Cloud computing has been an industry buzzword for a number of years now with a great deal of hype around it, but in many respects there has been relatively little understanding of its specifics. It’s a very broad terminology, and as a result has meant a lot of things to a lot of people, depending on how that terminology has been unpacked and interpreted.

Local adoption of the so-called ‘journey to the cloud’ has been slow, with large organisations treading cautiously. But now, as local cloud computing becomes a reality, businesses across SA are coming to understand its potential benefits. Today, it is no longer an option for the JSE to support cloud computing – it is a strategic imperative.

The advantages of cloud technology are huge, particularly when it comes to costs and benefiting from economies of scale. Many clients will be aware of how expensive it is to try keep up with the speed of change in technology and IT infrastructure. As Moore’s Law suggests, if you buy a server today, in 18 months’ to two years’ time the technology will have moved on and there will be a new model on the market, offering up to double or in some cases triple the speed of the server you bought at a cheaper price point. From an organisational cost perspective, it’s impossible – or unaffordable – to keep up with that pace. The cloud changes that.

Traditionally, the JSE’s approach to technology has involved sunk costs and upfront capital expenditure, where we have derived all the benefits of that capex through technology that’s physically hosted within the JSE’s local data centres. Cloud technology is an attractive proposition in that it offers opportunities for cost savings and efficiencies in exactly this area. Rather than incurring the expenditure of a piece of equipment that we might only use during trading hours, the cloud now gives us the flexibility to turn it on and off as we use it, and to pay accordingly.

The question for many enterprises who are using cloud technology, is how best to take advantage of all the benefits that the technology offers. The three main categories of cloud computing are software as a service, platform as a service and infrastructure as a service. The latter, which is highly automated and where storage and networking capabilities are offered to clients on demand, is an attractive starting point on any company’s cloud journey.

There are also further benefits in terms of bandwidth and connectivity costs. Global providers Amazon and Microsoft both recently announced their intentions to establish data centres in the SA region, and this would certainly be a big step forward in terms of engaging with these providers at rand value.

From a regulatory perspective, these moves by Amazon and Microsoft also solve a number of challenges – particularly around data sovereignty and offshore data classification – that SA firms have been trying to get their heads around. In the past, whenever one has attempted to get legal opinions on these issues, the answer you’ve been given has depended on how you’ve phrased the question. Now, with the data centres based locally, those legal issues can finally be settled.

While the cloud opens up opportunities for JSE clients locally, it also provides potential benefits to international clients to connect to the JSE through local service providers who already have a presence in the JSE’s network meet-me-rooms. This essentially places them next door to the JSE from a proximity point of view, even though they are based offshore. Clients who use the JSE’s colocation service can transfer information quickly through cross-connections within the JSE’s data centre to their respective local cloud service providers. This is very attractive to both our local and international clients.

Cloud technology is changing the way we do business, and for the JSE the approach is clear: if you don’t make the journey into cloud technology, you will soon find yourself far behind in the race against competitors who are leveraging its benefits.

Robin Tucker
Head: Enterprise IT

Image: Athiyah Cader Fataar