No, they most certainly are not. They are real and are on the rise.
Recently, we commissioned a report into the state of public cloud in banks. One area we looked at was budgets – and the results were eye-opening.
First of all, over half of the people we spoke to are already using public cloud services, or are aware of public cloud services being used by another line of business in the bank. And 64% of respondents intend to migrate certain systems to public clouds in the next two years, or are aware of their banking clients doing so.
This shows we are at a turning point, with banks starting to see the benefits of public clouds outweighing the risks.
The pace at which public cloud projects are going on varies across the bigger and mid-size banks. Each bank is doing something different. On the whole, respondents believe IT budgets for public cloud projects will rise by 6 to 10% in the next two years, however some individuals inside the banks have stated that certain projects have warranted a budget increase of up to 70%. This may be because they were very low in 2016 and 2017, meaning additional funds are required to cope with the initial spin-up fees.
The chief cause of pressure to migrate to public clouds and invest this budget is cost. Almost all of our respondents have cited cost savings as the main reason for migrating systems to public clouds. That, and digital transformation demands.
If projects are migrated to public clouds, lines of business can control what they need, when they need it and if they need more, while saving money. Operating costs decrease in banks simply because business units “pay as they go” at the point of demand and decline.
By implication, this changes how business units approach dealing with their technology needs, and IT teams start to operate differently. Cloud projects herald an era of “Bring Your Own Solution”, so lines of business can use their own budgets to satisfy hardware demands, without having to receive ongoing approvals from the IT team, which is a long, arduous process.
To find out more, you can read the full report here.