Cloud computing means using software, storage, and computing power that’s hosted on the internet instead of on a physical server or computer in your office. If you use Microsoft 365, Xero, or Google Workspace, you’re already using it. For most small to mid-sized businesses, cloud computing is the shift from owning and maintaining your own IT hardware to paying for what you need as a monthly service.
Cloud Computing in Plain English
You used to need a server in your office to store files, run your email, and host your business software. That server needed power, cooling, maintenance, and someone to fix it when it went wrong. Cloud computing replaces that model. Instead of running things on hardware you own, you access them over the internet from a data centre managed by someone else.
The “cloud” isn’t a single thing. It’s a term for any computing service delivered over the internet rather than from a local device. When you log into your email through a browser, save a document to OneDrive, or use an accounting package like Xero, you’re using cloud computing.
For Australian businesses, the shift has been significant. The Australian cloud computing market was valued at over $20 billion in 2025, and more than 87% of Australian infrastructure decision-makers now use at least one cloud service. It’s not new technology anymore; it’s how most businesses run.
The Three Main Types of Cloud Services
Cloud computing is usually broken into three categories. You don’t need to memorise the acronyms, but understanding the general idea helps when your IT provider or software vendor talks about what they’re offering.
SaaS (Software as a Service)
This is the one most businesses use without even realising it. SaaS means the software you use runs in the cloud, and you access it through a browser or an app. Microsoft 365, Xero, MYOB, Dropbox, Slack, and Zoom are all SaaS products. You don’t install them on a server. You log in, use them, and pay a monthly or annual subscription.
For most SMBs, SaaS is the entry point into cloud computing. Your email, file storage, accounting, CRM, and project management tools are probably all SaaS already.
IaaS (Infrastructure as a Service)
Instead of buying a physical server, you rent virtual computing resources (processing power, storage, networking) from a cloud provider like Microsoft Azure, Amazon Web Services (AWS), or Google Cloud. You get the infrastructure without the hardware.
This matters more for businesses that run custom software, need large-scale data storage, or have workloads that vary throughout the year. Your IT provider manages the configuration; the cloud provider manages the physical equipment.
PaaS (Platform as a Service)
PaaS provides a platform for developers to build and run applications without managing the underlying infrastructure. Unless your business builds custom software, PaaS is unlikely to come up in your day-to-day.
For most small to mid-sized businesses, the practical split is simpler: you’re using SaaS apps for everyday tools, and potentially IaaS to replace or supplement your on-premise servers.
What Cloud Computing Actually Looks Like for a Small Business
Here’s what a typical Australian SMB’s cloud setup might look like in practice:
Email and collaboration running on Microsoft 365 (Exchange Online, Teams, SharePoint, OneDrive). Accounting and payroll on Xero or MYOB. File storage on OneDrive or SharePoint instead of a local file server. Phone systems running on a cloud-based VoIP platform instead of a physical PBX in the office. Cloud backup replicating critical data to off-site Australian data centres. Line-of-business applications are either running as SaaS or hosted on cloud infrastructure.
Some businesses go fully cloud. Others keep certain systems on-premise (a local server for a legacy application, for example) and run everything else in the cloud. That hybrid model is common and perfectly reasonable. The right mix depends on what your business runs and how your team works.
Why Businesses Move to the Cloud
The reasons are mostly practical, not ideological.
- You stop buying servers: Instead of a $15,000 to $30,000 capital expense every few years for server hardware (plus maintenance, power, and cooling), you pay a predictable monthly fee. That shifts IT from a capital expense to an operating expense, which most accountants prefer.
- Your team can work from anywhere: Cloud-based tools are accessible from any device with an internet connection. For businesses with remote staff, multiple offices, or people who travel, that flexibility is hard to replicate with on-premise infrastructure alone.
- Scaling is simpler: If you hire 10 new people, you add 10 Microsoft 365 licences. You don’t need to buy a bigger server. If your storage needs grow, your cloud plan grows with you.
- Updates and security are handled for you: With SaaS, the vendor handles software updates, security patches, and uptime. With IaaS, your cloud provider handles the physical infrastructure and you (or your IT provider) handle the configuration and security layers on top.
- Disaster recovery improves: Data stored in the cloud is typically replicated across multiple data centres. If something happens to your office, your data and systems are still accessible. That’s a significant improvement over a single server sitting under a desk.
What to Consider Before Moving to the Cloud
Cloud computing isn’t automatically the right answer for everything. A few things to think about:
- Internet dependency: If your internet goes down, your access to cloud services goes with it. For businesses in areas with unreliable connectivity, a hybrid approach (keeping some critical systems local) can reduce that risk.
- Data sovereignty: Australian businesses should check where their cloud data is stored. For industries with compliance requirements (healthcare, legal, finance), data needs to stay in Australian data centres. Reputable providers like Microsoft Azure and AWS both have Australian regions, but it’s worth confirming rather than assuming.
- Migration complexity: Moving from on-premise to cloud isn’t always a weekend project. Email migrations, file server transitions, and application moves need to be planned and tested. A poorly handled migration can cause data loss or extended downtime. Getting it right usually means working with a managed IT provider who has done it before.
- Security is shared: The cloud provider secures the infrastructure. But securing your data, your accounts, and your users is still your responsibility (or your IT provider’s). That means multi-factor authentication, proper access controls, endpoint protection, and backup. Cloud doesn’t mean set-and-forget.
- Cost at scale: Cloud subscriptions are predictable, but they add up. A business with 50 users paying for Microsoft 365, cloud backup, and cloud-hosted applications needs to understand the ongoing monthly cost. For most SMBs, it’s still cheaper than maintaining on-premise infrastructure, but it’s worth modelling before committing.
Cloud Computing and Security
A common concern is whether the cloud is safe. The short answer: for most businesses, it’s safer than what they were doing before.
Major cloud providers invest more in security than any small or mid-sized business could on its own. Data centres have physical security, encryption at rest and in transit, redundancy across locations, and teams dedicated to threat detection.
But security gaps usually aren’t the cloud provider’s fault. They come from weak passwords, a lack of MFA, misconfigured permissions, and users clicking on phishing emails. That’s why cloud security needs to be part of a broader cybersecurity strategy that covers your people and your processes, not just the platform.
At CRT, our managed IT plans include Microsoft 365 setup and ongoing management, cloud migration, backup, and cybersecurity aligned with the Essential Eight framework. We support businesses across Brisbane, the Sunshine Coast, and remotely Australia-wide.
Frequently Asked Questions
Is cloud computing the same as cloud storage?
Cloud storage is one part of cloud computing. Services like OneDrive and Google Drive give you storage in the cloud. Cloud computing is the broader term that covers storage, software, processing power, and infrastructure delivered over the internet. Cloud storage is something you use. Cloud computing is the model that makes it possible.
Do I still need a server if I move to the cloud?
Not necessarily. Many businesses operate without any on-premises server. Email, file storage, backup, and most business applications can all run in the cloud. Some businesses keep a local server for a specific legacy application or for fast local access to large files, but it’s no longer a requirement for most SMBs.
Is the cloud secure for sensitive business data?
Major cloud providers use encryption, physical data centre security, redundancy, and constant monitoring. For most businesses, this is a higher level of protection than a server sitting in a back room. The weak points are usually on the business side: weak passwords, no MFA, or poor access controls. Security in the cloud is a shared responsibility between the provider, the business, and the IT team managing it.
How much does cloud computing cost for a small business?
It varies depending on what you’re using. Microsoft 365 Business Basic starts at around $9 per user per month. More full-featured plans with desktop apps and advanced security features run $30 to $50 per user per month. Cloud backup, hosting, and infrastructure are additional, depending on your needs. For a full picture, talk to your IT provider about what your current environment costs and what a cloud-equivalent would look like.
What happens to my data if I stop using a cloud service?
You typically have a period to export your data before the account is closed. The specifics depend on the provider and your agreement. Before signing up, check the provider’s data retention and export policies. And always maintain your own backup, because relying on a vendor’s retention policy as your backup strategy is a risk.
Can CRT help my business move to the cloud?
Yes. We handle cloud migrations end-to-end, including Microsoft 365 setup, file server transitions, and application moves. We also provide ongoing management and support once you’re there. Whether you’re starting from scratch or moving off an ageing server, we can walk you through the options and handle the transition. We work with businesses across Brisbane, the Sunshine Coast, and remotely across Australia.
Want to talk through what a move to the cloud would look like for your business? We’re happy to give you an assessment.
