By Jennigay Coetzer

Companies can save as little as 10% to 15% and as much as 40% to 50% on their overall IT costs by moving their IT infrastructure to the cloud, including equipment and applications, depending on the circumstances. “The more IT infrastructure they move to the cloud, the more companies will save,” says Manoj Bhoola, country manager for enterprise service storage and networking for HP South Africa.

However, he says, cloud computing is not the answer for all companies or all IT systems.
It is therefore important to conduct an analysis of all the applications across the company and how they are used and calculate the savings that could be achieved by moving them to the cloud, before doing so.

During this analysis they would need to factor in the cost of the bandwidth required to access the cloud service. Companies should also carry out a security assessment to quantify the risks of running each application in the cloud.

“This will give them a good idea as to whether it is viable to move them to the cloud,” says Bhoola. He says retail applications that involve the processing of high volumes or transactions, such as airline bookings or train ticketing are ideal for moving to the cloud because they can be charged for on a per boarding pass or per ticket basis.

Similarly a network of ATMs can be run by a cloud service provider and charged for on a per transaction basis. In the fast moving goods sector retailers could move their back office systems to a service provider’s data centre to be processed and managed, leaving just the point of sale devices in the stores, and pay for the service on a per transaction basis.

There is also great potential for municipalities to pay for the use of a cloud service provider’s infrastructure on an on demand basis instead of replacing all their legacy systems, says Bhoola.

In this case a central government agency like South Africa’s State IT Agency (SITA) could be the cloud service provider, he says. “Municipalities are being faced with modernising their legacy systems, which are costing a fortune to maintain.”

Bhoola says HP is providing cloud infrastructure services to municipalities in the US. He says there is a major opportunity for infrastructure as a service in SA, because for most companies IT equipment accounts for the largest portion of their total IT costs.

Companies whose IT systems are used mainly for administrative and process purposes can gain quick benefits from moving their entire IT infrastructure to a cloud service provider, because these systems do not represent a competitive advantage.

In the future, IT resellers will offer packaged cloud services, which they will buy from suppliers, provide additional services on top such as security functionality, and sell them them on to customers, says Bhoola.

Jennigay Coetzer is a freelance writer and journalist with 30 years experience. She also runs media training and writing skills workshops, and is the author of A Perfect Press Release – or Not?, a guide to writing and distributing effective press releases, an electronic version of which can be downloaded free from her website: www.jennigay.co.za.

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