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The drive to reduce computing costs and length of time public sector contracts run for is taking some time to sink in said UK government deputy CIO, Liam Maxwell.
Despite the launch of CloudStore and the government's strategic documents setting out a new approach to IT, Maxwell, who was speaking at the Business Cloud Summit in London, said that many suppliers hadn’t yet changed their approach.
“We still have contracts coming in at £350m, we find that difficult to justify,” said Maxwell. He pointed out, however, that the existence of CloudStore has meant providers are willing to reduce costs drastically when confronted by competition. “To take one recent example, a provider said the hosting for one component would come in at £57m. We looked at CloudStore and found that we could do it for 940k. We went back to the original provider who said they could do it for £2m.That's what competition brings,” he added.
The problem is that we are talking about a double whammy of high costs and little accountability. “We spend about one percent of GDP on IT– that's too much, just to shuffle paper around,” warned Maxwell. And a lot of it is guesswork. “We think we spend about £1.2 billion on hosting. We have to say 'we think' as it's difficult to get the exact figures.”
And it's not just a question of cost said Maxwell, there is still an issue of length of contracts. “A recent example was a project that took three years in procurement,that time scale is going to shut SMBs out of the process.”
Maxwell said this was not just a question of saving costs in government, there was a fundamental need to move away from some of the large organisation and push more business towards SMBs. “We will not grow our economy with large investments – we need to have small businesses growing quickly. - Three years in procurement isn't going to do that,” said Maxwell.
Maxwell admitted that there was still some way to go with CloudStore before it could exactly fit users' needs.”We need to lower the barriers of entry,” he said, He also said that more work had to be done to place to the user at the heart of the process, for example, by introducing greater transparency on the cost per transaction.