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3/5/2013
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U.K. Government, Nonprofit Agencies Tiptoe Into Cloud

IT firm Eduserv finds public and nonprofit organizations ready to roll out SaaS, but reluctant to deploy other cloud services.

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For all their differences in organizational size and mission, U.K. public sector CIOs and their equivalents in the country's nonprofit sector seem to have one thing in common: A growing acceptance of applications delivered over the cloud -- but not much appetite for anything beyond that as yet.

"We see definite appetite for line-of-business applications delivered as a service via the cloud," said Andrew Hawkins, sales director at Eduserv, a U.K. West Country IT firm. "This is especially true in local government, but some charities too, where [companies] like Huddle, Google and Microsoft with its Office 365 are starting to do well. But when it comes to IaaS [infrastructure-as-a-service] or PaaS [platform-as-a-service] -- that's definitely a more complicated picture."

Eduserv should be well placed to know. A spinoff of the University of Bath, a well-regarded science and tech institution, the 130-person strong company is one of those rare beasts: a nonprofit tech firm. That means, Hawkins said, that it concentrates less on profits and quarterly targets, instead plowing profits back into its own development and building long-term relationships with clients.

In one form or another it's been working with its big central government customer, the Department of Education, for 15 years, and with the Department for Business, Innovation and Skills for four years. Eduserv clients also include charities like the British Red Cross and Victim Support.

[ Want to learn more about the British government's cloud roadmap? See U.K. Government Cloud Ambitions Bigger Than Achievements, Critics Say. ]

The firm is moving -- along, perhaps, with its client base -- from a managed service approach to cloud. And it's seeing genuine hesitation in this large part of the U.K. information and communications technology (ICT) market for anything much beyond software-as-a-service (SaaS), cloud-wise. (Eduserv does other sorts of work as well, such as Web service development and professional services.)

"SaaS appeals because it's fairly easy to deploy as a discrete project, there's not usually much impact on other parts of the organizational infrastructure by this kind of cloud move, and the entry pathway is quite straightforward, really," Hawkins told InformationWeek.

But when it comes to anything in the IT stack beyond SaaS, things are less straightforward. Many public sector bodies and charities either have well-established managed service or outsourcing partnerships already in place, or have complex topologies with a lot of legacy IT. This means two things, he said, for CIOs in such organizations. One, they are unsure quite where to start unpicking their contracts to try and see where outsourcing some infrastructure could start to make sense, and two, they may not even be totally confident they know what they have in their IT shops.

"Every client is different, of course, and some charities that are newer don't have so much heritage to work with," he said. "But when it comes to a cloud move for infrastructure, we're seeing a lot of people taking that very cautiously. There's a lot more risk and more to prove when it comes to infrastructure in the cloud than software."

Hawkins pointed to what he dubs psychological factors too. "It's funny, but also true, that given a choice between your stuff in the room with you, versus it being elsewhere and backed by a 99.999% availability SLA, you still want it in the room somehow," he said. "It may take some time to change that point of view, which is understandable, I think."

Another, perhaps less forgivable, quirk of British public sector ICT buyers is their conviction that their tech needs are always unique and therefore demanding of gold-plated, bespoke treatment -- which inhibits appetite for anything commodity-flavored like cloud, he said.

However, Hawkins is adamant that this doesn't mean that British public sector or nonprofit organizations will venture no further than SaaS into the cloud. "I think it's just a matter of different adoption rates," he said. "The business case for outsourcing infrastructure is well known to these IT leaders and they see the value in moving to a service-level approach as way to minimize ICT costs, especially in the charity field. But it may take some parts of this market a bit longer than others to get there," he concluded.

Eduserv has just released a survey of 139 of U.K. public sector bodies that found 37% are currently using cloud applications, with adoption increasing steadily over the past five years. Cloud hosting was the second most popular cloud application, with 17% saying they use it, with cloud storage in third place, at 12.5%, across the U.K.

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