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1Cloud Computing Myths Exposed

Myth #1Cloud computing is riddled with major security and privacy issues

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The myth exposedSecurity and privacy concerns are the biggest inhibitor to adoption of the public cloud, but whether the risks are real depends on the provider and how great the need for privacy is (free cloud apps providers sell user information – an unacceptable risk to many firms), said Rob Enderle, principal analyst of Enderle Group.

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The myth exposedAccording to Alisdair Faulkner, cloud fraud prevention expert at ThreatMetrix, cloud providers get to know everything about their services, so cloud computing is actually safer than security managed by generalists within a company’s four walls.

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The myth exposedAccording to Dan Druker, senior vice president of marketing and business development at Intacct, most security breaches occur because of employees doing bad things. When the data is in the cloud, it’s more difficult for employees to cause breaches. To ensure the highest level of security, VARs should request a SaaS 70 audit on any service they are thinking about selling.

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Myth #2Cloud computing is not reliable

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The myth exposedAlthough free consumer cloud applications go down too frequently for their users, there are service level agreements (SLAs) attached to business cloud apps, said Enderle. Although 99.999 percent 24/7 uptime isn’t to be expected from most providers in the public cloud, private clouds can achieve higher level of uptime. Either way, they’re fairly reliable. For instance, Intacct guarantees 99.98 percent uptime.

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Myth #3It takes three years to break even and start turning a profit

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The myth exposedBoth ThreatMetrix’s Faulkner and Intacct’s Druker said it takes about 18 months (more or less time is common, depending on the margins provided by the vendor) for a VAR to hit the break even point on a cloud application. Many VARs are under the impression that it’s not possible to make money in the cloud right now. Amazon, and their partners are proving the cloud is profitable right now.

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Myth #4Cloud applications are not customizable

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The myth exposedAlthough consumer apps such as Gmail are not customizable, business apps must be customizable to be of benefit to end-users, Druker said. Both’s platform and Intacct’s cloud apps offer complete customizability, he said.

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The myth exposedThe customizability depends on the particular application and provider, and more customizability may mean a higher price tag for the app, Enderle said. Eventually, all cloud business apps will be highly customizable.

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Myth #5Integration is difficult

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The myth exposedBusinesses already used to hosted applications won’t find integration to be difficult, Enderle said. Whether integration is difficult or easy depends on the core competencies of those doing the integration. The challenge for others is in learning to manage a diverse system of servers, which is an entirely new skill set for people who have never used hosted services before.

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The myth exposedDruker said his experience is that integration is easy because the major cloud applications have very mature web services and open APIs.

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Myth #6Switching to cloud applications is as simple as flicking a switch

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The myth exposedSwitching to a cloud app has the same difficulties as switching to hosted apps, Enderle said. It requires significant staffing changes, and the business has to maintain strong relationships with the cloud applications provider. If it’s a private cloud, then there is staff training to be done. It’s not an overnight process.

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Myth #7Cloud computing is only suitable for small businesses

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The myth exposedThere’s a belief that cloud applications are simplistic and immature, but cloud apps have been around for over a decade (even if they weren’t originally called “cloud applications”), Druker said. In fact, many cloud apps vendors (such as Postini) regularly sell more than 100,000 seats to large enterprises, he said.

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The myth exposedSmall businesses are more likely to use cloud applications because it’s easier for them to make the switch than large enterprises, but cloud apps are also making their way into large enterprises, said Enderle.