Are small businesses steaming ahead with cloud computing?

Look at just about any IT magazine or IT provider’s website these days and you will find a reference to cloud computing.

In fact, given the prevalence of smart phones, tablets, and ever smaller laptops allowing people to share files and work from home, cafes, trains, and buses (as well as in the office), you’d be forgiven for thinking that the days of the personal computer and office-based server were well and truly over.

But are they? In First Line IT’s 2015 small business survey, we asked just over 300 owners of small and medium-sized businesses in the UK how much they used the cloud and what their biggest concerns were.

This is what we found:

The move to cloud computing by small businesses is slow

Just over a fifth of small businesses now have some or all of their IT in the Cloud, while nearly a third say that they do not intend to move their IT to the Cloud at all.

Some of this is because many small businesses are not actually highly dependent on IT. If they outsource their payroll and other services, and use computers simply to communicate with clients, there is probably little need for them to be on the cutting edge technologically speaking.

Indeed, 45% of our respondents said they are not confident that they understand the implications of moving their IT to the Cloud.

Having said that, many may be using some cloud-based services already – such as email – but just don’t realise it.

The biggest concern about Cloud computing is security

Nearly 80% of respondents are worried about this issue. A third say that the fear of someone stealing their data is what is holding them back from moving to the Cloud.

Not that the Cloud is inherently more insecure than any other form of IT system. In fact, a cloud-based system is often safer simply because people are worried about the risks and take pains to ensure that security protocols are followed and passwords are strong.

Locating the server in the office, on the other hand, can give people a false sense of security. People forget that it is quite possible to hack into an office-based server, even more so if all members of staff are using the same password to log in.

The second biggest concern is costs

This is interesting because you’d think that paying a relatively small monthly fee has got to seem cheaper than the several thousand pounds it costs to buy your own server. Why would this be a concern?

First Line Managing Director Barrie Giles believes that people are finding it difficult to change the way they think about the costs of IT. “In the ‘old days’, you’d buy a server as a one-off capital expenditure and it would be yours: a piece of equipment that you can see and touch. Ongoing monthly costs would seem to be negligible, although in reality you would have to allow for maintenance, repair, and (eventually) an upgrade.

A monthly fee for a cloud service could therefore appear rather expensive, and, if you’ll forgive the pun, nebulous. However, it is important to remember that, when you subscribe to a cloud service, you are passing the risk of failure and the cost of maintenance to the service provider. The hassle and expense of upgrades are also built into the cost.”

Barrie also believes that the fact the many cloud-based services are free to personal users adds to the confusion. “The cost of cloud services often comes as a surprise to business customers, because they have been thinking of them as free or very low cost products. So they are then not sure if they are going to get value for money, and if they are going to be able to keep control of the costs.”

If people are worried about the costs of a cloud computing service, Barrie recommends comparing the total lifetime cost of a server over three years (including the initial purchase price, maintenance, support, and replacement) with three years’ worth of a cloud service monthly subscription.

He also advises making sure that they are signing up for a fixed price service. “Don’t fall into the trap of signing up for an apparently low monthly fee, only to find that there are usage costs on top which can only too easily spiral out of control,” he says.

There is confusion about differences between personal and business use

There is quite a lot of personal usage of Cloud services going on, with half of respondents saying they use file storage services such as Dropbox at home, and 67% with Cloud-based email such as Gmail and Yahoo. Music and movie streaming services are also popular.

But every single type of service is used less frequently for business, even including email, which is used by just under half of respondents.

Why the discrepancy? Quite often, people simply haven’t thought about it. Personal computing seems to be thought of quite separately from business computing – do none of those 80% who are worried about security in their business computing also worry about their personal security?

In fact, 10% of survey respondents admitted that they didn’t realise that the services they used at home were actually Cloud services.

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