2010 is set to be the ‘year of the cloud’ for UK SMEs, following a huge change in outlook over the past 15 months, but many are still failing to implement formal strategies to help safeguard their businesses, according to a report released today by my company.

Compared to a similar report in October 2008, the report shows a significant increase in small businesses using or planning to use cloud computing within 12 months (22% at the end of 2008 vs. 50% at the end of 2009). Those with longer term plans to deploy cloud computing within five years has gone up by approximately two thirds, rising from 47% in 2008 to a staggering 73% in 2009.

In addition, the number of businesses stating they would never move into the cloud has halved over the last 15 months from 53% to just 27% of those surveyed.

Despite the huge move to the cloud, the last 15 months has seen little increase in the number of businesses putting in place safeguards such as increased security and more reliable internet connections. For example, 85% do not plan on taking extra security measures and 71% do not have any formal strategy in place for implementing cloud computing.

In addition, over 80% of businesses are not planning to increase their internet bandwidth and the majority of respondents (80%) are still using asymmetric connections such as ADSL broadband as part of their connectivity packages, as opposed to symmetrical connections such as SDSL and leased lines. This means many businesses may be lacking the bandwidth and, more importantly, the upload speeds needed to fully support cloud computing.

Small businesses appear to be more convinced than they were in 2008 by the main benefits of cloud computing. Whereas in 2008, 35% believed cloud computing would save them money, this has climbed to 51%. Similarly, in 2008, 35% saw cloud computing as helping enable home working, now 43% consider this to be true.

Cloud computing has been on the business radar for some time and our report proves that we are at the tipping point for mass adoption amongst small and medium sized businesses. As a company which itself has adopted cloud computing, we find it worrying that the vast majority of companies aren’t taking basic measures to prepare themselves for such a significant shift in their business operations, such as creating a formal migration strategy, increasing security, ensuring they have a reliable and good quality internet connection or considering the impacts on their bandwidth and data demands.

Small businesses are using up more bandwidth than ever before, with applications like video conferencing, IP telephony, media streaming and large file transfers all competing with cloud applications for vital bandwidth. Businesses should specifically consider their upload and not just download speeds, as these can be vital for supporting cloud computing and sending data efficiently.

Symmetrical Internet connections such as SDSL and leased lines are therefore increasingly attractive for small businesses today. Many companies will reach a point where their Internet connection is the most important part of their business continuity plans, which is why it is vital they are aware of how their bandwidth is being used and how reliable it really is.

Key Facts/Highlights:

  • At the end of 2008, 53% of SMEs said they’d never adopt the cloud. Now just 27% share this view
  • Compared with last year’s timeframe of adoption within 5 years, 73% plan to make the switch in this timescale, compared to 47% at the end of 2008
  • Larger SMEs (with 50+ employees) are the keenest to adopt cloud computing, with 66% already using the cloud or planning to do so within 12 months
  • 81% are not planning on increasing Internet bandwidth
  • 80% of businesses are using ADSL connections which may not supply the upload speeds needed to support cloud computing
  • Sales, media and marketing companies are the most cloud-savvy, with 30% already using cloud software and 40% planning to do so within two years
  • London is the most cloud-savvy region, with 70% of SMEs to be using cloud computing within 12 months and among the fewest never planning to do so (at 17%)
  • Only 13% of SMEs claim cloud computing isn’t secure enough and just 9% say it isn’t reliable
  • Only slightly more SMEs are increasing internet bandwidth as they adopt the cloud (19% in 2009 vs. 13% in 2008), although this is still very low
  • Businesses advised to examine their overall bandwidth and Internet reliability requirements – specifically their upload needs and the comparative benefits of ADSL and SDSL connections.

Author profile: Chris Stening

Chris Stening is managing Director of Easynet Connect, one of the leading providers of quality connectivity and Internet access for small to medium size businesses in the UK. Chris has been responsible for building Easynet Connect’s enviable reputation for quality, innovation and excellent customer service and under his direction the company recently launched its 20-day installation pledge for its EtherStream and SureStream products, the shortest of the few installation pledges currently available on the market.
Chris first started with the company in 2003 when he joined UK Online, part of the Easynet Group, to help drive its growth and development with the introduction of exciting new services based on Local Loop Unbundling. Chris has a first class BA Honours in Business Studies (with Marketing) from the University of Hertfordshire and CIM Diploma in Marketing.