Ian Jauncey examines how cloud computing is becoming a core component of not only internal IT strategy but of the wider corporate strategy for the offshore financial sector.
Looking Forward as Jersey Cele…
Undoubtedly, cloud computing is generating seismic shifts in IT services and the way they are procured and integrated into business. An IBM study of more than 3,000 global CIOs shows that 60 percent of organisations are ready to embrace cloud computing over the next five years as a means of growing their businesses and achieving competitive advantage. Significant innovations in virtualisation and networked computing, as well as improved access to high-speed internet, have accelerated this interest in cloud computing.
The offshore financial services sector has noted its particular importance in helping to safeguard data location and security. For those early adopters, cloud is fast becoming a core component of not only internal IT strategy, but of the wider corporate strategy.
Selecting the Right Service
Put simply, cloud computing is a general term for anything that involves delivering hosted services over the internet. There are various ways of deploying safe, secure cloud services. A cloud service has three distinct characteristics that differentiate it from traditional hosting. It is sold on demand, typically by the minute, hour or monthly; it is elastic - a user can have as much or as little of a service as they want at any given time; and the service is fully managed by the provider (the consumer can need nothing but a personal computer and internet access).
The ‘on-demand/elastic’ proposition is particularly attractive for many clients. This means that businesses can both access services with little or no capital expenditure and can take advantage of the agility that truly scalable services can provide. The sizeable investment in IT hardware, which requires internal management, is replaced by an on-demand, pay-as-you-go alternative.
In the UK financial services sector, approximately £14,000 is spent per employee, per year on the total cost of IT provision. Not only can cloud computing reduce costs, but it can also increase business agility, for example, providing the ability to bring a new product to market more quickly. It is also critical that many businesses operating online services, like those in the banking and gaming sectors, are up and running 24 hours a day, 365 days per annum. Cloud services, provided by the right services company, safeguards against downtime.
Core Service Elements of Cloud Computing
1.Software as a service
This type of cloud computing delivers applications through a browser to customers. This means there is no upfront investment in servers or software licensing for the customer but instead a predictable monthly fee.
Platform as a service
Platform-as-a-service in the cloud is defined as a set of software and product development tools hosted on the provider's infrastructure. Clients can build their own applications that run on the provider's infrastructure which are delivered to your users via the internet from the provider's servers. GoogleApps are examples of this service; these services are constrained by the vendor's design and capabilities, so one doesn’t have complete freedom, but one does receive predictability and pre-integration.
Infrastructure as a service
Infrastructure-as-a-service provide virtual servers to start, stop, access and configure. Cloud computing allows a company to pay for only as much capacity as is needed, and bring more capacity online as soon as it’s required. This ‘pay-for-what-you-use model’, resembles the way electricity, fuel and water are consumed.
MSP (managed service providers)
One of the most traditional forms of cloud computing, a managed service is basically an application extended to the IT function rather than to end-users. Other offerings include desktop management services, which can allow users to access software any time, any place. Included in this is the availability of downloading information direct to mobile devices such as Blackberrys and SmartPhones.
Risk management is of critical concern in the finance and banking industries, where more than 80 percent of CIOs said they are focusing their attention. Very strong security is critical to segregate different client environments as well as to ensure data remains offshore. As stipulated by the comprehensive legal and reputational risks of unintended disclosure, if a Channel Islands company wants to use the cloud, they must use a local host.
Cloud computing in the offshore jurisdictions remains at an early stage, with an array of providers, large and small, delivering differing degrees of cloud-based services, from full-blown applications to storage services to spam filtering.
It is essential however that businesses considering making a move to cloud-based services should demand a proven track record from their IT services partner in providing their clients with a holistic, all-encompassing service which offers not only highly available cloud services but the ability to provide additional value: backup monitoring, security provisions and 24/7 remote services support.