A List of Advantages and Disadvantages of Cloud Computing

What are the advantages of cloud computing? What are the disadvantages of cloud computing? As an enterprise decision-maker, you may be concerned about those two things. Additionally, high infrastructure costs, limited scalability, securities issues, and a lack of collaboration within your organization could contribute to your worries.

Cloud computing services can help you overcome these challenges. That’s the reason behind the widespread adoption of cloud services in industries like healthcare, fintech, ecommerce, etc.

According to a report, 69% of businesses use cloud computing services. Enterprises are increasingly drawn to cloud-based services because they provide benefits to counter risks. However, just like everything has a positive and negative side, while there are several advantages of cloud computing, there are disadvantages of cloud computing as well. And as a decision-maker, it’s crucial for you to understand these pros and cons before jumping the gun.

Go through the list below that comprises of advantages and disadvantages of cloud computing compiled by our team of cloud experts. It’ll help you evaluate whether or not it’s worth your investment.

What is Cloud Computing?

Cloud computing is a service that offers remote availability of computer systems and resources. Simply put, your data is saved on a remote server, which you can access from anywhere and anytime. There are three types of cloud deployment, which are based on the level of flexibility, control, and management:

• Infrastructure as a service (IaaS) is used for on-demand access to computing, storage, networking, and virtualization.
• Platform as a service (PaaS) used for hardware and software resources needed for cloud application development.
• Software as a service (SaaS) provides a comprehensive application stack as a cloud service with maintenance and management.

Advantages of Cloud Computing

Cloud computing migration can transform your business and offer multiple benefits. If you are planning to move to cloud-based services, it is essential to know how companies benefit from them and how you can scale up your business.

Here is a list of top benefits and advantages of cloud computing that you need to consider.

Business Benefits of Cloud Computing

Cloud computing offers several business benefits, such as cost reduction, flexibility, enhanced collaboration, accessibility, reduced time to market, and improved security.

1. Cost Benefits of Cloud Computing

You only have to pay for the resources you use. According to Rightscale, 94% of enterprise organizations use cloud computing. Cloud computing services help you reduce initial hardware and software costs. You can save 30% annually on IT expenses after moving to the cloud.

Example: GE Oil & Gas migrates 350+ applications on AWS Cloud Services by using a rehost strategy. This reduces the cost of ownership by 52%.

2. Scalability and Resource Optimization

Cloud computing offers scalability and elasticity to scale your business at your own pace. You can quickly scale resources and storage up according to business demands, such as flash sales time traffic spikes. This also reduces the investment infrastructure.

Example: You can use a replatform strategy for scalability; even a taxi app called Gett app uses this strategy to scale its business. Also, you can scale your business for better cloud security and cost-effectiveness with Google Consulting Services from expert guidance.

3. Security Benefits of Cloud Computing

Cloud computing helps you to strengthen your security position with the depth and broadness of security features.

Here are some security features you should explore:

• Transform data in an encrypted format to prevent access by unauthorized users.
• Identity and Access Management (IAM) can be used to control access to your AWS resources and manage permissions for your workforce and system.
• Provide automated threat detection and response to prevent cyber attacks.
• Ensure market standard compliance with all laws and regulations and data loss prevention (DLP) techniques to reduce breaches.
• Automatic maintenance and centralized management help your business with better cloud security.

Example: Use adequate security during the migration with practices like web application firewall, next-generation firewall (NGFW) solution, and cloud access security broker (CASB).

4. Improved Collaboration and Accessibility

You can create a collaborative environment through cloud computing. Documents are stored in a specific location and accessible through a secure credential. Additionally, it makes the discussion seamless and ensures everyone is on the same page.

Example: The Aldo group development team used the AWS AppSync service. It handled accessibility, in-store communication, and access to the required data quickly.

5. Reliability Ensuring Business Continuity

Reliability ensures business continuity, which refers to uninterrupted cloud service delivery. Multi-cloud and serverless architecture also help accelerate the development of cloud computing.

Apart from that, there are several key aspects of reliability for business continuity:

• Maintain the level of high availability (HA) by load balancing and failover mechanisms that prevent a single point of failure.
• In case of a natural disaster or cyber attack, having a procedure that ensures disaster recovery(DR).
• Creating multiple copies will ensure data availability in case of server failure.
• Automatic switch to the backup system if the primary system fails.

Example: DigitalNZ sought a new strategy as the government requested to modernize on-premise infrastructure. They use an Agile cloud-migration approach to migrate to AWS and improve reliability.

Industry-Specific Benefits of Cloud Computing

Cloud computing offers numerous industry-specific benefits, too, which vary across sectors like healthcare, eCommerce, and fintech.

1. Benefits of Cloud Computing in Healthcare

Cloud computing in the healthcare industry improves its data storage, management, data backup, and data recovery. Apart from that, a good amount of data helps in better treatment.

• Subscription-based pricing models reduce costs by paying for what you use.
• Improve data sharing and accessibility to improve healthcare with real-time patient data.
• AI/ML integration with cloud computing makes the decision-making process easier for healthcare professionals.
• Provide access to data without storing it on the IoMT devices.

2. Benefits of Cloud Computing in eCommerce

Leveraging cloud computing in eCommerce and organizations can be very beneficial. Here are some of the benefits of cloud computing in eCommerce.

• Cloud hosting scales your eCommerce business very quickly as the cloud complements the needs of the retail sector.
• One product for your eCommerce site can spike the traffic. Cloud hosting provides stability that can handle the traffic spikes for online retail.
• Cloud computing offers crucial cost savings as you pay for what you use. You can choose a subscription-based model for that and pay according to the storage and features.
• Cloud computing provides security according to the market standard certifications. This ensures eCommerce businesses are protected from DDoS attacks.

3. Benefits of Cloud Computing in Fintech

Cloud computing is shaping the fintech industry with innovative and technical advancements. Take an example of the AI integration in FinTech apps. Such integrations have been pivotal in changing the entire user experience. With AI in FinTech financial services have become smarter than ever.

Below are some of the transformations of cloud computing that have driven the fintech industry’s growth forward.

• Seamless data management through cloud computing eliminates the blind spots of data silos, which provide a clean, organized, and strong-matched data structure.
• Cloud service providers offer their services globally, which helps the fintech industry with the infrastructure.
• Cost control is achieved through subscription-based pricing models, and pay is made according to the features.
• Cloud service providers offer scalable storage that allows FinTech to maintain large amounts of data without the extensive on-premises infrastructure.
• The highest level of confidentiality by cloud providers includes access controls, threat detection, data encryption, security patching, data residency, and monitoring.

4. Benefits of Cloud Computing in Logistics

Cloud computing is changing the supply chain management in logistics. It increases scalability, agility, improved decision-making, and risk management capability.

• Enhanced real-time access to data and analytics will give the complete picture of the supply chain with trends and blockages. It will help you with decision-making.
• Improved collaboration and communication through supply chain information so that you and your partner share ideas and be on the same page.
• Scalability will increase with the cloud computing migrated transportation industry, which expands location and destinations.
• Cost saving by automating repetitive tasks also reduces costs by cutting the administrative fee.

5. Benefits of Cloud Computing in EdTech

Cloud computing can be very beneficial for the EdTech industry, whether you are a regional education institution catering to or a global education institution. Here are some of the advantages you can leverage for your EdTech service.

• Collaboration through documents helps with assignments, learning, and examinations. Additionally, the integration of tools such as email, calendars, and video sessions improves collaboration and communication.
• Accessibility through multiple devices and operating systems. This ensures that learners and educators can access it without any limitations.
• AI integration in educational apps & websites personalizes the learning material according to the student’s requirements.
• Reduced costs of on-premises infrastructure such as hardware, IT staff, and more. Also, you don’t need to pay maintenance and update costs; just pay the subscription cost, which improves flexibility.
• Automatic updates provide complete access to the latest features and upgrades. This improved cycle makes the workflow smooth for IT departments.
• Improve cybersecurity through multiple practices like multi-layered security, including SSO (Single Sign-On) protocols, multi-factor authentication, and role-based access controls. This ensures the data is well protected. cybersecurity services provider can help you to implement these practices effectively.

Disadvantages of Cloud Computing

There are a few disadvantages or barriers that you need to know if you decide to use cloud computing for your business. However, we’ve provided the best solutions and tips to overcome these disadvantages.

General Disadvantages of Cloud Computing

The general barriers to cloud computing include connectivity issues, offline accessibility, and the potential for data leakage.

1. Hidden Costs and Budget Overruns

Hidden costs are a significant challenge you must manage while using cloud computing. These costs are increased due to coordination tools and staff expertise. You may also face increased network costs when transferring data between different environments.

2. Data Security and Privacy Concerns

As you already know, cloud service providers implement the best security and industry certifications, but storing data on external service providers opens up risks. One prominent example is the Code Space company, where the AWS EC2 console was hacked.

3. Downtime and Reliability Issues

According to a report by Uptime Institute, 31% of businesses experienced financial impact because of downtime. In 2023, several companies and services faced the same issue, including Microsoft, Google Cloud, AWS, and more.

4. Vendor Lock-In Risks

This is a situation where the vendor cannot switch to another vendor. This situation comes due to high switching costs and vast amounts of data that are difficult to migrate.

5. Limited Customization and Control

While using cloud computing, you may be restricted from updating or personalizing a product or service. You may also face limited predefined options set by the providers.

Comparing the Advantages and Disadvantages of Cloud Computing

Let’s look into the advantages and disadvantages of cloud computing based on use cases, key matrices, cloud models, and more aspects for better clarity.

1. Use Case-Based Comparison

In this comparison, you’ll find industry-wise use cases that will help you better understand cloud computing according to your business needs.

2. Key Metrics Comparison

Go through this table of pros and cons according to the key metrics of cloud computing.

3. Comparison by Cloud Model

In this table, you’ll find a cloud model-based comparison, like the difference between IAAS, PAAS, and SAAS, to help you better understand cloud computing according to your business needs.

4. Weighted Decision Matrix

This quantitative technique helps you choose the service according to the set criteria for your business needs. However, this is a hypothetical result based on multiple resources.

5. Pros and Cons Across Cloud Providers

Significant advantages include cost efficiency, accessibility, recovery capabilities, and more. However, disadvantages you may face are vendor lock-in, fixed control over infrastructure, and more.

Factors to Consider Before Moving to the Cloud

You need to consider multiple factors before choosing the right cloud model and provider to get the business benefits of cloud computing.

Here is the list of factors:

• Evaluate the cost of ownership as providers like AWS, Azure, and GCP offer pricing based on resources needed. You can check the Azure consulting services or AWS cloud consulting services according to your business needs.
• Choose a cloud model that fits your business needs, like AWS, Azure, and GCP.
• Choose providers to comply with federal, state, and industry-specific standards like HIPAA, GDPR, and ISO.
• Check the tools & features that cloud service offers; for example, AWS offers over 200 features, and Azure provides 600+ features.
• You need to ensure that the cloud service provider offers cloud security governance.

Where To Start With Cloud Computing Integration?

The above article should have helped you understand all the advantages and disadvantages of cloud computing. However, one critical aspect of this process is integrating cloud computing and the nuances of expertise. Excellent Webworld is an experienced cloud application development company with industry expertise.

We have over 13 years of experience providing cloud computing development services. Our team of experts has successfully developed high-performance apps that integrate cloud computing technologies. With more than 900 successful projects, our experts have catered to different client needs in cloud computing.

We are a leading cloud application development company that offers end-to-end development. Contact us now to learn more about our solutions.

FAQs: Answers to Common Cloud Computing Concerns

Article By

Mayur Panchal

Mayur Panchal is the CTO of Excellent Webworld. With his skills and expertise, He stays updated with industry trends and utilizes his technical expertise to address problems faced by entrepreneurs and startup owners.