Blue sky thinking?

• Article 3 of 15
• EducationInvestor, July 2011

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Higher education computing is complicated – complicated and expensive. It’s growing ever more complicated and expensive with every passing year, as more and more documents are stored and published digitally, more and more courses have a digital component, and more and more students rely on computers to help them in their work. Handling all that extra computing power isn’t just expensive in terms of the hardware and software – it’s financially expensive to manage and it can be environmentally expensive, creating huge carbon footprints and using vast amounts of energy. And with government cutbacks biting already and students set to demand far more from universities in return for the increase in fees, HEIs are going to have to find ways to do more with less.

New hype de jour cloud computing appears to offer a solution. Instead of an HEI owning all the hardware and software and manage it itself, it can access all the services it needs, whenever it needs them, over the Internet from a service-provider that has all the necessary hardware, software and management skills. Cloud services can be provided by external companies – the ‘public cloud’ – or they can be provided by groups of HEIs gathering existing or new resources together to provide their own cloud services to their internal users and others, sometimes with the assistance of private sector companies – the ‘private cloud’.

“Computing is certainly taxing universities in this country,” says Malcolm Read, executive secretary of JISC, which helps fund and provide IT services to UK HEIs and has recently announced it will act as a broker for cloud computing to HE. “The cost of providing data storage is proving to be rather more than some universities can afford in present circumstances.” But he also sees cloud taking over in other areas, such as “grid computing”, which is used to combine smaller computers together to solve difficult computations. “If you’ve got central cloud provision, it’ll do compute as well as data if you want it to.”

However, he sees fewer opportunities for the commercial sector in this large-scale public cloud: “We’re interested in private cloud, in procuring cloud provision on our terms not on the terms of the big commercial providers. The research education community in general is big enough to do that. We should be able to procure cloud provision for the sector on terms that would suit the computing needs of the research community. So someone like Amazon, which tends to charge by input and output would be enormously expensive way of doing it for the majority of research computing, so we’re more interested in buying infrastructure – not so much at the applications layer although obviously we’re interested in that as well.”

IBM, which is amongst the largest cloud providers, offers few large-scale services to HEIs, although it does offer a “Cloud Academy” to HEIs where they can discuss their cloud needs, and does provide smaller-scale services, according to Murat Gunenc, a cloud business development executive for IBM UK & Ireland. However, e-InfraNet, a three-year EU pan-European project designed to discuss the cloud infrastructure needs of HEIs across Europe and come up with standards for interoperability, has so far seen little interest from the private sector, including IBM, even though JISC’s Malcolm Read says that the project is open to private sector interest: “We have been talking to the big players. Perhaps unsurprisingly, they’re looking at the industry in the commercial sense and people who tend to need rather ‘peaky’ computing demands very quickly and don’t have the same underlying IT infrastructure that universities do. So you can see why the commercial sector would be their focus. When it comes to dealing with researchers and universities, you start talking to very large, very well informed, advanced IT departments, and that’s a market that they feel a little bit harder to break into – one that perhaps is not as large or as profitable as the commercial one.”

Susan Hall, a partner at Cobbetts LLP and cloud computing expert, agrees that large-scale public cloud for HE will prove a challenge to many cloud providers: “If you’re a top-flight research institution, there’s an inclination to make yourself very controlled in what you move to the cloud. There’s an ineradicable need for serious computing power and the question is how you send that to the cloud.” With some HEIs, usually the top tier universities such as Manchester, having some of the most power computing resources in the country, being able to replicate that externally will be hard for most if not all providers.

Paul McCreanney at JMC IT says that since the top universities are more research driven, they’re less worried about variations in student numbers and already have large resources to cater for research needs. Few private sector companies are able to match the computing capability of these HEIs with public cloud provision. Nevertheless, a lot of computing power is funnelled into individual departments, each with their own discreet work, and there is the potential for providers to pool these resources together as a private cloud. However, he warns: “There are more than 40,000 students and over 10,000 staff at some institutions – although the revenue potential is huge, the margins will be lower.”

The answer, says Cobbetts LLP’s Susan Hall, is for private sector cloud companies to look at “less serious stuff” – potential niches that can add value. “Online course delivery, for example – that I could see a lot of interest in. And business schools or law schools, places where there are vocational type scenarios, rather than anything too heavy duty.”

She also suggests that margins will be better for specialist cloud providers. “If you’re in the melee going on in the general cloud, that’s very heavily price driven by the big providers, but specialist providers will find it easier going.”

Companies such as Siteforum seem to be proving this. It offers various specialist cloud services including a social networking platform. It’s working with Bucks New University to offer a service that allows students as well as alumni to network together. “They’re obviously not the highest up the chain in academia or on the list for government investment, so they wanted to extend their reach overseas to bring in students from the Middle East, India and China and make up their funding shortfall,” says chief operating officer Bob Pike. The new system Siteforum is providing, will also replace the university’s virtual learning environment, Blackboard, to help it provide overseas distance learning. From this initial service, the revenues of which for Siteforum are £3k-6k per month, the company will go on to provide other cloud-based services, including online storage of the terabytes of data that the university’s music studio has produced.

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