Water company reluctant to tap into the cloud

United Utilities IT chief says core apps are better kept inhouse, although cloud does have its uses

United Utilities owns all its core applications despite a very tight IT budget

United Utilities (UU) has said it will not put its core applications in the cloud despite having to run its technology on a very tight budget.

The water company’s five-year budget of £3.6bn was established by industry regulator Ofwat in November and agreed by UU last month, with IT spend for the period set at £125m, which is tiny in comparison to, for example, Network Rail’s five-year IT budget of £1bn.

Even though resources are limited, the company said it would rather own its IT assets than use cloud-based alternatives, and it recently decided to roll out a new version of Microsoft Exchange.

“Putting aside any financial advantages associated with owning assets in a regulated environment, other benefits of asset ownership include control, security and support for niche applications,” said Kevin Power, UU’s chief technology officer.

Despite his unwillingness to put core applications in the cloud, Power said that the technology is suitable for other areas of IT.

“Cloud-based tools help us collaborate with partners during the design, build and operation of water and wastewater assets – it is also easy to trial cloud services prior to any potential investment,” he told Computing.

“And even when new business functions are built into our IT strategy, we may not be able to deliver them as quickly as the business requires owing to other priorities, and using cloud services on an interim basis has been helpful,” Power added.

Research director at MWD Advisors, Neil Ward-Dutton, said, “Not many people would say that the cloud is suitable for everything. It is all about taking applications that are peripheral, such as collaboration and analytics tools, and giving the technology a go.”

“I wouldn’t advise anyone to take a wholesale approach to cloud computing now – at least not for the next three to five years,” he added.