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Making Sense of Hybrid Cloud Solutions for Small Business

In our blog, Public Cloud Use Cases for Small Business, we covered different scenarios where a Public Cloud solution makes sense for a small business and why Australian small businesses are choosing Public Clouds for their IT needs.

But what if the IT needs of your small business aren’t cookie cutter? Perhaps you store confidential customer information that requires additional security, or you’re in an industry that requires compliance with regulations that prevent you from using a Public Cloud. If you fall into one of these two scenarios, Hybrid Cloud solutions for your small business may be ideal.

Small businesses don’t always have the resources or budget that large enterprises have, so they seek a Hybrid Cloud that provides the benefits of both a Private and Public Cloud. In this blog, we will discuss when Hybrid Cloud solutions for small business make sense.

Public, Private and Hybrid – What’s the Difference?

In a Public Cloud scenario, you share your Cloud resources – servers, storage, and applications – with other tenants through a third-party Cloud service provider. A Private Cloud is a secure Cloud-based environment in which only you operate, and a Hybrid Cloud is a mixture of the two – a Cloud computing environment that uses a mix of on-premises Private Cloud and third-party Public Cloud services, and also provides the opportunity to transfer between the two platforms.

Are Australian Small Businesses Moving to a Hybrid Cloud?

As mentioned in our previous blog, 86% of Australian companies are already using Cloud in their production environment. A report conducted by Telsyte found a growing trend in Hybrid Cloud, concluding that 40 per cent of enterprises will be using this model by 2019.

More and more businesses are choosing Hybrid Cloud solutions.

Why Are Australians Choosing Hybrid Cloud Solutions for Small Business?

The growth in business use of Hybrid Cloud can be attributed to the fact that Hybrid Cloud brings together the benefits of a Public Cloud scenario – such as cost savings and scalability – with the benefits of a Private Cloud scenario – security and control – in a custom-made hybrid solution. Australians that select Hybrid Cloud solutions for small business enjoy the following benefits:

Additional Resources

A Hybrid Cloud from a managed Cloud provider becomes an extension of your IT department. This provides additional resources you can use to outsource the day-to-day management of your IT, freeing up your internal resources for more strategic initiatives.

Infrastructure Costs

This is especially important for start-ups; a Hybrid Cloud reduces the expenses associated with an on-premise solution, incurring no upfront equipment costs to the small business. Hybrid Cloud’s pay-per-use model permits businesses to pay for only what they need , which can be very appealing to a small business – start-up or not.

Agility

A Hybrid Cloud allows a business to transfer between Private and Public Cloud to meet variable demand. Especially important for those companies that are relatively young and don’t know what to expect in terms of site traffic – this allows them to move between Private and Public Cloud as their needs change, providing the business with more flexibility.

Flexibility

A business can use an on-premise Private Cloud to host sensitive information and use the Public Cloud to host less critical information; allowing it to meet regulatory compliance standards and keep sensitive information secure.

Common Concerns About a Hybrid Cloud

Despite the benefits offered by Hybrid Cloud solutions for small business, companies may still be apprehensive when deciding on a Cloud solution for any of the following reasons:

Loss of Control

Day-to-day administration is out of their hands and managed by a hosting provider, a concept many businesses may be uncomfortable with. While this is a valid concern, businesses that can accept handing off some control no longer need to worry about the day to day management of IT, as this is outsourced to the provider, which frees up IT resources.

Security Concerns

Some companies may be concerned with security of a Hybrid Cloud solution as some data is stored in a Public Cloud environment. The simple solution to this concern is to store any critical data on-premise or in the Private Cloud.

Interruption in Business Operations

When migrating to a Hybrid Cloud, companies – especially those with legacy systems – may fear integration problems that could interrupt business operations. The opposite is actually true, as a Hybrid Cloud helps fill the gaps between Cloud and legacy infrastructure.

Considering a Hybrid Cloud For Your Small Business?

Ask Yourself the Following Questions:

  • Is it vital for your users to have fast, reliable access to data?
  • Are you concerned about downtime?
  • Do you have remotely located users?

If you answered “yes” to any two of the three, you should consider a Hybrid Cloud.

If you have remotely located users who require fast, reliable access to data, then you should consider a Hybrid Cloud.

Which Australian Small Businesses Are Moving to a Hybrid Cloud?

A Hybrid Cloud may not be the ideal solution for all small businesses; however, many benefit from the flexibility that it provides. Here are five Hybrid Cloud use cases for small business:

  • Hybrid Cloud Use Case 1: Companies with Legacy Appilcations
    Rather than incurring the costs of updating legacy systems, some businesses are opting for a Hybrid Cloud to fill in the system gaps, allowing them to salvage legacy applications without full migration.
  • Hybrid Cloud Use Case 2: Start-Ups
    As mentioned above, a Hybrid Cloud is an attractive option for start-up companies that want to minimize their capital expenditures and avoid investing in expensive equipment.
  • Hybrid Cloud Use Case 3: Untested Workloads
    Companies that regularly launch and test applications can test new applications in the Public Cloud to work out the bugs before investing in launch in a Private Cloud.
  • Hybrid Cloud Use Case 4: Ecommerce Sites Facing Seasonal Traffic
    Hybrid Cloud solutions for small business offer an attractive option for companies with eCommerce sites that receive seasonal spikes in traffic, or companies who don’t know what to expect in the way of site traffic. Cloud bursting provides the ability to run an application in a Private Cloud and burst or migrate to a Public Cloud when demand for computing capacity spikes.
  • Hybrid Cloud Use Case 5: Regulatory Requirements
    A Hybrid Cloud works well for organisations within industries that have regulations dictating that data must reside within a specific country or in a Private Cloud. A Hybrid Cloud allows businesses to comply with industry regulations and keep critical data in a Private Cloud, but also provides the ability to utilize Public Cloud for cost-savings and efficiency.

If you are contemplating making a move to a Hybrid Cloud, these cases should help you determine whether this is the right solution for your business. Ensure you consider the following factors:

  • Budget: What is your IT budget?
  • Security: Do you have any industry regulations or compliance requirements that can benefit from a Hybrid Cloud solution?
  • Resources: What internal resources do you currently have, and can you benefit from the expertise of a Cloud provider?
  • Disaster Recovery: What is your current disaster recovery strategy and what are your needs for the future?

If you would like more information on migrating to the Cloud, we’re here to help. StudioCoast has been helping Australian small businesses with their hosting needs since 2002. Contact StudioCoast today.

Cloud Computing Regulations in Australia

According to analyst firm, Frost and Sullivan, the Australian Cloud services market is expected to grow to $4.55 billion by 2018. This is almost quadruple the $1.23 billion in revenue that the market generated in 2013, as stated in the 2014 State of Cloud Computing in Australia report. The reason companies are choosing Cloud services such as, Software-as-a-Service (SaaS), Infrastructure-as-a-Service (IaaS), and Platform-as-a-Service (PaaS), is because of the cost savings associated with moving to the Cloud; on average organisations are saving 12 percent in IT costs.

Cloud Security Concerns for Australian Businesses

Australian businesses have been slow to adopt Cloud technology. The Australian Bureau of Statistics conducted a survey on paid Cloud computing in Australian business and found that less that one in five Australian companies reported using a paid Cloud service. Among enterprises, security breach topped the list of reasons why companies are slow to adopt the technology, with 19% of this group citing uncertainties about the location of data as a reason.

The Frost & Sullivan report also confirmed that security concerns are still a major roadblock when it comes to companies considering a move to the Cloud. The report found that 38% of organisations are more concerned about IT security since adopting Cloud computing and security was still a major factor impeding growth of the Australian Cloud services market. This report cited these three main security concerns:

  • Relinquishing control over key business processes and data
  • Risks around disaster recovery
  • Reliability of back-up services

Concerns for Each Type of Cloud Service

As a provider, we are concerned that there is still such a concern surrounding the security of Cloud computing, so we are here to help qualm any fears. In this blog, we will focus on the issue of relinquishing control over data, the privacy issues encompassing this and Cloud computing regulations in Australia. Migrating to the Cloud and relinquishing data in some instances means giving your data to a provider who may store your data in an offshore location, in a country that may have privacy laws that are less stringent than that of Australian laws. But before we delve into the Australian Privacy Laws, let’s look at what the actual concerns are and how they relate to each type of Cloud service.

Privacy concerns can differ depending on the nature of the particular Cloud service – SaaS, PaaS, or IaaS. The degree of concern for privacy is determined by how much access your service provider has to your data, as well as where your data will be stored. If your data stays with you, the customer, then there may be less concern, but if data is in the possession of the service provider, then you must ensure that your vendor complies with Australian Privacy Laws.

For instance, in an IaaS model, the data may not be transferred to a vendor and may stay with the customer. The customer takes ownership of the liability for the privacy of the information of this data. In a managed SaaS scenario, if the provider manages the data, the provider is responsible for complying with Cloud computing regulations in Australia, to ensure that the customer’s data is secure.

What it really comes down to is that when you are determining the best Cloud solution for your business, if it involves moving your sensitive data to be managed by a Cloud provider, possibly in an offshore location, make sure you know where the data is being stored and if the provider complies with Cloud computing regulations. Before we cover what to research when looking for a Cloud provider, we’ll cover exactly what the Australian National Privacy Act is.

The Australian National Privacy Act regulates the collection, holding, use, and disclosure of personal information.

Australian National Privacy Act (1988)

The Australian National Privacy Act regulates the collection, holding, use, and disclosure of personal information. Any private or public sector organisation, including Cloud providers, need to comply with 13 principles that regulate the collection, holding, use, and disclosure of personal information.

What Does the Privacy Act Cover?

Australian Privacy Laws make it difficult for Cloud providers to move sensitive information and store it outside of Australia. The Act regulates how organisations collect, store, secure, and disclose personal information. The National Privacy Principles (NPP) set out in the Act are designed to ensure that organisations holding personal information about people handle it responsibly, as well as take the steps necessary to protect the personal information it holds. This ensures that they also have thorough security Service-level Agreements (SLAs) in place that define audit rights, reporting, data location constraints, and access right provisions when cross-border disclosure of personal information are involved – when data leaves Australia. Cloud providers will focus on two key principles:

APP8: Cross-Border Disclosure of Personal Information

The Australian Privacy Principle 8 regulates the disclosure and transfer of personal information by an agency or business to a different entity (including a parent company) offshore. Before an Australian Cloud provider discloses personal information offshore, it must take reasonable steps to ensure the overseas recipient will comply with/not breach the APPs. This can be done by appropriate contractual provisions. The Australian Cloud provider will remain liable for the personal information, in most cases.

APP11: Security of Personal Information

Australian Privacy Principle 11 requires that an organisation must “take reasonable steps to protect the personal information it holds from misuse, interference and loss and from unauthorised access, modification or disclosure”.

Customers are concerned about their security and privacy in the Cloud.

Why Are Customers Still Concerned about Security and Privacy?

If your Cloud provider is based in Australia, rest assured that your provider must comply with the Cloud computing regulations in Australia, put in place by the government. You should, however, be aware if your provider has a data centre outside of Australia and whether the country in which it resides complies with the Australian Privacy Laws. If you’ve selected a Cloud provider that is based outside of Australia, you will want to research the privacy laws of the provider’s country as well as the countries where its data centres are located. In this instance, you should pay special attention to whether or not each particular foreign government has the right to access your data. Luckily, regulations in Australia make it difficult to move sensitive information to Cloud providers that store data outside of Australia, so the key is to find a trustworthy Cloud provider. When searching for a Cloud provider, keep security top of mind and make sure you uncover the answers to the following questions before you sign a Service Level Agreement.

What to Ask Your Potential Cloud Provider

When you research Cloud providers, make sure that you ask the following questions when negotiating an agreement:

  • What information will be placed in the Cloud – personal, confidential, customers, employees?
  • What are the regulatory issues that your company must comply with and how they can support this?
  • Where are the vendor’s data centres located and what foreign laws apply to the data?
  • What is their disaster recovery process to protect/recover your information?
  • What is their reputation for complying with the Cloud computing regulations in Australia?
  • Who holds ownership of the data in the Cloud?
  • How do they manage security breaches and what are their disaster recovery methods?
  • What is the process in the event that you need to transfer your data?
  • Will your provider do anything with your data for their own purposes?
  • Who can access your data? Do they have strict policies in place as to who can access your data?
  • Is your data separate from other clients? How is it separated?
  • Who owns and has access to backups?
  • What regulations do they adhere to?

Lastly, remember that as a business, it’s your responsibility to get consent from any of your customers whose personal information you will be collecting. If you would like more information on how we can help you migrate to the Cloud, contact StudioCoast today. StudioCoast has been helping Australian small businesses with their hosting needs since 2002.

Public Cloud Use Cases for Small Business

The conundrum of Public Cloud vs. Private Cloud and which one is best for a small business is a common topic that many of our small business customers inquire about. Unfortunately, there isn’t a simple solution. When a small business owner is in the process of moving to the Cloud and is determining which solution is best for the business, there are a lot of considerations to take into account. In this blog, I will focus on examining Public Cloud use cases and whether a Public Cloud is a good solution for a small business. Before pondering further, let’s define what a Public Cloud is.

Public Cloud – What is it?

A Public Cloud is a multi-tenant environment, where you buy space in a Cloud computing environment that is shared with a number of other clients or tenants. You share the Cloud infrastructure with other organisations and rely on the third-party Cloud service provider for servers, data storage, and applications. This can come in the form of Public Cloud hosting services, such as Windows Azure Services, or storage services like Dropbox.

Are Australian Small Businesses Moving to the Cloud?

In Australia, the Cloud is becoming more mainstream. Results from a study released by Infosys and commissioned from Forrester Research revealed that 81% of respondents are using or planning to use mission-critical applications in the Cloud in the next two years. Australian organisations are leading the way, with 86% of Australian companies already using Cloud in their production environment, while only 50% are doing so in the US, and nearly 60% across Germany, France, and the UK. Gartner forecasted that the Public Cloud services market in Australia would hit $4.15 billion in 2015, a 24% growth from 2014, and this number is expected to reach $4.74 billion in 2016.

There are numerous reasons why Australian small businesses are choosing a public Cloud.

Why Are Australian Small Businesses Choosing a Public Cloud?

A Public Cloud may not be the ideal solution for all small businesses, but there are certainly several benefits that make it an attractive option for many. What follows are some of the reasons why the Public Cloud is a popular choice:

Scalability

With a Public Cloud, infrastructure resources are available on demand, making it easy for a small business to scale up very quickly to meet an increase in traffic. Rather than hiring additional resources and purchasing infrastructure to meet demand, it’s easier for a small business to simply notify the provider when more services are required, and the provider will be able to deploy the resources much faster than is possible with a dedicated network.

Reliability

Hosting your data in a Public Cloud provides an extra level of backup in the event of a disaster or service interruption. Cloud providers have several data centres, so if there is an issue with your site or a data centre, there is another data centre that will be available as backup. A Public Cloud provides that extra layer of protection to ensure that your site stays up and running.

Cost-Effectiveness

The best part about a Public Cloud solution is that you don’t have to pay for the resources you don’t use. This is due to the shared resources of the other organisations that are sharing this same Public Cloud.

Infrastructure Costs

There are none. A Public Cloud will help your business eliminate the upfront infrastructure costs that you would incur with a dedicated network. This scenario allows companies to pay as they go and only pay for what they use, avoiding the upfront costs of paying for infrastructure that they may or may not use. Especially for businesses just starting out, this can be a huge advantage, as they will avoid the large start-up costs of purchasing and managing the hardware and software infrastructure.

Is the Public Cloud for All Small Businesses?

If a Public Cloud sounds good so far, your next step is to ensure that is will be the best scenario for your business. A common concern for small business owners is whether or not a Public Cloud is secure. Again, it’s not that Public Clouds aren’t secure – it’s just that some businesses need additional security. If that’s the case with your business, you may want to opt for a private or hybrid solution. It’s important to consider the amount of security your business will require, how critical your data is, and if there are any regulatory or industry compliance standards that need to be followed. There may be industry guidelines that prevent a business from using a Public Cloud, such as those present in the financial or health care industries, where additional layers of security are needed to protect confidential and private information.

If your small business needs additional security a private or hybrid Cloud may be the right solution for you.

Which Small Businesses Are Using a Public Cloud?

Businesses of all types use a Public Cloud, but as I mentioned above, it isn’t ideal for all industries. Less sensitive companies, or organisations that require their Cloud resources quickly and cheaply and have less critical data, favour a Public Cloud scenario, as there are several advantages. What follows are five public Cloud use cases, demonstrating small businesses that would benefit from this solution:

Public Cloud Use Case 1: Start-Ups

Public Clouds are a good choice for start-ups that don’t have access to a surplus of capital since a Public Cloud eliminates the up-front costs of expensive infrastructure by utilizing the Cloud provider’s servers, hardware, and software. Start-ups will also benefit from the expertise of their Cloud provider, eliminating the need to hire costly IT resources. This will reduce the IT resources and associated costs by outsourcing the management and maintenance of the IT to the provider. Public Clouds also help cash-strapped start-ups as providers generally offer them on a pay-as-you-go basis, keeping costs down by allowing businesses to pay for only the resources they require. This is especially important for small business owners that may not know what to expect in their first year and aren’t sure of what to expect in terms of spikes in traffic.

Public Cloud Use Case 2: Seasonal Businesses

Businesses with seasonal spikes in website traffic that require the ability to adjust their resources accordingly will benefit from a Public Cloud scenario. A Public Cloud allows these organisations to scale up or down as needed, both easily and affordably. We have heard the horror stories of sites going down due to large spikes in traffic, especially during peak shopping times like Black Friday and Cyber Monday. For eCommerce sites that need the ability to scale up or down according to website traffic, a Public Cloud is a safe scenario, as they can rely on their hosting provider to adjust resources accordingly, which reduces their risk of having a site disruption during key sales times.

Public Cloud Use Case 3: Reduce CAPEX

Whether it’s a small business that’s just starting out and has limited access to capital, or a mature organisation looking to cut costs, moving to a Public Cloud scenario will allow an organization to reduce their capital expenditure (CAPEX) and move to an operational expenditure (OPEX). Rather than investing funds in acquiring and constantly upgrading infrastructure, moving to a Public Cloud will allow an organisation to outsource the infrastructure to the Cloud service provider, which will allow a more favourable OPEX model, where the business pays a month-to-month, subscription-based fee.

Public Cloud Use Case 4: Heavy Marketing and Social Networking Presence

Companies with an aggressive marketing strategy that run several campaigns a year will benefit from a Public Cloud solution. If the company is running temporary marketing campaigns or having to develop promotional sites quite frequently, a Public Cloud provides the opportunity to launch sites and scale resources quickly and efficiently, adding resources as needed, and paying only for what is used. Companies can also move their testing environments to the Public Cloud and test campaigns prior to launch to work out any bugs. Additionally, with our reliance on social networking, a Public Cloud is the perfect place to migrate less sensitive data, like blogs, forums, and communities, to the Cloud.

Public Cloud Use Case 5: Disaster Recovery

Disaster recovery (DR) has become more attainable for small business thanks to the Public Cloud. What used to be affordable only by large organisations, due to the expense of maintaining the backup systems that are unused 95% of the year, is now affordable for small businesses as well, thanks to the Public Cloud. Disaster recovery in the Cloud allows companies to access DR when needed -– and pay for it only when they use it. For smaller companies that may lack the budget, expertise, and resources to implement a DR plan, they can hand this off to their Cloud hosting provider to manage. Furthermore, rather than having just one backup for your dedicated server, the service provider’s data centres are geographically dispersed, so if one goes down, you can utilize another.

If you are contemplating making a move to a Public Cloud, these cases should help you to determine whether this is the right solution for your business. When deciding, ensure that you consider the following factors:

  • Budget: What is your IT budget?
  • Security: Do you have any industry regulations or compliance requirements that will prevent you from using a Public Cloud?
  • Resources: What internal resources do you currently have and can you benefit from the expertise of a Cloud provider?
  • Disaster Recovery: What is your current disaster recovery and what are your needs for the imminent future?
  • Readiness: Is your business ready to move to the Cloud?

If you would like more information on how we can help you migrate to the Cloud, contact us today. StudioCoast has been helping Australian small businesses with their hosting needs since 2002. Contact StudioCoast today.

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