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How Clouds Upgrade Technology Without Capital
Don't let a tepid economy keep you stuck with obsolete equipment and services

By: John Shepler

Here’s a business dilemma. The economy is improving, albeit still slowly, and you have both the opportunity to capture additional business and a need to fend off competitors who are eyeing your share of the market with hungry looks. Unfortunately, you’ve been in survival mode so long that there isn’t much capital left in the savings account. Bankers make funny faces when they look at your loan applications. Is there any hope you can get new technology on-board before things get really desperate?

Rent instead of own
Conventional financing methods may not be working so well these days, but technology has given us other options for upgrading our technical plant. Most interesting is the option to deal with capital limitations by avoiding capital investments completely. How can you do that? Rent instead of own. The technical term for this is hosted solutions.

The website hosting model
When you think of hosting, the first thing that comes to mind is website hosting. This is a huge industry with so much competition that you can host a small site now for just a few dollars a month and get a reseller account so you can provide hosting for other businesses for around $25 a month. For small to medium size businesses, the economic advantage of running your own web servers has all but vaporized. Yet, it wasn’t that long ago that downloading the Apache software and running your own server made a lot of sense for even home based tech businesses.

Scale it up
Now let’s scale this idea up for larger businesses. You’re probably thinking that you absolutely have to support your in-house data center because those racks and racks full of servers have such a special configuration that you can’t possibly buy the same service from someone else.

Clouds are common now
Have you been watching what’s happening in the world of cloud computing? Sure, the largest installations are targeted to the very high end of the market. But that cutting edge technology is now a few years old. Cloud computing isn’t something all that esoteric anymore. Just like web servers matured from a unique and proprietary product over the course of a couple of decades, cloud computing is rapidly moving up the learning curve. More and more companies are offering cloud services on a competing basis.

For businesses of all sizes
This is great news for businesses of all sizes. It’s relatively easy to go out now and rent your Infrastructure as a Service (IAAS) by the hour. Why do that? For one thing, there’s no need for a capital investment. You won’t own the equipment and you won’t have to maintain it. It won’t even be installed on your premises. For another, you have an instantly scalable, nearly unlimited set of resources at your command. No need to get capital requisitions to buy equipment in anticipation of a need six months down the road. You only need to request and pay for the capacity you need right now. That’s processing, storage and bandwidth. If and when you need more, add it incrementally. If demand slacks, scale down your cloud resources.

Works great for SaaS
The same discussion applies to Software as a Service (SaaS). Use collaboration or CRM cloud services and pay by the seat by the month. You can add resources easily as you hire new employees. No need to have a lot of facilities on hand in anticipation.

Hosting also works for telephone services
Telecommunications now also fits the rent rather than buy model. Hosted PBX, also called Hosted VoIP, telephone systems leave the telephone sets on your desks but move the switching system and its telco trunk lines to the cloud. You get a rich feature set and the ability to integrate mobile smartphones as well as traditional desk sets. No need to worry about maintenance and dealing with the telephone companies. The service provider takes care of that. Plus, you have no investment. Some plans even include new IP business phones as part of your monthly fee.

If it has anything to do with computing or communications, you now have the opportunity to avoidraising capital and simply pay as you go for the technology resources you need to conduct your business. Interested? See what’s available from Cloud Computing Carriers right now... before you write another capital plan.

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