Magazine article Mortgage Banking

It's an Asp! It's a SaaS! It's a Utility! No, It's a Cloud

Magazine article Mortgage Banking

It's an Asp! It's a SaaS! It's a Utility! No, It's a Cloud

Article excerpt

I have to admit it. I have become very impatient with the bastardization of concepts that comes with popularization. So many terms commonly used by managers have a history and a deeper meaning than is known when they are batted about at corporate conference tables.

Think of paradigm, tipping (inflection) point, disruptive technology, strategy. And now cloud computing.

Sometime in their history, these concepts had profound and specific meanings. Casual and undisciplined use has obliterated their fundamental attributes and their original intent.

Between you and me, it's the misuse of the word "strategy" that irritates me the most. Let me leave this argument by saying that daily managing and strategy are not synonymous. Public relations firms, can you hear me?

Exploring the cloud

Today's column is about cloud computing generally, and cloud computing in the mortgage industry more specifically. To get to specifics, I first need to spend a little space fixing a definition of cloud computing. And then I'll outline specific vendor use of cloud computing in the mortgage industry.

It is important to know that cloud computing is a major departure from conventional information technology (IT) deployment. Users of cloud computing actually are outsourcing their computer functions. They rely on cloud providers for application development, technology deployment, scale of computing resources and maintenance.

Cloud computing is a specific model of Internet-based computing. With this model, users have a choice of computing platforms and applications, but they do not need to host the processing themselves.

Cloud computing ultimately promises to deliver all the functionality of lenders' existing information technology services ... and more. The first attraction to cloud computing is a dramatically reduced upfront cost of computing.

Mortgage bankers who implement cloud computing need not develop, implement, maintain nor go through the pain of upgrading technology. They can greatly reduce expenditures on hardware, software and IT maintenance services. These they receive from a service provider. In cloud computing, billing is based on usage--not unlike paying for electricity. Opting into cloud computing poses no major financial or human resource barriers to lenders, whether they are large or small

The major virtues of cloud computing are shared infrastructure costs, low management overhead and access to a broad spectrum of applications that enhance organizational capability.

Cloud computing is a model for enabling convenient, on-demand access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications and services). This functionality can be provisioned with a short lead time. Managing the switch requires minimal management effort when compared with in-house implementations.

Defining cloud computing

In the general scheme of things, there are MORTGAGE BANKING | DECEMBER 2011 five fundamental elements of cloud computing. There are three service models of cloud computing. To know cloud computing, we have to recognize the constituent components of this model of computing.

There are six essential characteristics of cloud computing:

* Lenders can access services when they want and without relying on vendor intervention;

* Information technology services can be accessed from almost anywhere through broad network access;

* All users of cloud computing access a common pool of computing resources--although proprietary data are segregated and secured;

* Lenders can continuously expand or contract their use of the cloud-computing services allocated to them, generally without a pricing penalty;

* The lenders' use of cloud services is metered and they are billed according to use; and

* Cloud computing uses farms of computer servers, components are redundant and the computing infrastructure is designed to be "always on. …

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