IT bosses not sold on cloud computing

London, England – A new report claims cloud computing isn’t a priority for most companies.

67 percent of Chief Information Officers and Chief Financial Officers in UK enterprises say they are either not planning to adopt cloud computing (35 percent) or are unsure (32 percent) of whether their company will adopt cloud computing during the next two years, according to a report from NTT Europe Online.

NTT’s ‘Cloud or Fog?’ report, which polled 200 CIOs and CFOs at large UK businesses, found that decision makers placed cloud computing at the bottom of their top ten strategic investment priorities for the next 12 months. Many were still grappling with the concept – 46 percent of respondents felt definitions of cloud computing remained unclear.

Despite this, 60 per cent said their organisation was more likely to invest in software and services delivered online as a result of the recession. 85 percent of CIOs and CFOs are looking for more flexibility in their software licensing agreements and 68 percent said they will avoid long term IT contracts – benefits widely acknowledged to be delivered by the cloud computing model.

“Decision makers at large UK companies clearly see the benefits of investing in online delivery of software and services however many are unconvinced about taking the plunge with a cloud computing model in the next two years,” said Rob Steggles, Marketing Director at NTT Europe Online.

“Unfortunately cloud has become a technical sell rather than a business and operational discussion, which is where the value really lies. There is certainly demand for online software and service delivery within a secure hosted environment or using a ‘private cloud’ infrastructure, but in a practical sense the classic shared cloud computing model seems not to be on the board’s agenda.”

76 percent of respondents said their organisation was not using cloud computing, citing security, concept immaturity and uncertain reliability as the primary reasons for not adopting it. To consider a move to a cloud computing model, 40 percent of CIOs and CFOs would demand between 10 and 20 percent cost savings to justify the investment.

While the UK executives said their top three strategic IT priorities in the recession were IT security, servers and storage, and network infrastructure investment, the report does not rule out future investment. 45 percent of CIOs and CFOs said they believed cloud computing was not just hype, and 44 percent of those businesses using or planning to use cloud computing said they expected to invest between 6-15 percent of their IT budgets on cloud computing in the next two years.

NTT Europe Online’s ‘Cloud or Fog?’ report is available for download here.