Slow Changing Industries Move To The Cloud and Save Money

Businesses hear how forward thinking and exciting it is to have a cloud within their business. It makes the business run smoother, clears up unwanted paper and files, and it makes the company look digitally modern. However, can the cloud save a business money or is it just another headache?

Rackspace is one of the top cloud companies in the marketplace today. Of the top 100, Rackspace ranks 9th just behind Google and Amazon. Rackspace offers both private and public clouds for individuals and companies. Their technology, similar to most other clouds, allows for instant syncing of data to their “cloud” servers, which can be accessed by a user or company. This allows the company or individual to organize all their information into one place that can be accessed anywhere. This sounds well and good, but can Rackspace, or any cloud, save a company money? In an interview with Ajit Melarkode, general management executive at Rackspace, he says, “the save overall for companies is converting capital expenditure into operating expenditure.” This means that a company is not spending any money on costly IT setup fees and procurement costs, they use a cloud vendor, like Rackspace, to administer and manage the cloud. The money that would have been spent on costly custom IT, can now be plowed back into the business' normal operating income.

So who has actually saved money moving their business to the cloud? Let's take a look at an industry that is very slow to change, construction. Webcor Builders is a general contractor who has big name clients like eBay & Lucas Films and have recently moved their business to the cloud. In an interview with Vince Sarubbi, Webcor’s CTO, he says, “we’re using [the cloud] for architectural drawings, for virtual building files, everything down to simple PDF’s…up to very large virtual building multi gigabyte files, through Box.com.” Webcor stores a ton of data in the cloud that they then can access later through their iPads. They use an app called PlanGrid that allows Webcor to view and edit all their virtual drawings anywhere on their iPads. Furthermore, this complete business integration allows Sarubbi to harness the important data, “its really in your costs, how you control costs… that’s your true data,” says Sarubbi. This is where Webcor understands the power of the cloud, being able to control costs efficiently and not just saving money with cheap setup costs.

What about the government? Are they able to save money with the cloud and make it cost effective? Recently, the Department of Interior awarded $10 billion dollars in contracts to accelerate their large transition to the cloud. Even though their migration has a costly price tag of $10 billion, they will be able to save even more money in the long run with their new cloud system. According to Andrew Jackson, not our 7th president but Deputy Assistant Secretary for Technology, Information and Business Services, “we expect to result in benefits of $100 million each year from 2016 to 2020.” Their goal is to make access to the public and DOI employees around the world easier and more efficient. “Our hosting environment, which currently focuses on managing servers in-house, will be able to transition to a modern cloud-based environment,” says Jackson.

Both Webcor and the Department of the Interior have embraced the concept of the cloud and understand its potential and both of them exist in an industry where change is cumbersome. However, the construction industry, other branches of government, and industries all over the world should look towards Webcor & DOI as a cloud guide. If construction and government can financially benefit from the power of the cloud, then there should be no excuse to transition to the cloud.

Everyone Thinks It: Is “The Cloud” Safe?

To the non-tech savvy individual who honestly thinks “The Cloud” exists in an actual cloud, would probably tell you that it is not safe. Understanding that personal & business data is instantly synced with a server in “The Cloud” doesn’t sound very safe to begin with, so one would be inclined to agree with the non-tech savvy individual. However, it turns out that “The Cloud” is actually pretty safe and we’re finding ways to make it even safer.

Google, one of the top leading Cloud companies in the market, has recently upped their cloud safety game in an effort to make data in the cloud more secure. According to The Verge, “The move is intended to protect, companies developers, and ultimately your data from prying eyes, utilizing the 128-bit Advanced Encryption Standard (AES).” Therefore, once you sync your data from you computer or mobile device, it will then go through Google’s 128-bit encryption process before it is “saved” on their end. Furthermore, to then unlock the data, Google’s system uses a master key. This master key, which Google refused to comment about, is rotated regularly to avoid normality and encourage uniqueness. 

Google is usually the first to get recognized when there is a change in technology just because Google is Google. Therefore, we do not usually hear, as quickly, what the other leading cloud companies have done until Google makes their statement. Amazon’s cloud security, on the other hand, does circles around Google’s mere 128-bit encryption. According to TechCrunch, Amazon’s cloud has been “using the 256-bit Advanced Encryption Standard since abound 2011.” Moreover, besides having more bit encryption than Google, Amazon uses a different type of master key than Google, called a Hardware Security Module, that helps manage data and master keys. According to a recent survey, Amazon was ranked 2nd ahead of Google, ranked 5th, in the top 100 cloud companies from 2012-2013. 

Although Google and Amazon have beefed up encryptions and have crazy secure master keys, ARM, a UK based chip designer, has decided to make encryption personal. ARM, best known for their work with SIM cards in Europe, has developed a chip, running on a token system, that will allow security encryption at the user level. According to Forbes, “it would give individuals direct control over their data, right from the mobile device or sensor where it is first collected and transmitted.” The token system will allow users to determine who and what gets to access their data; once all the tokens are gone, the data is locked. The article continues with Mike Muller, ARM’s CTO, explaining the concept by comparing it to a household scale. Mike does not mind his wife seeing his weight on their shared mobile phone app. He’d also tolerate his gym accessing the his weight to help guide his fitness regime. But he wouldn’t want anyone else, and certainly not his life insurer, to know when he’s gaining weight.