All of the technology and business people I regularly talk to keep telling me cloud computing. But what is it, what is the impact on business and what are the economic and physical benefits?

Cloud means Internet. The computing is done on the Internet – in place of the software you use running on your computer, it’s hosted on the Internet on a server located in a data centre commonly staffed by people who are proficient in managing technology. This type of “cloud” software is commonly known as “on demand” or Software as a Service (SaaS).

Some shining examples of well established Software as a Service are:

Web based CRM Software (Customer Relationship Management) – Salesforce.com pricing around $9 per user/month.
Small business management and accounting software (small business ERP) – Salesorder.com pricing $45 per user/month.
Medium sized business ERP software – NetSuite pricing around $99 per user/month.

There are 3 substantial benefits for every business here:

Time, cost savings and reliability

Businesses no longer require a permanent IT professional to help them identify, bed in and manage the hardware and software infrastructure thus cutting operating costs and time to deploy. The effort of regularly backing up data is taken away as this is almost always an inherent feature of the “cloud” software. Cloud software “operators” almost always have stand by systems that can be turned on in seconds should a catastrophic failure occur.

Easier selection and wider choice

Using a web browser, businesses now have 24/7 access to a big selection of applications they can in the majority of cases immediately evaluate and effectively assess if the software fulfils their needs at no expense. This makes it very easy for innovators in large businesses to get around the standard information technology purchasing processes and easily test and prove their business case.

Superior user experience

The internet provides rapid feedback to application designers and has fuelled substantial progress in user interface design resulting in easier to use software thus reducing learning times and increasing user satisfaction. This of course means faster adoption and higher productivity.