Cloud Computing Value Proposition
As complexity and costs of deploying new applications and IT infrastructure have risen, many businesses cannot afford the capital and operating costs. “By 2011, early technology adopters will forgo capital expenditures and instead purchase 40 percent of their IT infrastructure as a service,” states Gartner Group. “Increased high-speed bandwidth makes it practical to locate infrastructure at other sites and still receive the same response times."

With Cloud Computing, instead of purchasing additional software licenses and hardware for new employees and new locations, businesses can simply open new employee accounts with providers of their cloudbased services to expand computing capacity. It ultimately helps CIOs rationalize their legacy systems and get their “arthritic IT” in order.

The Cloud Computing value proposition from a business perspective can be summarized:

Reduction of total cost of ownership

Transition of fixed to variable cost

Improvement of business agility and ability to build systems of a global class in less time and upfront investment

The cost model allows the business to free up budgets on infrastructure and using the resources for delivering innovation services quickly

Cloud Computing is in the first stages of adoption and the benefits, opportunities, and issues are continuing to evolve.