Dynamic Business

Five years ago, the online monolith that is Facebook was born as a modest networking website for American high school students.

Half a decade later, there are 500 million users worldwide. Eight million are Australian. It may come as a surprise to hear that six million of them are adults, and that the fastest growing group of users is over 55.

Facebook is the most spectacular example of what’s known as “cloud computing” – where software applications, storage and services are hosted remotely (“in the cloud”) rather than on a desktop PC.

Online email accounts such as Hotmail or Yahoo email have been in the cloud for years.

With the availability of fast reliable broadband, business software is now being hosted in the cloud.

It works quite simply: A customer buys software or storage on a per user basis without expensive, up-front licensing or ongoing management costs.

They use as much or as little space or software as they need and much of the computing work is done on a server located somewhere else, rather than on their own premises.

This is important for Australian small businesses, many of which are constantly on-the-go and often work away from their home base.

One industry analysis recently estimated Australian business is already spending about $A450m a year on cloud computing.

According to a recent report from analysts Gartner, the global market will be worth $A171 billion within four years.

That’s roughly equivalent to the total of Australia’s combined export earnings last year, only slightly less than the GDP of the Philippines or Romania[i] and about 13 times the current estimated value of Facebook.

Australia’s share in four years would be about $A1.8b.

So five years ago who would have thought this local charge towards the cloud would have been led, not  by corporate giants like Commonwealth Bank, Woolworths or Fosters but by an army of small businesses like hairdressers, mobile plumbing services and pizza shops?

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