Government CIO on adding SaaS to public sector IT
An ambitious project to create a secure government cloud computing infrastructure is aiming to slash hundreds of millions of pounds from public sector's IT spend.
Cloud computing - applications and services which are hosted on and delivered from the internet, and accessed via a web browser - has been gaining a lot of attention of late as it holds the promise of lower up-front costs compared with on-premise products that IT teams must buy and support themselves.
While the private sector in particular has been leading the charge in using cloud services, including sales force management and CRM, the public sector is potentially ripe for major adoption of cloud too.
With a tendency among a vast number of public sector bodies to use similar applications - for example payroll, human resources management and enterprise resource planning - the potential savings from delivering such apps via the cloud rather than building and supporting hundreds of separate versions are clear - and play well with the downward pressure on Whitehall IT budgets.
It's against this background that the government has embarked on the G-Cloud project - part of a package of measures detailed in its Government ICT Strategy released yesterday - which could host applications and services for Westminster departments, more than 400 councils and other public sector bodies in the UK.
The first phase of design work on the G-Cloud will be completed in February and government CIO John Suffolk said the first public sector organisations will begin hosting some of their systems on a test version of the G-Cloud in 2010.
Suffolk told silicon.com the platform will need to be fully operational by 2013/14 to help realise the Treasury's Operational Efficiency Programme target of cutting £3.2bn from the public sector's annual £16bn IT spend.
"We have to deliver this 20 per cent saving by hook or by crook by 2013/14," Suffolk said.
"I think that it [the G-Cloud] is one of the levers. Whether we like it or not, there is an economic reality that begins to accelerate projects that drive out cost."
The G-Cloud will help to drive down cost by cutting the more than 10,000 software packages and services currently being used by public sector bodies. Rather than each having separate apps, the organisations will be able to choose from a shared range of applications held in the Government Application Store, to be hosted in the G-Cloud.
And with the public sector sharing more apps and moving away from running individual apps hosted in separate datacentres, the government will be able to cut its datacentre estate.
Westminster departments and the UK's 750 non-departmental public bodies currently rely on 130 datacentres to run their IT operations, a figure Suffolk estimates could be reduced to about 12.
"It is a different model: when you look at the cloud model you do not need 130 datacentres.
"The cloud is not a free service but say you are spending £1m in the old world, you would be spending say £750,000 in the new world," Suffolk said.
According to the government's newly published ICT strategy, the savings on IT infrastructure from datacentre consolidation could run into £300m per year.
Further efficiencies will come from the fact that fewer servers are typically sat idle when sharing apps on a cloud platform than when running them in separate datacentres.
"Even in the early modelling there is a substantial benefit when you ask how much would it save," Suffolk said.
As well as generating savings, the G-Cloud could one day become a profit centre for the government: according to the government CIO, the government is considering how much it could charge suppliers for hosting their software on the G-Cloud.
By giving vendors the chance to host their products on the G-Cloud, the government will also open itself up to the possibility of using more software from small and medium sized software suppliers, some of whom will be able to break into the public sector market for the first time by using the G-Cloud infrastructure...
And with the G-Cloud to remain a private cloud platform controlled by the UK government and available solely to public sector organisations, use of private sector cloud providers - such as software-as-a-service company Salesforce.com, and Google - is likely to be limited.
"I have had Benioff [Marc Benioff, CEO of Salesforce.com] and Google saying 'Put it all on our cloud' and I say 'Guys, I would need to look at every component and every supply chain to see is that stack secure'," Suffolk said.
"I cannot see how I could put my hand on my heart and say I know what is going on in the public cloud.
"It is hard enough to do when you own the damn thing, let alone when somebody else is running it.
"I think that the public cloud will be fantastic for some products but I would not put citizen data in the public cloud."
Suffolk acknowledges the challenge of delivering a robust and secure cloud system to support thousands of different organisations in a relatively short space of time and said negotiations are taking place with "100 different people" from the private sector on how to get it right.
"We are talking to as many people as we can, we are talking to Google, Salesforce.com, Amazon...lots of organisations and picking their brains on their experiences as we come up with the design," he said.
Suffolk predicted a falling away of the traditional systems integration market, echoing recent forecasts by author Nicholas Carr, as organisations replace their internal IT systems with systems hosted in the cloud.
"In 10 years' time systems integrators will have to say to themselves that the design, build and operate market is not going to be as big," he said.
"Every tech market in the world becomes niche and then commoditised, I do not see why enterprise class systems are going to be any different.
"I do not see why I would spend tens of millions of pounds on an ERP system going forward."
Suffolk predicts take-up of G-Cloud services in the public sector will begin with individual organisations and departments using one or two common back office apps on the G-Cloud and evolve into standardised applications being shared across similar organisations nationwide, such as different police forces or NHS trusts.
"There should be a police community and a health community, with standardisation within their worlds," he said.
"But there will never be a one-size-fits-all approach where health will be [using entirely] the same [apps] as crime."
The sharing of apps in the public sector will be made easier by a change in the way software is licensed for use by government organisations. Suffolk said the government is negotiating with major software suppliers to licence all applications to the Crown rather than individual organisations, which will allow the apps to be reused across the public sector without falling foul of licensing restrictions.