Data center application and services could be big winners in regards to UK government cuts with Whitehall moving closer towards shared services in its efforts to cut costs.
Public sector spending has been slashed in recent times across all government departments and tiers but ICT spending is expected to only see a minimal loss up until 2015 to 2016 while some data center services could actually grow, according to market intelligence firm Kable.
Government bodies are increasingly looking to invest in applications that can help consolidate its services – a move that could push cloud computing adoption by the government.
Kable research director Stephen Roberts warned, however, that the government is still expected to be cautious of moving too fast towards the cloud.
“There has been a change in the kind of applications that are needed by government and the way the UK government’s transformation agenda puts a lot more focus on applications that drive corporate services,” Roberts said.
“You also have the area of shared services, which has been a government mantra for years, despite hardly doing it. This is now something government is looking at and in many cases it is starting to happen. You have district councils sharing chief executives, and sharing unified services,” Roberts said.
The push to shared services is largely application led, according to Roberts, with governments focussing not so much on departmental areas but on business benefits.
“It means the choice of applications and infrastructure is about what is going to attract the largest number of users and keep the largest amount of people happy – the savings in this case come not from infrastructures but by having less people to run them.”
Kable figures show that the UK public sector ICT market is in a steady decline – the total spend of 2010 to 2011 is expected to be about £17.99bn, which could slip to £17.75bn in the next financial year with another mild decline predicted for 2012 to 2013 and a rise by 2015 to 2016 to £18.27bn.
“The cuts are affecting the spend on custom software, system integration and the associated consultancy and training services; but the effort to cut operational costs is helping to maintain, and in some cases increase, spending on outsourcing and managed services,” Kable said.
“There is also a widespread move to reform public services. They may be talked up as a radical departure from the course taken by the previous government but they are driven by the same underlying forces and in some cases follow a similar path.”
Roberts warned, however, that larger companies contractors had to work hard to get services up to the level where dedicated cloud service providers have positioned themselves.
“The question will be if the big guys such as HP can change the way they do infrastructure quickly enough to reasonably stack up against providers that are focussed solely on the cloud,2 Roberts said.
“My suspicion is they are likely to do ok – to reshape and catch up because of their expertise in applications and the rolling out of services to scale. These companies know how to engage with government – they just keen to keep them in place long enough to further develop their cloud expertise and competences,” Roberts said.
Government is not known as a fast adopter of IT, and it is likely to be no different with shared services and cloud computing, but this is likely to be where you will see increased spend, regardless, according to Roberts.
Most spending will be seen by central government, which is under the greatest pressure to cut costs and consolidate, especially when it comes to data center operations, while large departments will also see significant change. Defence, criminal justice and transport, on top of Whitehall, are expected to see the largest cuts to ICT spend.
"The overriding coalition priority is public service reform and the approach to suppliers has been tough but pragmatic,” Roberts said.
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Autor(en)/Author(s): Penny Jones
Quelle/Source: Datacenter Dynamics Foczs, 31.01.2011
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