By Claire West

Chancellor George Osborne’s predicted cuts of 25% in Public Sector expenditure will have huge impact on all of the UK’s businesses many of which count the Public Sector as a major client. As they all wait in trepidation for the 20th October announcement when swingeing cuts — predicted to be the biggest in a generation - are expected to be announced, there is re-focus on how to lessen the impact by increasing efficiencies and reducing costs still further. One strategy that has proved particularly attractive to the Public Sector is the adoption of the new wave of Cloud-based computing and communications solutions, which with its enhanced levels of security is generating significant interest from many government departments and their suppliers alike for the potential efficiencies and savings offered.

As part of the government’s efficiency drive there is the additional directive for Public Sector organisations to offer more contracts to smaller, private sector suppliers rather than opt for the large (often more expensive) companies that have hitherto won the lion’s share of contracts. Additionally, these potential supplier organisations are finding that the new wave of Cloud-based solutions are helping them win business as through the Cloud computing model they have now have access to powerful technologies they previously could not afford, allowing them to compete on more equal terms with the larger companies.

While this year’s research from Garter predicting the ‘widespread adoption of Cloud computing is now here’, more entrepreneurial companies are looking at the next generation of Cloud-based solutions which take a holistic approach to all the IT and communications needs of businesses, and promises to supply further increases in efficiencies and cost savings through the true integration of software and telephony, enhancing collaboration and communication and providing savings in time, effort and costs.

Piers Linney, joint CEO for Outsourcery, the UK’s leading unified communications and Cloud computing company, and Microsoft Hosting Partner of the Year, said, “Gartner has predicted that it expects 20% of businesses not to own their own IT assets by 2012 (driven by Cloud adoption) and the underlying trend will be accelerated by predicted Public Sector cuts that will have a ripple effect through many of the UKs private businesses which sell to it - whether directly or indirectly. The next generation of Cloud-based solutions that Outsourcery is championing is a revolutionary approach to IT and now covers integrated communications too, while the increased pressure to make savings and protect frontline services will force organisations to re-consider their strategies and take a serious look at what the new wave of cloud can offer. This is great news for the smaller supplier as through the Cloud model they can now ‘punch above their weight’ and take advantage of technologies and skills that prior to Cloud were unaffordable."

He continued, “This interest in Cloud is by no means limited to smaller enterprises and we are finding that larger organisations in the sub-corporate and larger categories are also looking to benefit from the savings and efficiencies that are possible from Cloud technologies.”

Cloud computing has barely permeated the consciousness of the business world when the next development in this technology is making waves. Cloud technology has gained wide spread adoption over the past year as the recession has caused pressure on businesses to cut costs and seek greater efficiencies in an effort to remain competitive. Additionally, the impact caused by the way Cloud computing is paid for has turned the IT industry on its head and changed IT expenditure from a CAPEX to an OPEX cost, a factor highly attractive while the banks continue to resist all attempts to increase lending to businesses and debt finance is tough to obtain."

Piers Linney concluded, “It now makes absolutely no sense for a small or medium-sized business and even many smaller corporates to invest in and maintain IT and communications infrastructure.”