Before we dive into what is cloud ?, let us peek into on Premise infrastructure model
On-Premise Infrastructure
In On-Premise infrastructure, the data center is owned and maintained by the Company within its property for its own private use. The software is installed on Company’s servers and behind its firewall.
Maintaining own data centers comes with the following overheads :
- purchase and install
a. compute — servers etc
b. storage — hard disk etc
c. networking — switches, routers, hubs - Limited scaling, purchase new machines to keep up with large processing workload
- requires high-speed network connectivity
- requires a reliable source of electricity
- Environmental factors
a. procure systems that maintain temperature and humidity remain within
hardware manufacturers’ specified ranges
b. should have reliable backup power systems
c. should not be near geographical flood zones - disaster recovery mechanisms should be put in place
- purchase and maintain fiber optic cables
- requires physical location security and monitoring systems
What is the cloud?
Cloud computing is the on-demand delivery of IT resources eg, servers, storage, databases, networking, software, etc over the internet with pay-as-you-go pricing. With the cloud, companies can avoid buying all the resources upfront
Companies offering these computing services are called cloud providers and typically charge for cloud computing services based on your usage. Similar to a taxi having a meter that keeps track of your travel distance. You then pay for that usage at an agreed-upon rate.
For eg, A food delivery company might use the cloud to host the website, store customer data in databases, send delivery updates using push notifications to customers, analytics to deliver a more personalized experience to customers.
Eg. Google Drive
Instead of saving files on the laptop or an external HDD, we can use cloud-based storage solutions like Google Drive so that we can access the files from anywhere around the world via the internet instead of carrying a laptop or an HDD with us.
Cloud Providers
- Amazon Web Services (AWS)
- Google Cloud
- Microsoft Azure
- IBM Cloud
- Alibaba Cloud
- Oracle Cloud
Bank Management: On-Premise vs Cloud
on Premise
Considering the banking system, an individual can store cash or other assets into the personal vault at a place he/she owns. So, in this case, we need to invest in purchasing vault, monitoring camera, and backup systems to keep the monitoring system running during a power outage. All the investment is upfront.
Cloud Provider
In this case, banks are the service provider. Banks will keep track of the transactions for an individual, storing money into the vault, guarding the bank location with the security and monitoring systems.
Bank additionally offers additional services like credit cards, net banking, ATM facilities, etc. that can be availed separately with different pricing based on the type of account at the bank.
The On-Premise approach comes with the following overhead
- Mechanism to handle disasters
- Real estate prices for owning multiple data centers
- The expense for maintaining hardware, electricity, heating, cooling, security, etc.
So cloud providers offload all these additional overhead from a company and allow a company to focus on data architecture, storage mechanism, offers attractive pricing models
During the sale season, the traffic to a website can spike exponentially and the system might overload. The cloud-based solution allows increasing the capacity to meet the business demand. Cloud computing provides great agility and scalability.
