It’s easy to find companies and people to wax lyrical about the benefits of cloud computing, but it’s not often that anyone highlights the disadvantages. It’s true that cloud has become an industry and ecosystem in its own right and has demonstrated its value time and again in user situations, so much so that industry analysts IDC considers it to be one of four key ‘pillars’ driving modern computing today, along with social media, big data and mobility (c.f. Housing Technology’s feature article on the subject back in May 2014).
But is there ever an argument against moving an organisation to the cloud? Housing providers must consider all the options and ultimately find the most cost effective, secure and efficient route for their tenants.
The first and possibly most risky consideration is the need for the use of a cloud provider, which essentially introduces a middleman into the mix. This creates a number of issues, the largest of which is that the housing provider becomes dependent on the managed IT service provider to make sure that the cloud server is ‘up’ so that the organisation isn’t ‘down’. Even the best cloud service providers can have downtime, and that essentially means the housing provider can too. Back-up and contingency planning are essential for obvious reasons, but all too often they’re forgotten or untested until the 11th hour, when they’re actually needed. The risk is further exacerbated when an entire infrastructure is run across one provider; what happens if they increase their prices overnight or worse, they’re out of business tomorrow? Even where reliance is on multiple providers to spread the risk, the infrastructure is still in the hands of someone else and still at the mercy of their decision-making. The only way to eliminate this risk entirely is to manage your own infrastructure and take it out of the hands of the cloud providers or, at the very least, spread your risk.
Security issues follow much the same argument, and have been the centre of the debate since cloud first started. Actually, there are gains to be made for small organisations who can’t afford the same level of security as their managed service provider delivers to them, but when housing providers are putting tenant data online, it should be top of the list to make sure that the cloud provider has the latest encryption and security technology. Larger providers could be putting their data at risk, especially if they have sensitive financial or personal data to protect.
Long-term cost of the cloud
Cloud undoubtedly provides benefits in terms of being able to scale costs up and down inline with computing demand, as well as much less capital costs to get started. But scalability can come at a price; on a small scale and for short-term projects, the cloud can be expensive. The cost per hour of a cloud server can be much more than the cost of a server as an asset over many years of use and for some housing providers with larger computational workloads, it makes more sense to run those workloads internally rather than putting them in the cloud. Those housing providers that need to be up and running on full power 24/7, which many more are doing as they put more of their services online, will probably find that cost-wise, it’s much more effective to own your own servers. Plus it’s often the case that organisations have already made the outlay in terms of expense that cloud helps to avoid, such as hardware and people. The costs of in-house solutions decline in the long run and so buying more hardware can help spread the fixed costs, thereby reducing the overall expense. By contrast, moving to the cloud would increase those costs.
Often entrusting the housing provider’s network to a third-party cloud provider means that it trusts its work to a company using proprietary software (i.e. technology that the cloud provider owns). This isn’t a major issue unless the provider becomes locked into a price structure, which then means much less freedom and possibly less long-term innovation. However, it pays for housing providers to take control over the long-term to ensure that innovation isn’t stifled.
Cloud computing from a technological standpoint is also network hungry. The housing provider’s infrastructure must be able to cope with handling heavy server loads because everything it does will be online. It must also be able to deal with the surges at peak times of day, such as during lunchtime when users’ devices are likely to be used in conjunction with the network. Using traditional software significantly reduces the load on the network and requires less Internet usage. There is a trade-off between losing some of the functionality found in on-premise software in order to provide everything via a web browser. Undeniably, as we move towards the digital tenant where all services are provisioned online for them, any web-based system must be able to cope sufficiently to deliver those services in line with tenants’ expectations or risk the non-adoption of self-service facilities.
Cloud isn’t a utopia, but it is the way the technology industry is moving and we take it very seriously in terms of looking to the future. But, the downsides must be taken into account before systems are ‘ripped and replaced’, by which time it’s too late to do anything. Cloud adoption has disadvantages that must be planned for and managed along the process, and an understanding that there may be lasting disadvantages in terms of the pressure on the housing provider’s network infrastructure and some loss of functionality.
Chris McLaughlin is managing director of MIS-AMS.