The adoption of cloud computing among organisations eager to streamline the way they procure IT resources for their end users is growing apace, according to experts.
Research firm Gartner estimates that companies worldwide will spend $112bn (£73bn) on software-as-a-service (SaaS), platform-as-a-service (PaaS) and infrastructure-as-a-service combined over the next five years, for example, as IT departments move to on-demand, pay-per-use models which they hope will offer a flexible combination of cost and scalability advantages.
By the end of this summer, government quango Remploy will see all its applications remodelled as subscription-based or pay-as-you-go, on-demand cloud-based services hosted by systems integrator 2e2. These include enterprise resource planning, supply chain management, case management, back-office and finance applications, serving about 3,000 disabled employees in 34 recruitment offices and 54 factories across the UK.
The five-year contract will cost a sizeable £5m, though Remploy IT director Chris Jones did not make a price comparison compared with on-premise application provision because the organisation’s in-house IT infrastructure was not up to the job of supporting the planned service expansion. Rather than cost reduction, the attraction of cloud-based applications for Remploy revolved more around flexibility and ease of management.
“We want to go to a model where there is a full subscription per user, but that does not make sense in every case,” says Jones. “Everything is virtualised so it can scale and we pay for virtual capacity as we use it – we start paying for a virtual server when it is created and stop paying for it when it is brought down. That way we can add things when we need them.”
Before the migration, about 50 to 60 per cent of the Remploy IT department’s role was “pressing buttons and looking after hardware” but staff are now freed up to take on other roles and other third-party IT contractors have been dropped.
Like other organisations, Jones concedes that not every IT service or application can be successfully moved to the cloud – some have to stay in-house.
“At the other extreme we have a legacy BARN application running on Unix kit which will have to sit in a corner,” he says.
The cost benefits of using public clouds are often more acute for smaller companies such as the Sinclair Scott accountancy practice in Ayr, which recently moved all its applications to a hosted environment jointly provided by IRIS Practice Hosting and managed service provider CI-Net.
Since December last year, the IRIS accountancy practice software, together with Microsoft Office and Outlook, has been delivered to the firm’s 20 staff and partners as on-demand applications to desktop and laptop PCs, and in the future iPads as well, for which it pays a monthly, per-user fee.
“Our older server was starting to play up and we kept delaying a replacement. Vendors were talking about things we did not understand such as virtualisation and mirrored disks, and it all seemed complicated and expensive,” says partner Andrew Sinclair.
“We thought cloud computing was the way to go, especially for guys such as me who do not really understand IT, but know what the organisation wants [in terms of IT provision]”.
Initial performance problems were put down to broadband issues, but after dealing with IRIS for the past 10 years, Sinclair was happy to put his trust in the company to sort out any issues with hosted application delivery that may arise.
“The application was running slowly initially, but the speed was good and connection issues were the main problem,” says Sinclair. “Hopefully that is behind us.”
Any similar broadband problems in the future should be circumnavigated by the addition of a second connection, and load-balancing software that determines the optimum data path to use, he added.
Sinclair Scott finds it costs the same to lease hosted applications as it did to own them, highlighting the importance of not having to worry about IT provision in-house as the most important benefit of cloud provision.
“The main reason is not really the cost saving on IT support, rather the management time taken up with dealing with these matters,” says Sinclair. “IRIS says it does not make a lot of money out of it because it has to buy a licence from Microsoft and run the servers.”
While Remploy and Sinclair Scott are sourcing their IT from public cloud service providers, Indian IT services company WiPro recently implemented a shared private cloud environment to streamline the delivery of virtual machines and applications to its employees across the globe.