Spain drags its feet on cloud computing

Spain is traditionally known as a country that does not like to take risks and likes to maintain the status quo, for this reason other new technologies such as 3-D televisions and the like have not caught on either. But, whereas 3-D TV is a service that is marketed as enhancing one’s viewing pleasure and therefore costs more, cloud computing is a new service that offers real-world savings financially.

Broadly speaking, cloud computing is the use of computer services that are primarily based on-line, with resources, software and information all stored on internet servers of a similar kind to those used by Web sites that feature web-applications that can be used as though they were already part of the computer. The basic concept is that the use of various resources on a computer becomes similar to the use of electricity, switched on when you want it and switched off when you don’t.

The cost savings are said to be significant, because one doesn’t need to pay for all the additional software needed on modern computers and the license fees and expertise needed for installing said software. For major businesses in the services sector, employing several hundred employees, the benefits financially are considerable. For the debt-laden government as well, this could be a major cost-saving project.

But, according to foreign IT analysts our conservative nature is holding our country back. We have a sizeable services sector, it accounts for 40% of Spanish jobs and over 50% of the country’s GDP, according to reports by Spain news media. This services sector, according to a report published by consultants from Accenture and the Bankinter Foundation of Innovation, is the best-suited to, as they say, “lead the migration to the cloud”.

‘The cloud’ despite its mythical and futuristic sounding name, is simply a metaphorical reference to the infrastructure of the Internet and is derived from the early drawings of a cloud that were used to illustrate the US’ national telephone grid and later the internet.

The services sector then is a major market for possible cloud computing technology and due to the absence of major capital expenditure requirements, the barriers to entry and reduced, yet just €198 million (US$260 million) in revenues were contributed to the Spanish economy through cloud computing and related services, revealing the very small size of the industry.

Proponents of cloud computing, such as the Bankinter Foundation, say that in a country like Spain where three million people are government employed, cloud computing can “help improve the efficiency of an administrative system that is very widely dispersed among state, regional and local bodies, by virtualising part of the services and moving them to the cloud” which would significantly improve efficiency and reduce the operational costs related to the staffing of many buildings and departments.

The government has adopted cloud computing only to very small degrees, with a few ministries testing cloud computing software provided by Terremark, a US-based IT company and according to their sales rep in Spain, Alberto Roman, they are close to making a decision on whether to roll out the technology to greater degrees as has been done in the UK and USA.

The government recently reaffirmed to Spain’s news media its commitment to reducing costs in all ways and its interest in cloud computing in this regard, but categorised the shift, which is intended to modernise public services, as a shift in culture rather than technology.

The banking sector has been even more cautious with the new technology, testing it to limited degrees, but only in low-risk functions. For BBVA and Bankiter for example, they have both tested it only in relation to internal email and office automation.  This is due to a number of factors, such as the highly-regulated nature of the European banking system, as well as the nature of banking business activities, which have already required specialised and highly customised computer systems to be developed for banks, somewhat reducing the feasibility of ‘the cloud’.