28 Mar
2016

Savings in the Cloud: How the Cloud Cuts Costs

Local IT infrastructure and the employees needed for maintenance, troubleshooting and general repair are a costly investment. However, the advancement of cloud technology has made localized infrastructure obsolete. While some businesses are skeptical, others have embraced cloud computing and reduced their operating costs in the following areas:

 

Hardware

Localized IT infrastructure is an expensive investment. On top of the initial costs of the hardware, most companies don’t use the majority of their hardware, which wastes space and money. A lot of IT infrastructure is more complex than most businesses need, so they end up paying for capabilities and functionalities they’ll never use.

Alternatively, cloud computing services utilize the hardware they have because multiple companies, businesses, firms and individuals use different aspects of their hardware. Cloud service companies pack huge amounts of hardware into secure data centers, so when a company pays for their service, they are technically renting the hardware the cloud provider owns. Cloud providers make the initial investments in hardware and IT support, so businesses have more time to complete other tasks and focus on the products and services they specialize in.

 

Capital

In addition to most companies not needing all the functions of local hardware, many cannot afford the upfront costs of purchasing the local servers. Even though they may recoup the costs over time, the initial investment may be too much for startups and small businesses to pay. However, cloud computing enables businesses to forego this equipment and let specialized cloud companies invest in it instead. By not having to come up with the capital when starting their organization, businesses can put that money into production, marketing, advertising or other areas that may need it more.

 

Power

Businesses are not turning the cloud on and off like they would with their computers or overhead lights to save energy. One of the byproducts of the cloud is that it uses less energy than localized servers because it uses more efficient hardware. Since cloud service providers run hardware at its maximum capacity, they pass the savings onto businesses who subscribe to their services. As a bonus to cutting down on the cost of the power bill, the cloud is a greener option for the environment.

 

Labor

Any company that uses localized servers should have a dedicated IT department that can troubleshoot and support the business’ employees in-house. However, many cloud services provide full IT support, which eliminates the need for in-house IT employees. Outsourcing IT support can cut costs for businesses using servers without cloud support, but this is not the only affordable option. Many cloud services can provide IT support for their servers as well as support for internal IT departments. This enables businesses to grow their company and maximize their profits, rather than wasting time, energy and resources on IT maintenance.

 

Environment

Although the environment is a less tangible type of savings, it can make a big different for organizations and their customers. People want to work with and buy from environmentally friendly companies, and corporate responsibility is becoming more popular. In addition to public perception, cloud computing reduces the amount of energy used and the amount of carbon dioxide emitted. Cloud data centers are doing more to decrease their carbon footprint, which means their business partners are reducing their environmental impact as well.

 

 

 

 

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