Cloud take-up rises fastest among small firms

Irish organisations are adopting cloud services at a steady pace, although the take-up among smaller firms has accelerated, a new survey shows.

The Microsoft/Amárach Cloud Index, which is due to be released in full tomorrow, moved up to 3.6 from 3.2 a year ago, as Irish businesses increased their implementation of such services.

"It's low still, but it's up from 3.2 last year," said Cathriona Hallahan, managing director of Microsoft Ireland.

“The area where we’re seeing the most improvement is in small business, which is probably quite understandable, because the new ways of accessing software through subscription model or through the cloud is giving lower cost options for small businesses.


"Instead of them having to make a big capital outlay, they're now being able to pay a lower cost by subscription."

Significant growth
The small business sector – firms with between five and 10 employees – has seen "significant growth", Ms Hallahan said, with the index rising from 2.4 last year to 3.8 this year.

Microsoft expects that to continue as businesses, small firms need to capitalise on the flexibility and efficiency brought by cloud services.

According to the index, some 54 per cent of IT decision-makers at firms with up to 50 employees said they had implemented cloud solutions in their organisation. That compares with only 37 per cent last year.

Almost two-thirds of those using the technology said their expectations had been met.

Irish companies are using the cloud mainly for email hosting, but there is also a strong adoption on office productivity services, Ms Hallahan said.

Microsoft, however, is focusing on the public sector in a bid to drive adoption of cloud.

"If Ireland wants to be a centre of excellence for cloud with all the data centres we have and the big players such as ourselves, Google, Facebook etc, then the Government has to start adopting cloud services and being a showcase for how a country can use cloud technologies. That's really the area we think needs faster investment."

Hurdles ahead
However, there are still hurdles to overcome to persuade some companies to take up the technology, particularly when it comes to the public sector and larger firms.

“It’s still a question around security and privacy. We need to make sure from a legislation perspective we have strong laws around data privacy and security. For large organisations, I think you’ll have some of the CIOs a bit reticent about handing out their work to somebody else.

“Today 80 per cent of the money spent on IT departments is spent on maintaining current infrastructure and current systems; only 20 per cent is spent on innovating new areas of business and adding value back to an organisation.

“Our view would be if you can add a lot of that maintenance to the cloud, you could shift to having 80 per cent of your department focused on value-added services to the organisation, and innovating of new applications and new lines of business.”

Microsoft is currently taking part in National Cloud Week, an event intended to raise awareness of the benefits of cloud technology. It kicked off the week with a €600,000 software donation to children’s charity Barnardos.

Ciara O'Brien

Ciara O'Brien

Ciara O'Brien is an Irish Times business and technology journalist