Finally! A Cloud Hosting Explanation in Simple Terms


At this point, it’s common knowledge that cloud hosting options for your business software are affordable, reliable, and fast.

Imagine: If the above words described a car, a computer, or even a pizza delivery option, you’d want to buy in… yet many business leaders are still strangely hesitant to make the switch when these words describe cloud hosting.

Perhaps you haven’t had time to learn about the cloud and you’re still unsure what the term really means. Perhaps you suspect that the low price tag of cloud hosting means that you won’t get a quality product. Or perhaps you simply haven’t had time to find the right hosting partner yet.

We’re not sure what the holdup is, but we are sure about this: 2018 is the year you should make a decision.

Whatever your hesitation, this introduction will answer some of your most pressing cloud questions, so you can make your cloud hosting decision confidently.

What Is the Cloud?

If you’re still unsure what the cloud is, don’t worry; you’re not the only one. There’s a lot of misinformation out there about cloud services and solutions, but here’s the real story: The cloud can be generally defined as software or databases securely stored within off-site servers that someone else manages for you.

If this sounds a lot like the Internet, you’ve pretty much figured it out. Though there are many technical differences that techie nerds split hairs about, you can think of “the cloud” as protected areas of the Internet – the ones that you can only access if you have a password and user ID.

Do you use mobile banking or web-based email like Gmail? Those services store your private information securely so that only you can get into them, but the software for them isn’t stored directly on your own personal computer. Those programs are stored on the cloud.

How Does the Cloud Work?

To clearly answer this question, let’s talk for a second about mobile banking.

When you log in to your online banking system using your super-secret username and password, you’ll have the ability to view all of your financial transactions, cancelled checks, etc. If you want to use that financial information in a spreadsheet or your Sage ERP, you’ll need to export the data from your online banking website.

This is critical: With “the cloud,” you can view your financial data online, but if you want to use your data, you’ll need to download that data to your computer. When you click “export” on your bank’s website, your financial transactions become a usable file that’s stored directly on your computer. That file takes up a small amount of space on your computer.

The above example is the key to understanding how the cloud works. It demonstrates how your data is fully accessible to you from the cloud, but isn’t actually stored on your computer unless you want it to be.

As we all know, a little data takes up a little space and a lot of data takes up a lot of space. In the past, you had to provide space for all your data—your ERP, your customer records in your CRM, your emails, your documents, your third-party integrations—by purchasing servers and computers with large amounts of memory. But that wasn’t all.

If you ran out of server space, you had to buy new servers and set them up, which was a hassle. If your server software became obsolete or your server itself failed, you’d have to buy a new server you could use to restore your backed up data. In addition to backing up your data meticulously, you also had to constantly update your server and security software, and you’d have to run regular system checks.

Sorry to tell you, but if your company is still spending time and money on server hardware, energy to electrify and cool that server hardware, and the building space to store the hardware, you’re wasting your business’s resources.

The cloud works by storing your software and/or data on at least one off-site server that someone else manages for you so you don’t have to stress about energy costs, hardware costs, or backups anymore. Pretty cool, huh?

Wait, Isn’t There Some Weird Terminology About “Private” and “Public” Cloud?

Just when you though you had this cloud thing all figured out…

People like options for their businesses, so the cloud offers a range of possibilities for data storage. In general, “the cloud” can be categorized under three basic headers:

  1. Public cloud

Public cloud is the most popular cloud option because it costs the least and requires little to no maintenance on your part. This type of option is called “public” because it stores your data on shared off-site servers in a highly secure way that keeps your data partitioned and secret from everyone else’s.

If you think of this like Gmail, it’ll make more sense. It’s not like your Gmail has its own server for your email. Your email doesn’t take up enough space to fill a whole server! Instead, your Gmail account and thousands of other Gmail accounts are all stored on the same server, but you can’t see anyone else’s Gmail and they can’t see yours.

  1. Private cloud

Sometimes regulatory compliance requires that you don’t use the public cloud to store your data. Many people mistakenly think this is due to security concerns with the shared servers of the public cloud, but the actual reason for these regulatory mandates is that regulated data tends to be mission critical and needs to be available at all times, with as few unexpected maintenance interruptions as possible.

While it’s not like the public cloud has endless service interruptions or anything, users of the public cloud do have to deal with short network outages every once in a while as their cloud vendors perform routine maintenance.

Have you ever seen a header on a web service informing you that their site will be down between the hours of 2:00 AM and 5:00 AM as they update their systems and they “apologize for the inconvenience”? That kind of unexpected and unavoidable service disruption could really mess up your business if you’re in a highly regulated, ‘round-the-clock industry such as healthcare.

With private cloud, your business chooses exactly when your routine maintenance will happen, which means you can plan for it. However, unless your company handles life and death situations on-site 24/7, you probably don’t need to sink money into the extra costs and IT requirements that the private cloud requires.

  1. Hybrid cloud

If some parts of your business are highly regulated but others aren’t, you can maintain compliance while reducing costs by choosing a hybrid cloud solution that provides public cloud servers for some processes and private cloud servers for other processes. While this may sound like a great “middle ground” to many businesses, we’d like to stress that a hybrid cloud setup is complex to manage and still creates more cost and hassle than a public cloud setup.

Our advice: Unless you’re mandated to use private cloud in your company, your best bet for simple, easy-to-use, highly secure, and low-cost cloud capabilities is going to be the public cloud.

What Is Cloud Hosting?

Now that you understand the basics of the cloud, the explanation about cloud hosting will be a breeze:

Cloud hosting is where you store the important business software that you own, such as your Sage ERP, on either a public, private, or hybrid cloud setup. Depending on the size of your business, this usually reduces your server hardware costs as well as your IT maintenance and labor costs.

The benefits to cloud hosting include:

  • No more server hardware costs
  • Lowered IT maintenance costs
  • Consistently secure, up-to-date server software
  • Eliminated energy costs for powering and cooling your servers
  • Automated backups
  • And more…

While all cloud vendors offer different additional benefits, ISM focuses on ensuring that your software is as hassle-free as possible, which means we also provide optional expert updates, upgrades, and patches for your Sage ERP, Sage CRM, Act!, and SalesLogix systems so that you’ll know your software is at its optimal working condition at all times.


Ready to learn more about your cloud hosting options through ISM? Check out the NellNube site (our cloud hosting service), or contact us at to find out more.