility to bring new ideas and programs to life: With lower startup costs and instantly scalable delivery of computer-based services, a company can kick off a new marketing project or program in minimal time.

5. Options for adding on features instantly that would be too expensive to purchase outright or develop in-house: Functions like AI-driven natural language processing or big data analytics can be implemented on-demand with far less latency, risk, and cost.

6. Added threat security and data security (for some): Many cloud service providers include standard or optional cloud-based security solutions and data backups for their clients.

Considerations to using cloud-based services include:

1. Security and information protection: Any conversation involving data should take security and privacy into high consideration, particularly when managing sensitive data. The Cloud Security Alliance (CSA) suggests you learn how cloud providers integrate security throughout their service, from access control techniques and authentication to activity monitoring policies. However, the customer takes all ownership and responsibility for security “in” the cloud. As such, companies should have skilled expertise when configuring and managing these services, especially since it’s easy to get started without formal IT help from the cloud service provider. As Werner Vogels, CTO of Amazon, emphasized in his AWS re:Invent conference keynote on November 30th, “There are no longer any excuses for not encrypting all data, both in transit and at rest.”

2. No ownership of service performance: Most cloud services contracts stipulate minimum performance levels, but mishaps do still happen. When they do, the company is at the mercy of their service provider’s ability to fix them.

3. Internet-dependent functionality: If your internet doesn’t work, you can’t access cloud services, which can include data and vital applications for many marketers.

4. Possible dependency/ownership concerns over data and processes: As marketers depend more on cloud services for hosting and providing vital computing functions, there is a looming risk that data and operations can be “held hostage” during contract negotiations. That said, competition among cloud service providers largely negates this threat.

5. Increasing complexity of cloud-based systems: Modern technology, in general, has become harder for the average person to wrap their head around, and using multiple cloud-based processes can make integrating it all difficult or too overwhelming.

Public vs. Private vs. Hybrid Cloud Architectures

Another major distinction to make between cloud-based services is how the services, hardware, and network are set up.

The first type of cloud-based services to emerge at scale were referred to as the public cloud. A public cloud architecture means you are essentially renting server space in a shared cloud environment that is identical to everyone else’s and uses many of the same base systems.

Think about it as booking a hotel room for people to work in. All of your data and processes are kept private behind “closed doors,” but you use the same lobby and elevators to access the room as everyone else. Also, each hotel room is functionally identical except for a few add-ons and upgrades.

The private cloud refers to a single environment created for and dedicated to a specific company or a specific purpose. Servers and the way the system is networked are built to specifications and a proprietary architecture. Think of it like building a private condo or sizeable vacation home, everything is built on your property and for your own purposes.

A hybrid cloud, on the other hand, is just as it sounds — a combination of a private on-premise cloud and a public cloud. A hybrid architecture allows the use of both public and private components to operate effectively and independently of one another but can communicate via an encrypted connection. The types of integrations and use cases vary and are widely dependent on an organization’s specific needs, but in some instances, this can provide the best of both worlds.

On-Demand Solutions: When to Go “Serverless”

New technologies now allow you to access the processing power of the cloud on an as-needed basis — as opposed to renting dedicated always-on servers.

This model of cloud services is called “serverless,” since it uses mostly virtualized machines and processes to run. In other words, it doesn’t matter how much equipment you use, it only matters how much data and computing resources you use. You can purchase the computing horsepower you need just for specific jobs, and that can be extremely beneficial in certain instances. Going back to the building metaphors, this is like renting a workspace or a conference room for just as long as you need it.

Even our internal teams have come to rely on these scalable, on-demand capabilities. For one project, our Managing Director of Technology, Eric Whitney, requested the use of 150 virtual process instances to scrape data from an online video platform for around three days. He was able to turn on and off the process using simple clicks on a web page. The total cost: $150.

“The trend is toward a point where major tech infrastructure and capabilities can be deployed as easily as a new phone app, and businesses who aren’t moving towards these ecosystems are going to find themselves left way behind,” explains Whitney. “It makes as much sense to build and manage your own data center at this point as it would to create your own power plant or manufacture your own planes because employees travel sometimes.”

To Find the Future of Marketing, Watch the Skies

The capabilities of cloud computing and all the diverse ways it can serve business needs have made it too good of an opportunity for most marketers to pass up. Emerging on-demand capabilities allow these marketers to consume processing power on an as-needed basis, making goals easier to fulfill with no startup costs associated.

At the same time, the proliferating environment for cloud technologies has made integrating it all confusing to many marketers. In a March survey, only 3% of marketers claimed that their systems and technologies were “totally connected” and that all their “data, metrics and insights seamlessly transfer across all technology.” A quarter says that “there is little to no connection between systems.”

Marketers must therefore increasingly lean on the knowledge and consulting advice of cloud technology subject matter experts to navigate the complex marketplace, integrate their systems and data, and accomplish their goals with minimal friction.

With the current maturity level of cloud computing, the key question isn’t if this should be your direction moving forward, but instead, it’s what you plan to do with it. Stay tuned for some exciting Annalect news that answers that exact question.

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