January 26, 2011
A lot of SMBs are apparently deciding that they don't, and firms like Cbeyond are banking on that.The demand for cloud services among SMBs is growing by 50 percent a year, indicating that SMBs are discovering they won't need servers if they can get to the cloud. These numbers carry more weight than they might as they are cited by a firm that serves the SMB cloud services market: Cbeyond in Atlanta.
Brooks Robinson, head of Cbeyond's cloud services division, said he has seen figures indicating the SMB global cloud services market will grow 50 percent yearly from 2008 to 2011, and is expected to reach about $60 billion next year. Cbeyond's experience bears this out, , he added, and the firm (which went public in 2005) now has 55,000 users and revenue of about $400 million. Cbyond's cloud differs from services like Amazon's Elastic Compute Cloud (EC2) cloud (which charges 12 cents an hour for Windows users) by being simpler, says Robinson. He says that EC2 and services like it are too elastic and offer too many options. Vendors like Cbeyond offer simplified services with predictable billing, he said. Their service starts at $99 per month for one gigabyte of RAM and 30 gigabytes of storage. That's pretty basic hardware these days, but someone else is handling the installation, upgrading, patching, anti-virus software, and daily backups, Robinson noted. You also get a licensed Microsoft operating system. (Cheaper services are based on license-free Linux.) And basic hardware is probably sufficient for most applications that SMBs normally run on servers. Robinson said they tend to be industry-specific, such as inventory for manufacturing companies, or billing for medical offices, while CRM and accounting is widely popular. The application software is typically purchased on-line and then downloaded through the Internet to the user's virtual server on the cloud, he added. Of course, people will still want on-premises servers, and there will always be SMB server users, since there are SMB tasks (like video editing) that will not be practical on the cloud. But in this day and age they should be seen as an option, not a necessity.
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