Cloud Computing : What Is It And Why Is It Shaping Our Future?

The Coronavirus Pandemic has shown us what is the true meaning of resilience and adaptability. Remote working has…

The Coronavirus Pandemic has shown us what is the true meaning of resilience and adaptability. Remote working has become the new normal, especially in the professional sector, which begs the question, what exactly made this huge transition to working from home possible?

Digital Transformation. Digital transformation is aiding the industry to move from traditional business processes, culture and customer experiences to modernised approaches and solutions, all with the help of a plethora of technologies. It is the driving force behind Industry 4.0.  Microsoft’s CEO Satya Nadella says that owing to the world’s current situation, they had seen two years’ worth of digital transformation in just two months!

Pioneering this mega transformation is Cloud Computing.

What is Cloud Computing?

In simple terms, cloud computing is the on-demand delivery of computing resources based on a pay-as-you-go consumption model. The primary computing resources available include computing power, data storage, analytics and networking. With this consumption model, customers pay only for the resources they utilise and are usually billed monthly. This ubiquitous technology does away with the need for businesses to invest a large capital expense (CapEx) for the maintenance of physical hardware along with on-premise data centres, which empowers businesses to save costs and focus on their current and future business needs with an enhanced emphasis on innovation and collaboration.

The CEO of Google and Alphabet, Sundar Pichai says that recent estimates indicate that public cloud penetration is likely to increase to 20% by 2023. He estimates that more than 75% of companies plan to accelerate their digital transformations by investing in the cloud.

What is the Cloud and How does it Work?

The cloud is a global network of servers connected through a secure, low-latency network. These servers are spread across different locations around the world and are meant to operate as a single ecosystem. In simple terms, the cloud refers to the applications, software and databases that run on the internet instead of running locally on your physical computer. These servers are placed in data centres across the globe. Data centres that are in close vicinity of each other collectively form a Region. The world is split into Geographies or Geographic Areas, each comprising at least one, potentially multiple regions. Each of these regions function with the help of an extra set of data centres collectively called Availability Zones that introduce an element of redundancy to data storage. These availability zones have their own independent power, cooling and networking, ensuring that data can be recovered in case of failure or outage. The combination of regions and geographies enable businesses to have a global reach with a local presence.

The three main categories of the cloud are public, private and hybrid. The public cloud is owned and operated completely by the third-party cloud service provider. The private cloud is usually owned completely by a company or enterprise and is operated on-premise. Some companies pay cloud providers to host their private cloud. The hybrid cloud is a combination of both the public and private cloud. This type of cloud offers greater flexibility and is most commonly utilised by companies migrating their workloads to the cloud. Emerging categories of the cloud include the multi-cloud and the edge cloud.

Leading Cloud Providers

The cloud computing ecosystem is expanding at a colossal rate, led by the following cloud providers:

Richter, F. (2019). Infographic: Amazon Dominates Public Cloud Market. [online] Statista Infographics. Available at:

Why are Businesses Shifting their Workloads to the Cloud?

So, the question still stands – Why is this technology gaining massive amounts of popularity?

  • Security and Data Protection: With cybersecurity attacks on the rise along with newer and complicated methods of hacking, companies are struggling to combat these threats. The cloud provides sophisticated cyber capabilities and solutions to combat and mitigate security incidents. This is one of the major plus points of deploying workload in the cloud. Cloud providers invest heavily in data security and protection, making the cloud extremely reliable.
  • Cost Optimisation: The pay-as-you-go consumption model helps businesses reduce their capital and operational expenditure, meaning they no longer have to invest up-front in hardware and infrastructure. They are billed only for the resources that they have used. This approach provides major savings and also enables SMEs to have marginal project start-up costs with affordable operational prices.
  • Scalable and elastic: The cloud provides a multitude of services to its customers; however, it also helps them meet their business requirements, while keeping factors like cost and performance in mind. For example, if a website gets increased traffic during particular hours of the day, the company can choose to schedule an increase in compute power (deploy more virtual machines) during that period and scale up while choosing to scale down resources during off-peak hours.
  • Data Modernisation and Transformation: This is one of the primary reasons for cloud migration as surveyed by Deloitte which says that 55% of surveyed IT leaders see data modernisation as a key component of or a reason for cloud migration. The cloud provides a myriad of services for data analytics, data mining and business intelligence which forms a robust and resilient dais for modernisation and transformation.
  • Environment Friendly: Companies like Amazon, Microsoft and Google invest heavily in ensuring that their data centres sustainably serve its users. Data centres are set up to maximise efficiency and mitigate environmental risks.  Businesses are adopting cloud computing use only the resources they need, thereby reducing their carbon footprint.

Companies are increasingly migrating to the cloud by moving their workloads out of in-house data centres. This migration is bringing about a revolutionary change in the trajectories of businesses and helping them to be more agile, more collaborative and more innovative.

The Cloud Computing sector is thriving, and here is what you need to know:

  • HSBC and AWS have reached a long-term strategic cloud agreement where AWS will drive their digital transformation and deliver new and personalised banking services.
  • IBM and EY have struck a multi-year alliance with the major goal of promoting the Red Hat cloud. The two companies wish to utilise IBM’s premier technology consulting services along with EY’s leading strategy and business consulting to provide clients with specialised hybrid cloud functionalities including Red Hat OpenShift, IBM Watson, IBM Blockchain, 5G and edge computing technologies. This global alliance wants to help organisations accelerate their digital transformation.
  • Google and Deutsche Bank have agreed to form a long-term partnership whereby Google will provide cloud computing capabilities to Germany’s Deutsche Bank. The contract is set to last at least ten years, and the Chief Executive Officer Christian Sewing of the German bank confirmed that the partnership could be an important driver of their strategic transformation.
  • BNP Paribas partnered, as the anchor client, with IBM Cloud for Financial Services to further its cloud transformation journey as it migrates its workload to the public cloud.

Cloud Computing is providing services that help introduce high scalability, availability, security and resiliency into organisations. It uses the concept of virtualisation to help reinvent businesses and improve their continuity. Companies no longer have to worry about the intricacies of complicated hardware infrastructure and can solely focus on their business goals, products, applications and so on.

The Harvard Business Review says that “The likely outcomes of the move to cloud include changing how products are designed; closer collaboration between the corporate IT department and other business units, including sales, finance and forecasting; and more customer interaction, even to a point of jointly developing products with their consumers. In particular, new ways of writing and deploying software will encourage new types of faster-acting organizational designs.”  This increased collaboration within organisations will increase their impact and pave the way for innovation. The ability to utilise an array of services surrounding Artificial Intelligence, Machine Learning, Analytics, Internet of Things (IoT), on-demand, is and will open new doors to improvement.

The transition to remote working has proved that cloud computing is enabling businesses to remain agile and power through uncertain times, and is making remote work possible from any corner of the world. Conferencing software and remote virtual desktops are the new normal.  With Digital Transformation endeavours joining hands with Cloud Technology it can be said, without a doubt, that this technology is shaping our future. We will be seeing more and more of it in the days to come.

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