Home Frustrated, Three Banks Form Alliance To Forge Ahead Into Cloud Computing

Frustrated, Three Banks Form Alliance To Forge Ahead Into Cloud Computing

Frustrated with high maintenance costs, three of the world’s largest banks are forming a technology buying alliance to forge ahead into cloud computing.

According to Jeanne Capachin of IDC Insights , Bank of America, Commonwealth Bank of Australia, and Deutsche Bank are forming a technology buying alliance which they see as a way to reduce their infrastructure costs and forge ahead into cloud computing.

Driving the issue are the high maintenance costs that they are charged by technology companies.

The banks believe that by joining together they can “force a change in procurement practices and move to more shared or even open source solutions when they make sense.”

The banks believe that traditional technology suppliers are not embracing cloud computing. Instead, they continue to show dependence on decades old revenue structures.

Another driving force in the alliance is the financial crisis and the resulting reduction revenues.

According to Capachin: “Embracing an increased off-the-shelf approach is a necessary prerequisite for these banks and it sounds like, at least in theory, they are ready,”

She says banks have in the past ignored off the shelf services and instead have built their own custom software solutions.

But things are bad enough now that it looks like they are ready to move forward.

The winners? SaaS providers. The losers? The technology giants.

This is one of those events that could have major ramifications. If the banks really are wising up then it should mean considerable disruption in the technology world and the real emergence of cloud computing as the force that will drive innovation and change for many years ahead in the financial services world.

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