Cloud Computing Economics - There Is No Free Service

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Real Value in Cloud Computing

The cloud is real

I have officially come full circle from my position last summer regarding the reality of Cloud Clomputing in which I presented a skeptical view of Cloud's potential to actually materialize.  It is now quite apparent to me and increasingly to my clients and readers, that Cloud is real and it is here to stay.  I was reminded of this reality just this morning.  As I read through various news stories online, I came across the following fascinating story from Fortune Small Business - Cloud Computing: Supercomputers for Hire.

The article clearly articulates a real life value proposition for TC3 Health.  When faced with a massive increase in demand for a new service that TC3 was offering, they turned to Amazon's EC2 service to handle the overflow of demand.  Thus the scaling, failover, and reliability concerns were all neatly outsourced to a 3rd party and TC3 only had to pay for usage (not installation and on-going maintenance).  The results speak for themselves.

"Now TC3 Health spends a mere $600 a month on EC2 fees, including customer support. That's $29,400 a month less than what it would have spent on physical servers. The company's revenue rose to $20 million last year, which might never have happened had TC3 not reached into the cloud."

Maybe the clouds really are lined with silver...or there is a pot of gold at the end of the rainbow...or whatever silly metaphor you'd like to use.  The bottom line - Cloud Computing works.

Read the original blog entry...

More Stories By Kyle Gabhart

Kyle Gabhart is a subject matter expert specializing in strategic planning and tactical delivery of enterprise technology solutions, blending EA, BPM, SOA, Cloud Computing, and other emerging technologies. Kyle currently serves as a director for Web Age Solutions, a premier provider of technology education and mentoring. Since 2001 he has contributed extensively to the IT community as an author, speaker, consultant, and open source contributor.