The SaaS model that began a few years ago has now evolved into the “Cloud’ computing model being utilized today. Improvements were made to enhance performance and strengthen security. It is a great option for many organizations because it provides:

• Lower maintenance and support costs than premise based alternatives
• Lower entry point than a licensed purchase
• Fast Deployment
• Reduced challenges associated with upgrades, updates, and security patches
• The ability for remote employees to stay connected
• Reduce workload on already busy IT departments
• Highly customizable user settings
• Lower risk with the ability to easily change vendors if desired

Pushing information in the cloud improves collaboration; business partners, employees and customers all benefit from the ease and availability that Cloud computing delivers. Anyone with access to the Internet can now engage in operations through these web based services.

Another key benefit of computing in the Cloud is the cost savings. Businesses today are cash strapped and are looking to reduce costs without compromising services. The financial benefits of Cloud computing are huge. The Yankee Group estimates that Cloud computing brings cost reductions of 50% or more for IT spending. Typically IT savings demands high up front costs, with savings being realized over time. Cloud computing brings almost instants savings, since there are no large, front end costs around implementation.

Types of Clouds:

Cloud computing offers organizations improved options that were not available with SaaS. Cloud models include:

• Private/Internal Clouds -emulate cloud computing on private networks capitalizing on data security, corporate governance, and reliability concerns. Users “still have to buy, build, and manage them” and as such do not benefit from lower up-front capital costs and less hands-on management.
• Hybrid Clouds – consist of multiple internal and/or external providers; an organization provides and manages some resources in-house and has others provided externally.
• Community Clouds – several organizations have similar requirements and seek to share infrastructure so as to realize some of the benefits of cloud computing.
• Public Clouds – a shared environment where service provider makes resources, such as applications and storage, available to the general public over the Internet. Public clouds may have hundreds or even thousands of businesses running in isolated containers within the same physical environment.

With the advances is security and delivery, Cloud computing is proving to be an excellent tool to improve business services while reducing costs. Author Nicholas Carr, argues that the cloud computing paradigm shift is similar to the displacement of electricity generators by electricity grids early in the 20th century. At first there was fear about pooling services with other businesses, but security measures were put in place and costs were greatly reduced by sharing infrastructure.