SA sees hive of activity in cloud space

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The Standard Bank Group yesterday announced it has chosen Amazon Web Services (AWS) as its preferred cloud provider.

The move comes as SA is witnessing a hive of activity in the cloud services space, with Microsoft's Azure having recently been made available in the country and Chinese telecommunications giant, Huawei, also offering its cloud services commercially in SA.

In a statement, Standard Bank confirms it has selected AWS to "accelerate mass migration, drive digital transformation, and enhance security posture in the cloud".

The bank adds it intends to migrate its production workloads, including its customer-facing platforms and strategic core banking applications, to the AWS cloud.

Jon Tullett, research manager for IT services, Sub-Saharan Africa at IDC, highlights that SA business is now quickly ramping up cloud adoption. "Case studies like this are going to be key to keeping the momentum going; it's hard for an SA business to ignore the benefits of cloud when their business banking provider is moving its core business into public cloud."

Arthur Goldstuck, World Wide Worx MD, adds the increased action in the space reveals pent-up demand for cloud services, as more and more companies wake up to the massive benefits.

Banking on the cloud

According to Standard Bank, it plans to leverage AWS services, including data analytics and machine learning, to automate financial operations and enhance customer-facing Web and mobile applications.

Furthermore, the migration to AWS will take place across all business units, subject to approvals from local regulators, including personal banking, wealth, corporate investment banking and insurance, driving a more personalised banking and investment experience for customers, the bank states.

The financial institution indicates its choice of AWS is because of its "broad and deep portfolio of cloud services, overall commitment to security excellence, and strong financial services experience".

The South African Reserve Bank confirmed Standard Bank can make the move to AWS while still meeting all current compliance requirements.

Sim Tshabalala, group CEO of Standard Bank, says: "AWS cloud technology will create a springboard for Standard Bank Group, helping us to rapidly roll out our digitisation and data strategy to better cater to customers whose needs are constantly evolving. The combination of AWS's rapid agility and high levels of security, combined with Standard Bank's customer obsession and desire to constantly raise the bar, will allow us to build Africa's financial services organisation of the future and to be positioned as more than a bank."

Goldstuck points out Standard Bank is one of the biggest wins yet for the hyperscale data centre industry. "They are one of the continent's biggest data centre users, but until now have typically depended on their own facilities. This will be a kind of starter's gun for other major institutions to embrace the cloud."

In terms of some of the benefits of selecting AWS for the bank, Tullett says it will be primarily in business agility.

Building out new services quickly with tight integration tends to be where legacy banking infrastructure struggles, he states. "Cloud services applied to that infrastructure will be more suited to modern banking needs. There will be numerous other benefits, from a technical and skills perspective, as well as a realignment of data centre assets. This is a big deal for a bank, with a lot of long-term ramifications on both business and infrastructure sides."

For Derrick Chikanga, IT services analyst at Africa Analysis, the benefits of cloud migration include cost reductions.

"Unlike traditional server-based systems, cloud solutions ensure excess ICT capacity is avoided. Further, cloud services are agile and ensure any future acquisitions by the bank will be easily integrated into the system," says Chikanga.

"The migration to the cloud will result in skills upscaling for the bank's employees, providing it with a competitive advantage in its ability to create innovative banking solutions. Cloud services will also reduce latency as experienced by the current traditional services, and ensure efficiency in the bank's operations."

Altron prefers Azure

Earlier this month, JSE-listed Altron announced it has migrated its human resource information systems and payroll to Microsoft Azure.

The software giant's cloud services include Microsoft Azure, Office 365 and Dynamics 365.

Altron is of the view that migrating its application data to the cloud will result in cost savings, improved efficiencies and data security.

According to Chikanga, businesses are starting to realise the operational benefits provided for by cloud solutions, such as the ability to quickly upscale their IT hardware and software infrastructure, based on business needs.

The increased activity, he continues, also highlights the increased faith in the level of security provided by cloud solutions, particularly public and hosted private cloud solutions.

"Previously, organisations have been reluctant to surrender their internal IT infrastructure to a third-party, due to security concerns around potential cyber attacks.

"The increased activity in the local cloud market further demonstrates the increased awareness by organisations, of the need to embrace digital transformation to remain competitive and stay relevant in the market," Chikanga concludes.

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