CHICAGO ( TheStreet) -- The term "cloud computing" has a peaceful -- even dreamy -- sound. But the phenomenon may be causing stress-induced nightmares in IT departments across corporate America. It represents a dramatic shift in the way computer programs and data are saved. Many small businesses are wondering if and how the cloud applies to them.
The good news: There's no reason to panic. While cloud computing has big advantages for certain industries, it's by no means a magic solution for everyone.
If you're not in the tech business, you might not even be sure what cloud computing is. At the most basic level, it means storing your computer programs and files on the servers of a third-party provider, rather than on your own hardware. (Think of all that data forming "clouds" of information that float from office to office.) You pay a monthly fee to access particular computer programs, back up your systems or store records that would otherwise overload your own servers.
Many small businesses have already begun using this kind of a subscription model for software. In the old days (a whole decade ago!), trying out a computer program meant buying a disk, installing the program on your computer, then accessing it by clicking a desktop icon.Now, more and more software is available through the Internet and bought on a subscription basis. You sign up through a website, log on to the program through the Internet and pay a certain price per month according to your usage; nothing is installed on your computer. GoToMeeting.com (for web conferencing) and Salesforce.com (CRM) (collaboration relationship management systems) are examples of this trend. This element of cloud computing, known by the acronym SaaS ("Software as a Service") has many pluses for small businesses. You can try out different programs relatively cheaply, without making a costly investment in software. You also don't need to pay an IT guy to install them. But adopting cloud computing throughout your company is a much bolder step. Does moving all your data and applications to another location make sense? For certain companies, there are advantages: