Cloud computing has opportunities for cost reduction – but beware of criminals {writer: Leon Alberts}

For many organisations looking to cut costs, changes in technology offer an excellent opportunity to reduce information technology (IT) spend while delivering greater value to the business. One such change is “cloud computing”, which Gartner, Inc. defines as “a style of computing where scalable and elastic IT capabilities are provided as a service to multiple customers using Internet technologies.”

This is the opinion expressed in a recent article by Alan Low, chief executive officer of Purchasing Index, a company that provides benchmarking and analysis services via the “cloud”.

Historically, organisations tended to buy servers which they networked together to provide knowledge and information to their staff. This ranged from managing transactions i.e. the procure-to-pay cycle for purchases, to providing management information.

Inevitably, there has to be a certain amount of excess capacity to handle peak requirements such as running reports at month- or year-end, among others.

To the extent that organisations can now buy services via cloud computing, businesses presently have significant opportunities to cut costs, as they will no longer require the following:

• Hardware – PCs, servers, etc. to run the relevant cloud-based functions;

• Maintenance costs for these servers;

• People – technical support to ensure this hardware runs optimally and is available as and when required; and

• Software upgrades and licence fees, as some functionality may now reside in the cloud.

Some IT personnel within the organisation could to be redeployed to provide more added value services such as data analysis.

Gartner predicts there will be a 25% reduction in IT labour hours by 2015. “Self-service and automated provisioning associated with cloud delivery means productivity levels for service providers will increase.”

There are other longer term benefits, as traditional data centres within businesses face the following challenges:

• Ballooning labour costs as experienced and skilled personnel become scarcer in the South African marketplace;

• Savings in energy costs, both to run the infrastructure and to keep it cool. Energy costs in South Africa are expected to continue increasing beyond the current series of annual 25% increases in electricity tariffs;

• Increasing demands of users due to the proliferation of data sources and the need for their integration;

• Increasing complexities associated with trying to get data sources to synchronise with data warehouses, and managing data silos that are resident in different business units; and

• Managing exponential increases in business data as it becomes richer from both internal and external sources.

Cloud services can often provide a significant reduction in current IT costs while adding tremendous business value to management and staff who are tasked with driving business improvements and cost savings. Many of the services can be financed through operational expenditure rather than motivating for a share of the capital budget.

Finally, cloud computing can result in a very attractive return on investment, and a payback period measured in months rather than years.

Criminals out there

While the continued innovation and new developments in the information and communication technology (ICT) sector constantly offer new opportunities to organisations, businesses and governments, criminal elements are never far behind.

As pointed out by Fred Mitchell, Symantec division manager at Drive Control Corporation, in a recent article: “Cybercrime has become a more profitable industry than the drug trade and, as a result, the malicious software now developed is no longer about simply causing a nuisance, but has evolved into a sophisticated scheme aimed at stealing sensitive information in order to make a profit. Methods such as spear phishing are aimed at obtaining this information through a highly targeted attack that uses personal details and information to make the attacks seem more genuine, and this method is gaining popularity.

“Other trends to look out for include the growing use of shortened URL links in spam e-mails to disguise the nature of the link, and the use of languages other than English in malicious mails, depending on region.”

Besides cloud computing, there has been a proliferation of the types of devices being used by people to access networks. Mitchell says the rule of thumb is that information must always be protected, no matter the device on which this information sits.

With the dramatic increase in mobility and the growing number of users who now have multiple devices, this has become a more complicated process.

Protecting all network-accessing devices from malicious software is becoming a necessity, but software is not enough – a comprehensive backup strategy needs to be in place to cover all the devices used to store and access information.

The reality is that the more portable a device, the more likely it is to get lost or stolen; and with people now using these highly portable devices to work from as well as their PCs, multiple versions of documents exist across multiple platforms, which need to be backed up. These mobile devices need to be synced to PCs and the network to ensure the correct information is backed up.

Protecting information is a twofold process that has become even more important with the growth of mobility and constant connectivity. A combination of the latest protection software with a comprehensive, all-encompassing backup strategy is the best way to ensure organisations and individuals do not fall foul of the ever increasing number of threats in cyberspace.