Cloud Computing: Small Companies Take Flight

(page 2 of 2)

asp?capId=44005402'>RightScale, which provides management tools and consulting to companies that want to develop applications on Amazon Web Services like EC2. In contrast, developing for Amazon Web Services can be more complex, but developers can choose from a wider range of programming and scripting languages.

Photo- and video-sharing service Phanfare decided to use Amazon's S3 service, designed for developers who want easy access to storage over the Internet. The average Phanfare user stores about 5 gigabytes worth of photos and video on the site, which means that the company needs about 83 terabytes of storage. When Phanfare started using Amazon's S3 service, its storage costs were cut nearly in half. "It went from $5 or $6 per gigabyte to about $2 or $3," says Andrew Erlichson, CEO and co-founder of Phanfare. Erlichson says his company could have built out the storage itself, but it would have taken an engineer about a year. "Our differentiator is software development; it's not storing data on generic disks," he says.

A Buffering System

Still, handing over the keys to part of your business has its risks. On July 20 the Amazon S3 storage service suffered an outage. Erlichson estimates that his company was affected for about 8 hours. But because he and his partners had some foresight and anticipated potential outages, they'd created a buffering system that essentially can manage down times for a day or two before it would create problems on the site. Erlichson spent July 20 at the pool. "If we'd been down that afternoon, it would have been horrible but not catastrophic," says Erlichson, "We're not running an ATM network here."

Schumacher's Menefee says he feels comfortable with the level of reliability he's getting with Salesforce.com. He's got a 99.99% uptime service level agreement and he knows the Salesforce.com data center is monitored 24 hours per day. The advantage is that he gets the technology infrastructure to do what his company wants, without the costs and headaches. "As a midsize business, I can't afford that kind of infrastructure support [myself] while driving innovation," he says.

Business Exchange related topics:
Cloud Computing
Cloud Computing Research
Marketing Strategy
Small Business Technology

King is a writer for BusinessWeek.com in San Francisco.