10 Ways the Cloud Has Changed New Business

One bright spot that has persisted amidst our current troubled global economy is growth of Internet services. And fortunately, it seems as though there are still great growth opportunities online; as global Internet penetration rate is still just barely above 30%, we clearly have a long way to go in this trend. What’s going to be the key technology that drives us there?

The Cloud.

Specifically, here are 10 ways the cloud has changed the way business is done:

1. Push Prices Down

At its core, the cloud is a cost-saving technology: it enables data to be more easily shared, which in turn allows resources to be allocated more efficiently (companies like AirBnb or GetAround are examples of services that use cloud technologies to push prices down and improve allocation of assets). Most notably, a study conducted by the London School of Economics concluded that cloud computing makes it easier and cheaper to innovate. Cost reduction enables many other transformations, such as…

2. Greater Entrepreneurship

Just as clouds have enabled businesses to dramatically lower their cost of operations, they have by extension lowered the cost of starting a business — and thus spurred entrepreneurship. And thanks to cloud technologies and the degree of data sharing they enable, independent businesses can share their collective infrastructure costs via the cloud. Rackspace, is using our cloud technology to promote entrepreneurship via their Startup Program.

3. Small Business Partnerships

Of course, the cloud doesn’t just dramatically reduce the costs of starting a business — it also reduces the cost and difficulty of partnering with other businesses by making it easier to use APIs of other applications. Caterina Fake, co-founder of Flickr, has said that APIs enable a new form of business development for small businesses that makes meaningful collaboration more possible for all organizations, big and small.

4. Build a Modular Organization

Running parallel to the idea that cloud technologies facilitate small business partnerships is that they enable larger companies to create a modular organization. Prabhakar Gopalan notes that this is a manifestation of Conway’s Law, in that modular communication systems built on cloud technologies will ultimately yield modular organizations as well. Basically, cloud technology enables better participation across small teams — which in turn enables organizations to be less hierarchical and more modular, which reduces the organization’s risk against collapse of any single department of its unit.

5. Reduce Technical Barriers

Consistent with the basic theme that cloud technologies enable sharing is that they also, by extension, enable collaboration and specialization. As such, cloud technologies enable non-technical individuals to participate in and lead information systems. This is especially a focus of ours at Rackspace, and hence why we made our mission to bring fanatical support to the cloud technologies that we provide.

6. Facilitate International Business

To put it simply, the cloud makes it easier to share data. This makes it easier for the same data to get to computers all over the world faster than ever before, which in turn makes international business easier. Take for example, Rackspace Cloud Files and it’s built-in CDN using the Akamai technology. End users can access your web content faster by retrieving data cached content from servers closest to them, rather than from the origin.

7. Work on All Computing Devices

Thanks to the cloud, businesses can more easily reach their customer regardless of what computing device they are using. Clouds enable an organization ‘s offerings to be re-packaged and customized via APIs by independent third parties with their own audience, and for an organization’s own workforce to collaborate more easily regardless of how they are connecting to the Internet. And so we organizations are transforming into …

8. Mobile Workforces

Because the cloud enables greater collaboration on any computing device from anywhere in the world, it is leading us to a world characterized by a mobile workforce: business travel for building deeper bonds based on the loose bonds created by cloud-based collaboration is becoming more common.

9. Always On

And so, because the cloud enables a workforce that is international, mobile, and accessible, it is always “on.” (Although the Cloud never sleeps, every provider has their own SLA).

10. The Learning Organization

The cloud is also enabling organizations to transform themselves into learning centers that create a workforce more educated and informed than ever before.

“The most significant benefits of cloud-based learning are that it enables accessibility from multiple devices (e.g., computer, tablet, smart phone) and allows for both formal and informal learning with a wide network of individuals, one that is not limited to a specific institution,” writes Marci Paino of Clomedia.


The cloud enables greater productivity and efficiency than ever before. That’s how it’s become an essential technology that’s transformed our world.


Simit Patel is a trader, writer, and technology entrepreneur. Simit blogs via Contently.com.  This is a guest post and the opinions of the author may not reflect those of Rackspace.

Rack Blogger is our catchall blog byline, subbed in when a Racker author moves on, or used when we publish a guest post. You can email Rack Blogger at blog@rackspace.com.


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