The following comes from the TechSoup Canada Community Blog somewhere and was written by Anna Jaeger, Co-Director of TechSoup.org’s GreenTech Initiative. Many thanks to Chris Hilliar for sharing.

If you are a small to medium-sized nonprofit, why should you care about cloud computing? Because it can save you time, money, and help spare the environment.

What Is Cloud Computing?

Here is how the CyberOptic Group describes it:

Essentially, cloud computing enables computer software and hardware resources to be accessed over the Internet without the need to have any detailed or specific knowledge of the infrastructure used to deliver the resources, much like a utility model. You really don’t need to know what the phone company or electric company does on their end to enable calls and allow the lights to go on when you flip the switch; and, you really don’t want to know as long as when you plug into it, it works.

I bet many of you are using a form of cloud computing without knowing it. Current examples areGmail, Yahoo mail, Google Docs, Salesforce, and Microsoft Office Live Workspace. They are often called software as a service (SaaS). A company provides access to their software applications over the Internet and you access it through your web browser. If you are using email hosted by a company, like one of those mentioned above, you and your staff don’t have to manage an in-house email server like Exchange. You simply sign up for the accounts and all the back-end stuff is handled for you.There are other types of cloud computing other than software as a service. There is infrastructure as a service (IaaS), where you get the servers set up and hosted for you, but your team installs, configures and maintains the software applications. There is also platform as a service (PaaS), which essentially means a hosted application development environment for those who are building or customizing their own software.

I like the explanation of cloud computing at Zen and the Art of Nonprofit Technology.

What Are the Benefits of Working in the Cloud?

• Little to no upfront costs, but watch out for recurring operating costs.
  From Wikipedia: “Cloud computing users can avoid capital expenditure (CapEx) on hardware, software, and services when they pay a provider only for what they use. Consumption is usually billed on a utility (for example, resources consumed, like electricity) or subscription (for example an annual subscription to a newspaper) basis with little or no upfront cost.”
• No IT staff required: Ok, this might be an oversimplification, but many applications available in the cloud require much less in-house IT support because the hosting provider takes care of installs, upgrades, backups and standard maintenance for you.
• No servers need to be researched, purchased, maintained, or recycled.
• Rapid deployment: Often, accounts can be set up in minutes. More complicated pieces of software (CRM, accounting packages, donor management software) still require more set up and probably training of your staff.
• Convenience: Staff and volunteers can access your applications from almost any Internet connection with their login information. No more setting up VPNs or systems to allow remote access to your servers.

Green Benefits

• Fewer servers are built and running, meaning fewer toxic materials and water need to be used, fewer toxic materials are dumped, and less energy is consumed in the running of the servers.
• Client computers do not need to be as powerful since all the processing is performed on the hosted server(s). This means that you can keep your older computers longer and reduces demand for new computers, again saving on toxics and water.

Risks

• Loss of connectivity means loss of access to your software, infrastructure, and data. Also, if you have a slow or unreliable connection, cloud computing isn’t right for your mission-critical needs.
• Service levels: Make sure that the provider is reputable and provides an acceptable level of uptime and rapid response to issues.
• Regulatory Compliance: If you need to be HIPAA- or PCI-compliant or conform to other regulations, make sure your service provider is certified.
• Backups: Make sure you have copies of and access to your data, especially if your service should fail.
• Security: There are a variety of concerns about storing sensitive client data in the cloud due to privacy and security standards, that include not only regulatory compliance issues like those mentioned above, but also data security for phishing, spamming, and hacking concerns. The jury is still out on some of these issues, so for the time-being, we recommend caution when storing sensitive financial or personal information about your supporters and clients online.

A further discussion of definition, benefits and risks can be found in David Chou’s blog on the Microsoft’s Developer Network.

Conclusion

Small to medium-sized nonprofits who have limited capital, limited space, and limited technical staff can benefit financially and environmentally from using cloud computing. It saves energy, reduces the amount of hardware needed, and is often technically easier to install and maintain than in-house applications. Not every IT function should be migrated to “the cloud,” so you should discuss your situation with your IT staff or a consultant. The concept may be a bit scary for some, but once you get over that hurdle and realize that you are already using cloud computing, I think you will start seeing other ways you can use it to help your nonprofit get your work done efficiently.

Other Resources

Some of the major cloud computing service providers: Dell, VMware, Sun Microsystems, Rackspace US, Star UK, IBM, Amazon, Google, BMC, Salesforce, Microsoft, and Yahoo.

Holly Ross from the Nonprofit Technology Network (NTEN) on the potential of cloud computing: “In the cloud, we can share client service data with other organizations and map it against the need demonstrated by census data. In the cloud, we can create visualizations of our data that make those multi-colored spreadsheets finally make REAL sense.”

*Note from Pieter: Make sure you also visit TechSoup’s Cloud Computing Page for Non-Profits. It’s got loads of helpful info.