It's All About the Benjamins

Anthony Malakian, deputy editor, Buy-Side Technology

This morning I was reading about a recent Vanson Bourne survey, sponsored by SunGard, which found that of 100 UK-based CIOs, the vast majority felt that cloud was "over-hyped"—that it's simply the next evolution of technology.

Fair enough, but based on what the CIOs I've spoken with have told me, I don't think it's such a cut-and-dried issue as drilling it down to a hype game. The true "hype" comes from somewhere else, in my opinion. (More on that in a minute.)

What I did find most interesting is that while about three-quarters of respondents were most concerned about the security of the cloud—and I don't doubt at all that this is a major concern—fewer than half were worried about pricing.

It is not clear whether this means that the pricing is so good that they aren’t much concerned about it, or that pricing doesn't play a major role in the decision to switch over to a cloud-based solution.

If it's the latter, then I'm calling shenanigans. (I'm still waiting for my copy of the report.)

Earlier this year I spoke with Alan Goldstein, the CIO of BNY Mellon Asset Management, based in London. He told me that from a vendor/software licensing standpoint, the vendor community was still a bit immature. Since it's a relatively new space—or at least a new evolution—the pricing will take time to evolve, as well.

That, to me, makes sense. But to simply say that price is so much less important than security ... well, I'm not buying that.

Cloud makes sense because the cost savings make sense. All these concerns about security—and remember, here, we're talking about private internal or hosted clouds, not public clouds—are what's over-hyped.

Simon Hazlitt, cofounder of London-based Majedie Asset Management, a firm that doesn't have a shred of internal IT as it outsources all of its technology to cloud vendors, made this point very clear at BST's European Summit last week.

While many in the audience were skeptical, Hazlitt said that over the course of nearly a decade he can count the number of outages Majedie has experienced on one hand, and he doesn't even need a single digit to describe the number of information leakages his firm has experienced. The reason Majedie turned to the cloud is for cost savings.

IT is all about doing something better and faster, all while keeping the costs down and making the board happy. It's truly a thankless job.

To reiterate, security is important. But it's in security where I believe the hype to be. The bottom line will always be the bottom line: price.

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