According to PricewaterhouseCoopers survey which was reported by Americanbank.com, there’s a significant interest in the private cloud shown by financial sector. According to the survey 71 percent of financial service executives are planning to dedicate a sizable portion of their budget to invest in cloud computing this year. This would mark an increase of 18 percent from 2012. Another 50 percent are also planning to invest in private cloud infrastructure which includes facilities like virtualized storage and network equipment.
The reason behind this influx of investment is the provision of greater security and overall reliability of cloud environment put forward by cloud vendors. The data is secured by encrypting it while at rest and in transit, the architecture of the enterprise cloud is impregnable and is ideal to house confidential data and business critical applications. These applications are crucial to the overall existence of a financial company. Majority of firms outsourcing their IT infrastructure cited that data security posed the biggest threat to their organization.
Three primary reasons were cited by financial heads for deciding to place their crucial data on an external private cloud:
1) Having superior technical skills at their disposal to cope with new requirements
2) Speedy delivery of IT solutions for business needs
3) Reduction in overall expenses incurred through IT department
Why use a Private Cloud Service Provider?
With an outsourced private cloud service provider, the investment is acquiring talented individuals, critical infrastructure and latest tech to construct enterprise class fast performing clouds. The financial industry largely differs from the IT sector – by outsourcing their IT department, a financial company will have a freehand to concentrate on their business need instead of worrying about complexities of operating a data center.
Similarly, the boon of private cloud is that an outsourced IT vendor would be able to speedily comply with requests of deploying new servers whenever the industry demands more support. Outsourcing to a private cloud under the laaS is a very feasible and viable option as it negates the construction of a data center. The cost that is saved from upfront capital investment required for a data center can then be used to broaden business horizons. IaaS also curtail expenses of hiring certified IT staff with latest technical knowledge.
Earlier this year, an analysis report from Gartner stated that cloud information as a service (IaaS) spending is expected to grow by leaps and bounds and swell to an unprecedented $72 billion mark. The compound annual growth rate (CAGR) predicted for this massive investment influx is 42 percent. In stark comparison to other existing cloud services and market staples which include: platform as a service (PaaS), business as a process (BPaaS) and the most commonly availed software as a service (SaaS), IaaS is the most rapidly expanding and fast growing segment.
After the Snowden debacle which portrayed cloud computing in a negative light (not due to any inherent cloud computing flaw) it’s heartening to witness a significant investment in the cloud by financial sector.