In spite of the benefits touted by proponents of cloud computing, potential users, including small businesses, aren't convinced the cloud lives up to its hype.
Of more than 1,000 small businesses polled in June by Newtek Business Services, The Small Business Authority, nearly half (48 percent) said they do not believe the cloud will reduce their IT costs, according to a press release. According to a separate release from InformationWeek Analytics, 37 percent of 360 business technology decision-makers have no plans to use public cloud storage. Another 38 percent are still assessing how to proceed.
This could be a blow for the many companies — including Apple, Dell, and Microsoft — that are touting the cloud as a high-tech, low-cost data storage and management solution. In particular, the cloud is being marketed to small businesses as a cost-saving option to in-house IT departments. This week's surveys conclude vendors are failing on two fronts: They aren't educating potential users about the benefits of the cloud, and security concerns aren't being adequately addressed.
“The cloud storage vendors have some major hurdles to leap,” said Lorna Garey, content director of InformationWeek Analytics, in the press release. “Companies are very protective of their data — and rightly so. They need more storage space and services, but they're not going to move their critical business and customer information to a public cloud until they're absolutely sure it's safe and accessible.”
Additional findings from InformationWeek include:
- Only 15% of survey respondents say they currently use public storage services, and only 10% expect to explore adoption within the next two years.
- Security concerns (73%) top the list of reasons companies steer clear of public cloud storage; privacy concerns (54%) rank second, followed by regulatory/legal constraints (36%).
- 59% of survey respondents cite email as the application most responsible for data storage growth; 53% point to retention policies as a factor.
- Backup, at 76%, is the storage function moved most to the public cloud, followed by disaster recovery/business continuity (70%), file archiving (68%) and email archiving (65%); primary data storage is next, at 34%.
- The ability to move data between cloud and on-premises storage is the most important feature (rated 4.4 out of 5) for companies evaluating or using a cloud storage service, followed closely by on-demand access, data encryption and ability to establish/enforce retention policy (all 4.3).
- 76% say they're concerned about storage expenses, yet nearly half don't know how much storage costs, and 8% do not manage their storage resources.
- HP (30%) leads in current or planned use of cloud storage, followed by EMC (26%), Amazon S3 (25%) and IBM (21%)
Is this lukewarm response to the cloud a failure of marketing? I don't think so. Based on the data above, I'd say potential users are better educated than ever. Companies that have built their reputations on data security, such as CitiBank, have been hacked. (See: Hackers Jeopardize High-Tech Reputation.) Game systems — a seemingly innocent pastime — have been targeted by malicious users.
The cloud may be as secure as, or even more secure than, in-house or private IT alternatives, but until vendors can convince users of that, cloud computing is getting a chilly reception.