Technology - Cloud computing: Reach for the skies

IN June, Microsoft launched Office Web Apps in the UK, a cloud-based version of the desktop suite with which most people will be familiar. It allows free online access to scaled-down versions of Word, Excel, PowerPoint and OneNote.

Microsoft's move follows on the heels of Google Docs, a similar service launched in 2006 that upgraded to 1GB of free data storage in January.

The move to cloud-based office productivity applications is likely to be most acutely felt by consumers, who are only just growing used to the idea of programs and processing being available remotely. It could also prove to be very useful to cash-strapped small businesses looking to expand their offerings.

Although there is no reason why people at larger businesses cannot access Microsoft's service through their own Windows Live accounts, a firm has to use Microsoft's business platform, SharePoint, which comes at a cost. As a Microsoft spokesperson explained on IT website redmondmag.com: "While Windows Live is great for consumers, it lacks some of the SharePoint capabilities such as manageability, compliance, controls and so on that are important to enterprise customers."

Brokers fall into the latter category, with their requirements typically stretching beyond Word and Excel documents to, for instance, customer relationship management and policy placement software: even with such specialised needs, the move to cloud technology cannot be ignored.

Pack leaders
Simon Ronaldson, sales and marketing director at Acturis, pointed out that, in many ways, brokers have been ahead of the game. SaaS is something that Acturis has been offering since 2002 and he believes it will become even more valuable.

Where brokers could see a difference is in the charging structure. As Kevin Child, operations director at SSP, pointed out: "The cloud is based on a model where you pay for as much as you use." For smaller brokers, if you need Photoshop to manipulate images only once a year then it might be advantageous to simply access the program when needed rather than have it sat on a computer as a rapidly depreciating capital asset.

Companies such as Amazon have offered secure online data storage using cloud technology for some time but Child argued that where and how business and client data is stored is a concern for brokers. He explained: "Brokers will be suspicious, as they won't know where their data is and it's a stretch too far now to tell our customers that it's out in the ether somewhere. The managed service is the best place to be in anticipation of the cloud."

Another advantage that cloud computing can offer is scalability, matching peaks and troughs in demand. Ray Vincent, managing director at Transactor, commented: "It is something we are looking at for call centres that have increasing demands. For example, motorbike insurance demand increases in the summer and there is extra use of temporary staff."

Whether or not brokers large and small find themselves attracted to cloud-based services, it is possible that the impact of it will come without their knowing as insurers look to it for efficiency savings. As Vincent concluded: "There's no question that the quote process in personal lines is going to be driven by external forces. It is a process of joining up the dots by which each insurer will deal with identical claims histories. With data synchronisation - perhaps just a postcode and driving licence number - consumers will be able to get quotes."

Expert view
Simon Hughes, sales & marketing director, Open GI
Several of our offerings make use of the cloud computing concept in order to reduce IT infrastructure, deployment and maintenance costs for our brokers. The additional benefit is that integration with other third-party systems becomes much easier.

We are increasingly moving our systems to a hosted, web-based environment and partnering with other organisations in order to leverage data and integration services. Most parts of our offering now integrate using web services. We services make it easy for different systems to work with each other over the internet or within an internal network without worrying about underlying technology used.

Our commercial trading platform, Open trader, is an example of a cloud computing application: the system is hosted centrally and accessed by brokers over the internet. The cloud environment makes features such as electronic referral processing, remote quote-engine integration and system maintenance easier because the internet provides a way for all stakeholders to interact with the same system.

Source: Professional Broking – September 2010