What Is the Public Cloud?
Though the public cloud is often shrouded in mystery, this technology is simply a delivery model, no different than an onsite server or a virtualized environment. The primary difference between physical, onsite servers and the public cloud is in the service delivery method.
Generally, the public cloud refers to a type of cloud computing in which resources are publicly available for subscription and consumption by any organization. Common examples of the public cloud include Microsoft® Azure, Amazon Web Services and Google Cloud Platform. In this type of delivery model, the provider owns and manages the infrastructure, removing that burden from the customer.
Should Financial Institutions Migrate to the Public Cloud?
Cloud services are transforming business operations for modern financial institutions, especially as their consumers continue prioritizing digital channels. As institutions navigate an increasingly complex environment of regulatory requirements and strive to meet customer demand, the public cloud provides a reliable, accessible and compliant IT infrastructure while optimizing resources.
As your financial institution determines your cloud migration strategy, let’s break down common barriers to cloud adoption and explore the benefits a public cloud-based IT infrastructure can deliver.
What’s Limiting Public Cloud Adoption?
While some financial institutions are embracing the public cloud, others are hesitant to move toward a cloud migration. Here are some common barriers to adoption:
Lack of Information
CSI’s 2021 Banking Priorities Executive Report revealed that nearly 60% of bankers reported they didn’t have enough information about investing in the public cloud. Many institutions that don’t fully understand the advantages of the cloud might consider it a foreign concept, when in reality, it is already a major part of their operations. Any institution with Office 365, Salesforce or Dropbox is already in the cloud.
For years, risk aversion contributed to the slow pace of public cloud adoption, but as more information about the benefits provided by this technology become available, institutions are more likely to embrace the cloud on some level. According to a 2020 IDC survey, global bank IT spending through 2024 is growing at nearly 6% annually, and the banking industry is accelerating adoption of the cloud. Additionally, a recent Celent report shows that adoption among financial institutions is on the rise, with more than 50% of institutions planning to run their workloads in the cloud within five years.
Cloud Migration Timeline
Many financial institutions believe a cloud migration must be an “all or none” event, meaning that everything occurring on-premise must be moved to the cloud all at once. While that could be the case, institutions can deploy a hybrid environment by choosing to only migrate some of their assets to the cloud. The idea of an all or none transition deters some institutions from even considering the cloud, but the reality is many organizations already utilize cloud applications in their daily operations.
Because security breaches often make the news, another common misconception involves cloud security or vulnerabilities. While cybersecurity is a concern for any organization, financial institutions must be extremely vigilant due to the risks involved in a breach. Securing an institution’s data in the public cloud is paramount, and institutions should work with a trusted managed IT security provider to maximize the cloud’s security benefits by ensuring proper configuration of their environment.
Institutions can further enhance their security posture by leveraging their provider’s existing frameworks and controls, which are often more robust and sustainable than those of a single organization. Additionally, a cloud-based IT infrastructure often brings security enhancements, including controlled network access and the use of artificial intelligence to identify risk and escalate situations appropriately.
When large providers like Office 365 go down, the outage makes headlines. But these outages are so rare that when they do occur, it’s a big deal. A fact that’s often lost, however, is that onsite servers have downtimes that are significantly longer by comparison. With a public cloud-hosted infrastructure, your institution will have a resilient, redundant environment. If a single server malfunctions, the redundancy of operations offered by the public cloud allows another piece of hardware to begin operating without affecting customer experience.
Moving Forward with Cloud Services
If your institution is considering a move to the cloud, reviewing your existing technology as you develop your cloud migration strategy is a helpful exercise. Even small steps—such as migrating from on-premise email to Office 365—propel your institution one step further to a public cloud migration.
Making the decision to embrace cloud services doesn’t have to be shrouded in mystery. Once financial institutions understand what the public cloud is and focus on what it can do, the benefits become apparent. Read CSI’s white paper, The Virtual Migration: How the Public Cloud Transforms IT Strategies, to further explore the benefits of migrating your IT infrastructure to the public cloud.