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XMission's Company Journal

4 Questions to Help you Determine if Cloud Hosting is Right for your SMB

A lot of bootstrap businesses don’t realize that pouring money into on-premise IT infrastructure and staffing right away is often unnecessary—even if they are the next Facebook or Amazon.

Cloud technologies can meet the changing needs of small business owners and make it easier to grow IT infrastructure more organically. In this post, I’ll cover four questions designed to help small business owners determine if they can benefit from moving to the cloud. This post focuses on the value of cloud hosting for web applications, but many of the same arguments apply to other cloud-based services like hosted PBX and email hosting.

1. Do you have the appropriate staff to manage your on-premise services?
First, SMBs who opt for cloud-based web and application hosting can avoid tasking their non-technical staff with managing an on-premise or colocated server. Even those companies with technology staff now have more time to devote to developing applications that help to grow the business and increase profitability, or to focus time and energy on the business’s core competencies.

In the meantime, a host like XMission will manage all of the cloud infrastructure, relieving you of the burden of administration entirely. As a result, you’ll maintain high uptimes. In fact, your service will continue to improve as time goes by as the provider continually upgrades your hardware and software.

In time, your business may opt for total hardware control, making on-premise or colocated servers more cost-effective and attractive; in the interim, take a look at cloud hosting.

2. Do you plan on growing rapidly (or unpredictably) for the foreseeable future?
Second, Business owners can make reasonable investments in cloud technologies now that scale up (and down) as their business matures.

For example, your business may experience a huge burst in traffic during the holiday shopping season. With cloud, you can increase server resources just enough to cover your bursts, and then scale them back down when your traffic returns to normal volumes.

As a result, SMBs using cloud will never have to over-provision annual resources to cover short spikes. Your infrastructure will keep pace with the growth of your business, no matter how unpredictable. When your business growth levels out, you can always choose to move to on-premise or colocated solutions.

3. Do you plan on having a physical office?
Third, cloud services facilitate greater physical flexibility for a growing business. Setup takes minutes with cloud service versus days with on-premise or colocation, without the worry of moving expensive, fragile equipment. With cloud, you can move your office across the nation and avoid any disruptions to your hosting whatsoever. For this reason, cloud also works well as a disaster recovery option.

4. Are you trying to reduce capital expenditure?
Finally, cloud works best for companies who prefer ongoing, fixed expense to upfront capital expense. Purchasing hardware, renewing software licenses, and buying spare parts for servers will result in high upfront costs as well as annual peaks each year. With cloud, your business has little or no upfront cost: all of your expenses come in the form of monthly recurring expenses.

Also worth noting: the cost of Internet connectivity continues to fall, making it more affordable than ever for businesses to access a full cloud suite.

As mentioned before, businesses who subscribe to cloud services will receive the latest technology as soon as it arrives without having to purchase any additional hardware or licenses.

This comes down to how businesses prefer to operate. Over time, the subscription costs of cloud will catch up to on-premise hardware. Some businesses simply prefer to spend money over time rather than purchasing hardware upfront and having a plan for depreciation. Again, businesses who have the capital to make large initial investments in hardware may find that an on-premise or colocated solution makes more sense.

Have you decided to move your SMB to cloud services? What other factors influenced your decision?

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3 thoughts on “4 Questions to Help you Determine if Cloud Hosting is Right for your SMB

  • VoIP Boss says:

    Amazing article, you had a lot of solid points. All companies should take the proper steps before making the switch to a VoIP service.

  • John says:

    What about contracts? Some of these companies tell you their Cloud product is cheap but then you have to commit for a year in advance with no easy (read affordable) way to increase or decrease resource size.

  • Pete Ashdown says:

    John, the XMission Cloud product is month-to-month, and adjustable at will.