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HK's financial services industry still cautious about cloud: F5 Networks

Nurdianah Md Nur | July 4, 2014
Regulations, cost of migration, and perceived insecurity are the main barriers to cloud adoption, said Charles Chong of F5 Networks.

Bounded by compliance and regulations, the financial services industry in Hong Kong has been slow to adopting new technologies such as the cloud, said Charles Chong, regional solution architect for Asia Pacific & Japan at F5 Networks. In an interview with Computerworld Singapore, Chong identified the other barriers to cloud adoption and talked about how the early adopters are using the cloud to enhance their agility and gain competitive advantage.

Computerworld Singapore (CWS) : The topic of cloud has been widely discussed since last year. Is it safe to say that the financial services industry in Asia and Hong Kong is becoming more receptive to it today?

Charles Chong (CC) : For the financial services industry, compliance and regulations offer huge hurdles for many companies that are looking to adopt cloud, especially in Hong Kong. Restrictions on data exchange and data privacy concerns have seen many financial institutions reluctant to move from their on-premise platform to public cloud infrastructure.

Instead, the shift towards cloud has been largely a private affair for many financial institutions. This shift to private clouds has been driven by FSI institutions seeking new ways to reduce costs, as governments increase minimum capital requirements and compliance costs increase. Using private clouds are helping many to achieve these, while dealing with dynamic business demands.

Big Data analysis, innovation, managing applications across multiple data centers and testing are other areas where financial institutions are looking at clouds for. However, they remain cautious due to regulations and current misconceptions about the insecurity of the Internet.

CWS: How are financial institutions in Hong Kong that have embraced the cloud using the technology?

CC: FSI's have been slow to cloud adoption, mainly due to strict regulations and compliance requirements. However, many banks do face significant cost hurdles as compliance and new regulations become more costly. To alleviate these pressures, many financial institutions have adopted clouds in five ways:

1. Enabling workload mobility
Workload mobility aims to provide banking IT with flexibility and agility that was previously not possible when constrained by specific hardware or storage platforms. By decoupling the workloads from the operating systems, storage layers and servers, IT teams in banks can now deploy those applications where they are needed-fast.

2. Rebalancing the return on equity equation
According to Gartner, poor return on equity will drive more than 60 percent of banks worldwide to process the majority of their transactions in the cloud[1]. Clouds can help to increase utilisation rate while reduce investment in on-premise equipment and software licenses.

3. Become more customer-centric
With competition soaring, big data analysis has become an effective tool to identify and maximise on new consumer behaviour trends as well as offer new services to current or future high net worth individuals. Building an on-premise infrastructure to house all these data can be costly, especially in the current economic climate. Increasingly, clouds are being used as platforms for big data analysis.

4. Driving innovation
Innovation is another area where clouds are taking off in FSI. Many financial institutions are looking to increase their competitiveness by offering new services and features quickly across multiple platforms. Clouds offer a robust and platform for services delivery. This has especially created a huge interest in cloud orchestration to manage applications across multiple data centers.

5. Test platform
Lastly, clouds offer the opportunity for financial institutions to quickly test and provision services that their employees and customers need. With development lifecycle shortening, demand for new services increasing and tolerance for half-baked software reducing, many are looking to use clouds as test beds.

 

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