Serverless cloud computing handles virtually all the systems operations needed to make it easier for developers to use the cloud for their application needs. It provides an interface that greatly simplifies cloud programming, and represents an evolution that parallels the transition from assembly language to high-level programming languages. During the past few years, serverless computing has grown from being a promising business idea to one of the fastest growing sectors which is going to dramatically reshape business landscape.
How Serverless Computing Is Reshaping Businesses?
Serverless computing enables companies to build and run applications and services without thinking about servers. The serverless approach is applicable to many types of applications, and for all sizes and maturity of organizations, from startups to large enterprises. With serverless compute services such as AWS Lambda, Google Cloud Functions, Zoho Catalyst, Azure Functions, provisioning, scaling, and management of servers are handled by the respective cloud service providers. Building serverless applications means that developers can focus on their app’s core business logic instead of worrying about managing and operating servers or runtimes. This reduced overhead lets developers reclaim time and energy that can be better spent on developing innovative, scalable and reliable products. It also allows for the ability to achieve massive scale with minimal human capital, making developers and companies alike more agile in today’s fast-moving economy.
In addition to accelerating innovation, serverless approaches offer a second advantage that’s particularly critical for startups and SMBs at large: lower costs. Compute power is often a key element of the small business cost structures. Usually, consumer-oriented businesses (B2C) often run services that are used by hundreds to millions of users 24/7 and need to optimize their cloud costs. Business-to-business companies (B2B) often require APIs and cross-company services with tight service-level agreements (SLAs), requiring the cloud service provider to deliver on their own SLA. Business-to-employee services and apps strive to make employees productive with real-time information and processing capabilities. Serverless computing allows organizations to develop and deploy applications meeting the needs across all the above categories.
In delivering these experiences, small businesses struggle with a common problem: They want to “get off on the right foot” with customers by providing a reliable service that scales effectively, while simultaneously being cost-conscious and using their limited resources wisely. Serverless computing like AWS Lambda or Zoho Catalyst enables small businesses and startups to achieve these two seemingly opposing goals more easily. At the heart of serverless computing is a simple but revolutionary idea – that companies only pay for compute when they actually use it. The pricing model of Serverless computing has disrupted the economics of application infrastructure because it made computation proportional to the workload than based on the sizing of the underlying infrastructure. If an application or service has little or no workload (for example, in the middle of the night), there are no charges. If there’s a sudden spike, such as a flash sale, Serverless compute will instantly scale to accommodate the massive load. If the computational task is lightweight requiring shorter execution time, it costs less. If the execution of code takes times, it costs more. With such fine grained pricing, the compute usage is always exactly aligned to customer and workload needs, never higher (which would result in low utilization and wasted money) or lower (which would result in low availability and poor end user experiences). Compared to server-based architectures, Lambda’s pay-per-use model can reduce cost of goods sold (COGs) and lead to more competitive margins. It makes it easy for companies to assign costs on a per-customer, per-use basis. Serverless architectures double down on the cloud-enabled software-as-a-service (SaaS) business model by providing recurring revenue and higher gross margins even for companies not yet operating at scale, enabling new models of selling and consuming services.
SMB or Enterprise?
There is a quite a bit of confusion in the industry about whether Serverless compute services are more suitable for enterprises or SMBs. This is an unnecessary confusion and the technology is well suited to meet the needs of both sectors. While enterprises realize their value from the agility offered by Serverless, SMBs can gain from both the agility and cost perspective. In fact, these technologies make it easy for SMBs to build applications taking advantage of the proprietary data they have as many SaaS offerings cannot meet their specific needs. This puts SMBs on equal footing with enterprises when it comes to gaining insights from their own data. While Serverless might be part of the larger application deployment toolkit for enterprises, SMBs can use these technologies as their only infrastructure for their custom applications. Whether you are a small business or a large organization, you can leverage Serverless compute and benefit from it.