Small Businesses Trail Blazers in Cloud Storage

Entrepreneurs and small businesses have led the way in cloud storage adoption and still comprise the largest faction of cloud users, but this is quickly changing. Larger companies are following suit, investing more in cloud technology to meet their business infrastructure needs in today’s global, distributed business environment.

Businesses have always had the need to store, share and back up data. Traditionally, this was done with on-site physical file servers, tape backups, file transfer protocol (FTP) and virtual private network (VPN) systems. While these methods offer high speed and performance, they are expensive and increasingly impractical and cumbersome in today’s collaborative business world.

Today, companies need to manage and share their data across geographically distributed teams as well as across partner and customer ecosystems. They also need to ensure they have access to the data they need, anytime and anywhere. Cloud computing has become a significant technology trend to this end, and many experts expect it to reshape information technology processes and the IT marketplace in the next five years.

Market research firm IDC expects IT cloud services spending to grow from about $416 billion in 2008 to about $42 billion by 2012. IDC also predicts cloud spending will account for 25% of annual IT expenditure growth by 2012 and nearly a third of growth the following year.

Small businesses have been quick to embrace the cloud, paving the way in cloud adoption and enjoying the cost-benefits and efficiencies of a dynamic business infrastructure.  However, larger enterprises have--until recently--been more hesitant to adopt cloud services. Their reluctance is partly due to their greater sums of money and resources at stake, as well as concerns over security, visibility and control and reliability in a relatively new technology.

Yet research and experience shows that this trend is changing as increasingly-large enterprises are gaining trust in the cloud, and therefore adopting cloud services. For example, trials of Egnyte’s cloud storage technology by small companies tripled year-over-year from March 2010 to March 2011, but trials of larger companies weren’t far behind, increasing 2.5 times from the previous year.

Data from a recent survey by Egnyte supports this trend by underscoring the popularity and pervasive use of cloud services and software among small businesses, but also uncovering growth of cloud among larger organizations. For example, the survey found that in recent months, midsize companies have suddenly and rapidly embraced cloud storage technology in record numbers. And a recent report by Storage Strategies NOW further adds fuel to this trend, stating that 57% of large companies plan to adopt cloud services in the near future.

The significant increase in larger companies tapping the cloud across the country reflects a desire to maximize return on investement and accommodate a distributed team, while leveraging a secure resource. One of the primary driving forces within this context is the growth of the mobile workforce. With servers accessible via the cloud, mobile workers can easily perform file operations regardless of location.

The recent Egnyte survey suggests that mobile workers are wasting no time making use of the cloud: Small businesses conducted more than 4.5 million file operations in a 24-hour period, an average of more than 3,000 file uploads, downloads and edits per minute. Nearly 15 percent of these were conducted over a mobile device, with iPads used the most (36 percent), and iPhones and Androids tied for second (30% each). While, according to the survey, small businesses of five employees are the most likely to access files in the cloud from mobile devices (39%), larger companies employing more than 50 people were close behind at 30%, and midsize organizations with 25 employees came in third at 28%.

Cloud services and software are making a big impact on large and small organizations alike, in every industry. As current trends show, it is likely we will continue to see more and larger organizations adopting cloud services in the coming years.

Vineet Jain is the CEO and co-founder of Egnyte. Prior to Egnyte, Vineet founded and successfully built Valdero, a supply chain software solution provider.