Maybe the world isn't ready for cloud

Summary:Though the arguments for cloud adoption are often compelling, buyers are often too mired in old habits to move forward

I heard some utterly compelling arguments for adopting cloud computing at the recent Business Cloud Summit in London. The strides being made by the UK public sector through their use of cloud computing and applications make a seemingly irrefutable case for going cloud.

  • Liam Maxwell, Deputy CIO of the UK Government, cited a torrent of examples of how IT procurement had gone wrong in the past, such as a project that had that cost £55 million ($89m) yet only had 79 users, or a system where each transaction ended up costing £790 ($1280) to process. All of this adds up to the astonishing statistic that the UK spends one percent of the country's entire GDP just on government IT — "on pushing paper around in government," as he put it. It's a number so huge that several reporters have assumed he must have meant IT spending throughout the economy, but I've checked and this figure is the public sector proportion alone — in the region of £14 billion ($22.7bn) a year. Around £1.2bn ($2bn) alone is spent just on hosting.
  • Maxwell explained that the aim of the government's G-Cloud initiative was to dismantle the prior system of complex, lengthy procurement processes that effectively gave large suppliers a license to create these massively costly projects. Now that public sector buyers can browse the CloudStore to source pre-accredited cloud providers and services, there is competition among a much wider spectrum of suppliers. He gave the example of a project that had been quoted from a traditional supplier at £57 million ($92m). On being told that the same could be sourced from CloudStore at less than £1m ($1.6m), the supplier provided a new quote of £2m ($3.2m). "The cost savings we're able to identify at the moment are enormous. Those have come through CloudStore," he said.
  • Dominic Campbell from 20-person small business FutureGov (SME) described the impact of its Patchwork cloud app, which allows more frictionless co-ordination among different workers in multiple agencies involved in child protection in the county of Staffordshire. Putting the app on CloudStore overcomes procurement barriers, while using the cloud to connect care workers, teachers, police and other professionals allows them to share crucial information in a timely way.
  • Mark O'Neill from the Government Digital Service said that he used to manage 120 separate servers for a user base of 500, and yet for what he used to spend on each server he can now have thousands of servers available in the cloud. He went on to cite an example of secure hosting for a highly sensitive project being sourced from G-Cloud for one-tenth the cost of a traditionally sourced alternative.

Yet despite the cost, convenience and process improvements available by adopting CloudStore solutions, buyers are still resisting attempts to persuade them to use CloudStore. It's as though they feel the promised benefits are too good to be true, or that it's simply too easy and there must be a catch.

Denise McDonagh, Home Office director of IT, said that many public sector buyers were so used to the complex red tape of established practices that they find it hard to break out of them. Many simply assume that using CloudStore is somehow against the rules that apply to their own organisation. One buyer who had complained CloudStore was too difficult to use was found to be going through 47 separate steps imposed by internal procurement processes, most of which were irrelevant for CloudStore. McDonagh spoke directly to buyers in the audience, seeking to reassure them: "G-Cloud is legal, it's here, it's an open competition, therefore it's very, very competitive ... What can be commoditized should be bought from the cloud."

The problem is that the vast majority of people still seem to believe that cloud somehow isn't for them. Despite the growing maturity of cloud solutions and the backing they receive from thought leaders across government and industry, the world is not yet ready for cloud.

Meanwhile, even such well-meaning initiatives to speed take-up of cloud run the risk of getting derailed. Maxwell warned of the danger that the recently announced European policy on cloud could reintroduce barriers to competition: "We as a government have a strong disagreement with the EU cloud policy," he said. "We don't think recommending a single certification will work. It will drive government back into the arms of the big SIs."

One of the European Commission's lead policymakers on cloud, Ken Ducatel, was in the audience and later explained that, "We're just trying to make sense of what's going on. It's not our intention to impose certification schemes." But the committee set up to advise Digital Agenda Commissioner Neelie Kroes on a framework for public sector cloud procurement is dangerously skewed towards established big ICT suppliers, including Accenture, ATOS, SAP and Telefonica.

So even when the argument for cloud seems overwhelming, it may still fail to win ground against the reticence of cautious buyers and the inertia of established processes and power relationships. There is still a long road to travel before this battle has been won.

As a reminder of what we'd miss out on if cloud gets bogged down like this, I'll leave the last word to Mark O'Neill and his vision of what IT procurement could become:

"This is about fundamental business disruption. G-Cloud, the CloudStore, is starting to become, not just a store to provide IT services, not just about the technology stack, it's becoming more and more about meeting a particular user need. I'll be able to fulfil business needs with services from the CloudStore. That's a fundamental shift."

Topics: Cloud, EU, Government : UK

About

Since 1998, Phil Wainewright has been a thought leader in cloud computing as a blogger, analyst and consultant. He founded pioneering website ASPnews.com, and later Loosely Coupled, which covered enterprise adoption of web services and SOA. As CEO of strategic consulting group Procullux Ventures, he has developed an evaluation framework t... Full Bio

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