Family First takes aim at the cloud

Beverley Head
Tuesday, 20 October 2009 16:10

IT Industry - Market

Senator Steve Fielding had better move fast with his Bill aimed at preventing the transfer of personal information overseas, because demand for cloud computing in Australia seems unstoppable with two out of five organisations planning a move to the cloud.

The leader of the Family First Party will next week introduce to Parliament the Keeping Jobs from Going Offshore (Protection of Personal Information) Bill 2009, which aims to limit what data can be sent offshore. For most of the large cloud computing suppliers which have their data centres overseas, the passage into law of such a Bill could spell disaster.

Such a move might also prove deeply unpopular with corporate Australia and Government departments alike. A new survey conducted by Telsyte has revealed that 40 per cent of Australian medium and large enterprises are likely to take up cloud computing in the next three years with the highest interest coming from healthcare, education, government, telecommunications and media sectors.

Industry analyst Gary Tsang, said this represented a higher demand than existed for hosted telephony (25 per cent in the next five years) or hosted unified communications (18 per cent in the next 5 years).

Tsang confirmed however that while organisations were keen to reap the financial benefits associated with cloud computing, CIOs harboured lingering fears about the security of their data, which would often be held in data centres overseas. “CIOs want to know where the data resides and where it moves to,” said Tsang, adding that security remained a major concern.

Ian Poole, CEO of IntegGroup (which like Telsyte, is owned by the UXC group) expressed surprise that demand for hosted communications services was so much lower than demand for cloud computing services. Integ offers a range of hosted communications services, including a newly launched conferencing and collaboration tool, but unlike many cloud computing specialists such as NetSuite or SalesForce.com, hosts its users’ data in Australia.

Tsang said that the most reluctant sector when it came to moving data offshore or into the cloud were the banks and financial institutions. He said that while there was some appetite for business process outsourcing, and IT process outsourcing, there was considerably less interest in knowledge process outsourcing.

And it may take a generational shift to change some of the more entrenched attitudes according to Tsang. “The older generation have a lot of reservations. But the younger generations are used to using G-mail, they store their photos online. You will get a wider acceptance with Generation Y.”

Baby-boomer Steve Fielding may still take some convincing.