PSTF: Take risks with cloud computing

Mark Masterson, innovation lead at CSC, spoke to delegates about the advantages of using cloud computing technology within insurance businesses.

He said that the regulatory environment is lagging behind the pace of change within IT and holding back the development of cloud computing technology.

In response to a question from the floor from Jeremy Reynolds of CGI, Mr Masterson explained that the chief difference in the economic model between systems based on cloud computing and more traditional models is one of contractual terms.

"Some say it is about stripping the cost out — but that is not what is interesting. The most interesting thing about this model is the change in contractual terms."

He said as well as bringing down operating costs to such a "fundamentally low" level, companies "can do it on a cost structure that enables them to take risks that in the past providers would not have been able to do".

"If you can reduce the cost of failure you can do it more frequently," he said.

Mr Masterson described cloud computing as "the single most important thing to happen in IT and business in 50 years".

He added that the technology will begin to be seen as not just a driver for productivity but "a key enabler for growth".

Speaking about the conflict between companies' desires to commoditise while differentiating themselves from the competition, Mr Masterson said that what businesses want to achieve with new technology means they are more similar to one another than they think. He concluded it is possible to look for sweet-spots where things can be commoditised and technology be applied.