Major cloud service providers unwilling to vary terms and conditions, claims BDO IT director

BDO won't move more services to the cloud until it is satisfied with the Ts and Cs, says IT director John Turner

The big cloud service providers will not change or adapt their contractual terms and conditions, leaving end users having to resort to smaller providers and be even more cautious about moving to cloud services, according to the IT director of accountancy firm BDO UK, John Turner.

Turner was speaking to Computing on the back of a report that found that the vast majority of companies in the UK (87 per cent) have encountered some form of unplanned cloud spend, with each organisation forking out an additional £270,000 over the past five years on unforeseen costs.

Turner was surprised by the amount of companies who had encountered unplanned cloud spend, but said that the report's findings chimed with some of BDO's own findings on cloud services.

It is for this reason that BDO has taken a conservative approach to cloud computing, he said.

"Up until now we've only used software-as-a-service (SaaS) from cloud vendors. So when we look to put a new solution or service out at BDO, one of the first things we're deciding is whether we are going to do it on-premise or use a cloud service, and up until now we have put a number of tier two apps on SaaS, but haven't actually jumped into the cloud as many other businesses have," he said.

These 'tier two' applications included its HR learning modules, expenses, purchase-to-pay system and a flexible benefits solution. Turner declined to disclose exactly which products BDO had selected, though. He added that BDO doesn't term these applications as tier one because in the event of a disaster, the company wouldn't necessarily have to recover them straight away.

"But because these tier two applications are in the cloud with SaaS, we would be able to recover them - that is one of the benefits we see from cloud computing in multi-tenancy, having the data in a number of locations in the UK or within Europe," he said.

Despite this, Turner believes that there are many drawbacks to cloud, including hidden costs. But this doesn't mean that BDO will not use cloud services in the future. Turner said that it will be using more cloud services, although he emphasised that the company would prefer to take a hybrid approach.

"I think there will always be data that we want to keep on-premise, and when we say on-premise it will be with [data centre and hosting provider] Sungard, but it will be within our control. I think moving forward we will put more and more data and services in the cloud," he said.

But this will only happen when BDO is satisfied it has the right contractual terms with vendors, and understands what the vendor's responsibilities are so that it doesn't get caught out in terms of unforeseen expenses, firmware upgrades or integrations.

"I want to understand the risks upfront, and we won't move forward until we do," Turner said. He added that cloud computing terms and conditions are similar to the difficulties companies face with software licensing.

"This is no difference. We use a legal firm and independent procurement consultants to help us go through these contracts and make the terms and conditions as clear as possible," he said.

"The issue I find when we are dealing with a really big IT organisation is that they will not vary their terms and conditions because they are so massive, and therefore BDO is a small fish in a very big pond. That's why we like to work with the likes of Sungard, who listen to our clients and what they want, and are therefore willing to vary their contractual terms," he added.