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2010 "the year of the cloud"

07 Jan 2010

More than 70% of SMEs plan to switch to cloud computing within the next five years, according to a study carried out by British ISP Easynet Connect.

This compares to 47% at the end of 2008 – an increase of nearly two-thirds.

However, most remain unprepared for cloud computing, in terms of strategy and security.

“2010 is the year of the cloud for SMEs, with the research highlighting a much more ambitious rollout within five years,” the study says. “Half of SMEs plan to be using cloud software by the end of 2010 (with 13% already using the cloud today and 37% planning to do so within 12 months).”

The sales, media and marketing industry is the most cloud-savvy, with 30% already using cloud software and 40% planning to do so within two years.

Larger SMEs (those with 50 employees and upwards) are the keenest to adopt cloud computing, with 66% already using the cloud or planning to do so within 12 months. This is at odds with the general consensus that it is the smallest companies, with the least IT legacy, that are leading the charge to the cloud.

More than 50% of businesses questioned said they believed cloud computing would save them money, while around 43% believed it would help staff to work from home. In the 2008 survey, this figure was 35% in both cases.

Negative perceptions of the cloud are still very low, with only 13% of SMEs claiming it isn’t secure enough and 9% saying it isn’t reliable.

More businesses are implementing formal strategies for adopting the cloud; 29% now compared to 13% previously. Marginally more businesses are improving their internet connection as they adopt the cloud (19% in 2009 vs. 13% in 2008), but this is still very low.

Alarmingly, the vast majority of businesses (85%) aren’t putting more stringent security measures in place and 71% lack a formal strategy for using cloud computing.

“The next challenge is for SMEs to ensure they have a formal strategy in place for adopting the cloud,” commented Easynet’s managing director, Chris Stening.

“While today’s installations may not be entirely critical to the business, it is only a matter of time before the core business functions, which typically run on off-the-shelf spreadsheets and databases today, are migrated to cloud platforms. The success of Salesforce (a cloud based CRM) is one such example of how business-critical functions can so readily migrate to the cloud.

“With more core applications moving this way, SMEs need to ensure they cover all the bases – can their existing internet connection cope with the additional bandwidth demands? Is their ISP reliable enough? Do they have a backup line if their main one fails? How secure are the cloud services they’re using?

“Preparation is key for any business undertaking such a radical change to their operations. You wouldn’t, for example, relocate your offices to another country without first checking out the local tax regimes, regulatory frameworks, workforce quality etc. The same is true for businesses migrating to the cloud.”

The survey interviewed 255 IT decision-makers in SMEs (defined as organisations with between 10 and 250 employees), split equally between male and female respondents across a range of age groups. The research was conducted and compiled in December 2009.

Read the full results at tinyurl.com/yl234k7