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Cloud Computing

Brazil moves faster to cloud, driven by need

Cloud computing in Brazil is set to boom in the next 12 months, according to a recent report from market research analyst Frost & Sullivan, with 42% of businesses planning to invest in cloud technologies this year. While cost reduction in the face of continued economic troubles is almost certainly one of the principal drivers, there could be residual benefits for the region.

Culturally, IT execs in Brazil prefer centralised control and perhaps inhibit rapid development through fear of loss of control. It’s not unnatural. Not all European and US businesses are comfortable with the idea of shifting everything to the cloud either. But could an upturn in cloud-based computing services lay the foundations for a technology leap forward, a resurgence that would not only help the economy but also spark innovation in developing areas such as robotics and machine-to-machine communications?

In an article for the World Economic Forum website in February this year, Michael Dell, founder and CEO of Dell, pointed out that modern economies will become increasingly reliant on the digital economy. “Entirely new, digital business models are replacing resource-intensive ones,” he wrote, adding “the opportunities in the digital economy for both growth and sustainability are limitless.”

Fair point. He goes on to add that technology sits “at the nexus of this transition” and in particular, cloud services and mobile technology, which “already allow us to do much more while relying on shared computing resources.” Another fair point but how does this sit in the context of Brazil? Surely the expected upsurge in cloud computing is an indication of the country’s business community getting to grips with the necessary infrastructure to compete?

It seems not. As we witnessed in Europe and the US between 2008 and 2012 there was a surge in cloud computing interest and certainly a surge in businesses looking for people with the skills and understanding. Rightly or wrongly a key driver was cost reduction. There was a good blog by Bernard Golden in CIO magazine in 2009 that asked the question, ‘Is the recession good or bad for cloud computing?’

“Tough times tend to bring forth innovative approaches, and cloud computing is likely to be a beneficiary of the current recession,” wrote Golden.

He was right. So is this what is happening in Brazil?

Yes, according to Frost & Sullivan ICT industry analyst Guilherme Campos, although he points out that the onus is on the cloud computing service providers to “make clients aware of efforts they make to boost data security; for instance, getting certified. They should also ensure that clients understand that their data will be secure and inaccessible to other companies."

Step one. Remove the fear.

By the end of 2015, approximately 66% of Brazilian companies are expected to use at least one cloud offering, according to the Frost & Sullivan report. This should go some way to overcoming traditional technology infrastructure issues, especially as the focus is on using external cloud providers. These businesses can offer economies of scale and enable businesses to use data centre capabilities that would normally be well beyond them.

The benefits should sell themselves. Beyond cost, collaboration is another distinct advantage and something which Microsoft has of course been playing on. The company launched its Azure cloud services in Brazil last June and by September the company was reporting a strong uptake of cloud-based services particularly among SMEs.

According to a report commissioned by Microsoft and conducted by 451 Research, Brazil now tops the global growth league when it comes to deployment of cloud-based services. It has a bit of catching up to do. The WEF’s Networked Readiness Index 2014: Benchmarking ICT Uptake in a World of Big Data report doesn’t exactly paint a rosy picture for Brazil which was ranked nine places lower than 12 months earlier. The index has shown there is stagnation in the region as a result of economic issues and that all infrastructure has suffered.

Cloud computing has the potential to help the country move forward again. It needs a stimulus, an infrastructure that is open and limitless that can help to connect the dots and encourage collaboration. In the past few years the country has been energetic in its pursuit of technology research and knowledge but it tends to have been reactive or driven through outside interest. In 2011 for example, Chinese technology giant Huawei set-up a research centre in Sao Paolo. One of its remits was to help develop local cloud computing skills.

Perhaps this is what the country needs to stimulate its universities and entrepreneurs into innovation? Certainly if Brazil is to compete and get up to speed quickly with fast developing technology markets such as machine-to-machine communication and the internet of things, it has to be cute. It has to transform and reinvent while identifying efficiencies. Perhaps out of its recession and desperation for cost-effective computing it may have found an answer.

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Marc Ambasna-Jones

Marc Ambasna-Jones is a UK-based freelance writer and media consultant and has been writing about business and technology since 1989.

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