By George O’Neill

You have most likely heard of cloud computing, one of the latest tech buzzwords. Although buzzwords come and go, when it comes to technology, often new advancements end up becoming part of the fabric of the way things get done in the future, and I believe cloud computing will be one of those. I predict three or four years from now it will not be newsworthy anymore since it will just be the way most small-to-medium sized businesses operate their information technology infrastructure. Real estate brokerages can lower costs associated with acquiring, operating and upgrading software needed to run their business and to help sales representatives be as productive as possible with the latest tools. Staying technologically current is always a challenge and cloud computing promises to help our brokerages do that.

Cloud computing encompasses the use and storage of files and applications accessible via the Internet. Nothing needs to be stored locally in your office, unless you wish to make a copy of your files. Storage occurs “in the cloud”, meaning somewhere on the Internet, at the facilities of those companies from which you get the software service. Where the storage actually occurs doesn’t really matter, except perhaps for the USA Patriot Act that gives the government south of our border the ability to read data stored within the USA upon demand.

What is most likely paramount to you is that data and applications are stored in a reliable, secure facility that gets regularly backed up so you never have to worry about not being able to retrieve your files. Access to data can be achieved anywhere there is an Internet connection, from any device, whether that is a desktop or laptop in the office, a tablet like an iPad in a coffee shop, or via a smartphone like a Blackberry wherever there is cell phone coverage or WiFi access. Total mobility and information access for you and your sales team is a key feature and you never have to worry about trying to remember to bring all your electronic files with you when away from your office.

Traditionally applications had to be purchased, installed and maintained on your own computers, and you had to ensure the appropriate levels of virtual security for login IDs and password management, and also physical security to ensure the data was, ideally, stored in a locked, water and fire protected room. Backup procedures had to be put in place and periodically tested to ensure they work. Whenever a software vendor released a new version of their application, it had to be purchased, installed and tested to ensure it did not interfere with other applications you were running. If problems were found, the application would have to be uninstalled and discussions would ensue with the vendor to obtain fixes. Existing data would have to be migrated to the new application so it could be made available to all users.

This was the norm for years, which was essentially the traditional mainframe computer model, the first generation of computing. Any company with significant requirements for computing resources would have had their own mainframe computer. Today only governments, universities and the largest companies still have mainframes. Most real estate brokerages didn’t have this generation of systems since the costs involved were too prohibitive.

The next evolution of software and computing included the ability to install applications on servers and have the applications automatically available to all computers on the same network. This was known as the client-server model of computing, which was very popular and still is in many companies since the cost of ownership is lower and applications can be written for PCs instead of large computers. Servers are often stored under desks (not recommended as the best location, but this is often the case) with data and applications on them. A twist on this arrangement is the PC centric model, where applications are installed individually on each PC in your office and users are responsible to manage their own files. This requires lots of technical support and the user files are most likely rarely, if ever, backed up. There are few economies of scale and often PCs and applications are just sitting there not being used, since software licenses cannot be shared.

Luckily today we have a much better choice with the ability to obtain and use software from online sources, on-demand, where the software is kept up to date by the vendor. Since applications are shared across the companies the vendor has signed up as customers, the cost to provide the service is also shared by those companies, making it cheaper for everyone. Often we pay a small monthly subscription fee, with no upfront purchase required. This approach can also be a timesaver since we do not have to manage resources to install and maintain the applications on our sites, and we have the flexibility to change the number of subscriptions to match the needs of our brokerages. The vendor looks after backups and often guarantees a high level of system availability.

This cloud computing model is quickly overtaking the other, older, more costly approaches. Also known as Software as a Service (SaaS), cloud computing applications and data storage are in some cases available for free. Examples of software “in the cloud” include Salesforce CRM, Google Apps, Facebook and YouTube.

Cloud computing is here to stay. You should seriously take a look since there are many advantages, not only from a business process point of view but also from a cost perspective.

George O’Neill is CEO and broker of record at O’Neill Real Estate Limited, a boutique full-service digital brokerage based in The Beach, Toronto. He is also the founder of remarkto, the largest Ontario marketing discussion group for real estate with meetings every two months to share information freely. See www.ONeillRealEstate.ca and www.remarkto.ca. Email [email protected]; Phone 416-946-1300.

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