Deltek Analyst Derek Johnson reports.
Earlier this year, I wrote about the massive market opportunity for vendors leveraging cloud computing technologies. The potential for cost savings, scalability and storage alone is such that within 5-10 years, the cloud is likely to be a standard feature of most government IT infrastructures. In addition, the 2008 recession and the steady drip, drip, drip of layoffs in state and local government has provided the perfect justification for IT departments to secure future funding for technologies that are likely to yield savings over the next 10-20 years.
While cloud computing has been one of the chief beneficiaries of these trends, serious and deep-seeded concerns about security have and will most likely continue to blunt the overall potential for government contracting opportunities. Recent polling data from the public and private sector suggests that about half of all governments and businesses interested in implementing cloud technologies believe they do not meet industry security standards or that the risks outweigh the benefits.
It’s difficult to determine the precise effect such concerns had on cloud procurement, but a recent visit to the 2011 EDUCAUSE Conference in Philadelphia indicated these types of concerns are not isolated to the government sector and are just as widespread in the higher education market. The conference brought more than 4,000 officials from public and private universities to explore utilizing the latest advances in technology to transform and improve the educational experience. While cloud computing was the focus of more than a dozen panel sessions over the week, the topic of finding safe ways to use the cloud was a consistent undercurrent of many discussions. Several speaker presentations reflected a palpable sense of frustration with the current stalemate that exists between cloud vendors and their clientele – these frustrations were amplified by audience members during question and answer sessions.
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