SME to Increase Cloud Spend

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Almost half (48%) of UK SMEs are set to increase their spending on cloud computing services over the next twelve months according to the results of GE Capital’s annual Capex Barometer. Two thirds of SMEs already use cloud services to some degree with more than one in ten (14%) using it for more than 25% of their total IT requirements.

The findings echo a report earlier this year from market intelligence firm IDC, which predicted that the EMEA market for cloud infrastructure will reach almost two fifths (39%) of total expenditure by 2019[1].

Gabriele D’Uva, UK Managing Director, Equipment Finance at GE Capital, commented:
“As we enter the era of the ‘industrial internet’, the key drivers of technological change and user behaviour are coming together to accelerate change.

“On an industrial level, key business services such as telephony and big data, which once required high levels of investment in hardware and software equipment, are now moving into the cloud space; all you need is a handset and an internet service. Meanwhile, a new generation of workers are transferring their experience of using cloud computing in their personal lives to the business world, creating increased demand.

“The barriers to accessing cloud computing are also lowering. In the UK, there has been a real drive in national infrastructure investment, particularly in broadband speeds, which is accelerating the performance and take-up of cloud.

“As a consequence of this trend we are seeing increased demand for leasing finance as businesses look for more flexible ways to finance hosted cloud services rather than the more traditional method of buying hardware or software outright”.

Increasing demand for cloud services is also creating new growth opportunities for the UK telecoms industry. One UK business that has recognised the rising demand for cloud services is Berry Telecom, a young and fast growing business-to-business telecoms reseller.

Jo-Anne Udy, Finance Director of Berry Telecom said: “This is an exciting year as, in addition to growth from upgrading hardware and software for existing customers, we are forecasting increased new product sales due to increasing market demand for cloud. In response to this we are launching an innovative cloud based system which offers assured voice quality, short term rentals, and experienced staff to support the installation and maintenance of the phones. This will be supported by investment in hiring and marketing to raise awareness of our offering in a competitive market.”

The use of cloud computing can present multiple benefits for an organisation such as increased security, reliability and resilience for a potentially lower cost. However, it is worth noting that by processing data in the cloud, personal or otherwise, an organisation may encounter risks to data protection that they were previously unaware of. It is therefore important that data controllers take time to understand the data protection risks before moving to a cloud computing solution.