You may already know that Xero is accounting and bookkeeping software that exists on the cloud. However you may not know what “the cloud” is and how Xero exists there. Here is an explanation of the cloud and how it relates to software such as Xero and the internet.
What is the Cloud?
When we talk about the cloud we are not talking about a floating mist of water high up in the sky. Instead, “the cloud” is a buzzword that refers to an infrastructure of servers and telecommunication equipment.
The servers exist all over the world. They house massive volumes of data and software applications like Xero, Gmail and Youtube.
We use devices such as our mobile phones, iPads and PCs to access the data and software stored on these servers. Our devices connect to the servers through telecommunication equipment such as phone lines and wifi. This telecommunication equipment is collectively called the internet.
Benefits of the Cloud
One of the main benefits of the cloud is that you can use better and more powerful equipment that you could use in your home or office.
For example, you may use a cloud storage provider such as Dropbox or GDrive. Your provider may offer some of free storage – say 30 gigabytes – or for a fee they may offer unlimited storage. To have the same capacity without a cloud storage provider, you would have to buy a hard drive or server and set it up in your home or office. You would have to maintain the equipment over time and also provide your own data backup solution. This could cost a lot more than cloud storage.
Additionally, cloud-based software such as Gmail or Xero is already set up for you. There is no need to install it on your local PC or server. Furthermore, cloud-based software is regularly updated for you as improvements are made. Finally, your data is backed up regularly and securely, saving you from having to manage your own backups.
Issues with the Cloud
The main issue with having your data and software stored on the cloud is accessibility. You must have a working internet connection to be able to access your data. Therefore, if you use cloud-based software such as Xero, it is a good idea to have a backup plan if your main internet connection fails.
Xero and the Cloud
Xero exists only in the cloud. You cannot install Xero on a device such as a PC or local server. It has been set up this way due to the benefits of cloud computing outlined above.
Also, Xero is compatible with other cloud-based services such as GSuite and many third party add-on application. When connected to Xero, these services enhance its capabilities and your user experience. Because of this, it makes sense for all of these services to exist in the cloud rather than on users’ local PCs or servers.