Cloud has achieved nearly total market penetration in Australia but maturity levels still have a way to go, according to researchers and executives at a media roundtable hosted by Oracle in Sydney this week.
“Most organisations of more than 20 employees, you’ll struggle to find any who didn’t have any sort of cloud in operation today,” according to Rodney Gedda, a senior analyst at Telsyte. Explaining that cloud has matured from “just point load to more mission critical workloads”.
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The “holy grail” at full maturity for cloud is infrastructure agility where large workloads can be moved to the cloud, according to Gedda.
While 30 per cent of organisations using cloud are approaching maturity the remaining 70 per cent “have a lot of work to do,” Gedda said. According to Telsyte, in Australia spending on cloud IaaS will surpass one billion dollars by 2020 and 99 per cent of enterprises will use cloud IaaS.
Organisations who do effectively leverage cloud can utilise technology and infrastructure that they wouldn’t otherwise be able to access, according to Rob Willis, regional managing director of Oracle Australia and New Zealand. This democratisation of technology access allows smaller organisations to compete with the bigger players he said.
“People get access to technology, that they couldn’t get access to any other way at a price point that is so different than building the whole thing yourself,” Willis said.
“We see a lot of customers who start out doing something small and they try something out. Sometimes those things are tremendously successful and sometimes they’re not as successful. But overall, on average it’s a very successful shift.” This is where the real value in cloud is and the main driver of uptake, Willis said.
One interesting aspect of cloud technology, apart from it prevalence, is its impact on an organisation. According to Oracle’s Willis I.T is now across most aspects of a business and their priorities have shifted. “If you talk to I.T people today, they’re not as concerned about servers, racking and stacking, storage and network boxes. That’s not their issue anymore. Their issue now is how do we do more with customers.”
Choice moves to the Cloud
This shift to customer experience was a significant factor in Choice Australia’s incorporation of Oracle’s cloud service. With no in house customer data, Choice made the jump straight to the cloud in a bid to improve customer insights and retention, while still keeping as many processes in house as possible.
“We wanted to be able to facilitate greater levels of personalisation,” said Michelle Rappaport, director of marketing and customer experience at Choice, who explained Choice’s incorporation of Oracle cloud technology to lunch guests.
The cloud technology will allow a better view of the customer and more accurate targeting, while still maintain privacy and security, Rappaport said. There were several cloud options available to Choice but Rappaport said “Oracle was the best overall fit”.
“One of the key concerns we had was the security of our data. Privacy was going to be very important to us and we liked that Oracle owned the whole stack. We don’t sell data. We don’t share data with anybody. It’s why security was a really important thing for us.”
Oracle has now shifted its focus from on premise technology to the cloud and is investing in more local data centres to service the local market. “That’s another big investment from our side,” Willis said. Oracle have seen impressive cloud revenue figures in Q2 2017.
When questioned on how Oracle could justify cloud revenue margins of 50 to 60 per cent Willis said most of that was being invested into research and development, and more cloud infrastructure. “All software companies have for a long time made high gross margins, which then gets turned around and invested back into R and D. What we spend on R and D is in the billions and billions of dollars. What we’re spending on cloud infrastructure; data centres, networks and storage, is again billions of dollars. The continued investment is huge.”