Are Japanese Banks Early Adopters of Private Cloud?

The adoption trends for cloud computing seem to be upside-down and inside-out as compared to traditional technology adoption. Instead of a handful of enterprise firms across industries (such as financial services and telecommunications taking the lead) it’s the smaller fish that are giving cloud a go. Although this “small fish” adoption trend is taking hold in the public cloud environment, it’s certainly not the case for private cloud. In private cloud, big banks, life-sciences, media and government organizations are leading the charge in North America, with Europe and Asia-Pacific only slightly behind.

But where does this leave Japan? Not known for its early adoption of technology, Japanese firms (especially the banks) like to play wait-and-see before investing in new options for their IT strategies. Take, for example, a contingent from a Japanese banking customer that I helped host in New York last month at the SIFMA Financial Services Technology Expo. You might think they were meeting with several North American banks and vendors to get an idea of where they’d need to be in 5 years, right?

Not so fast. In actuality, some of the earliest private cloud pilots are being run in Japan. For example, one of Platform’s system integrator partners in Japan has built an in-house “training course cloud” for their consultants and customers. Students can request the required infrastructure on-demand for course work requiring many servers, OS’s, etc, facilitating training for more people and eliminating costs associated with manual effort to set up training environments repeatedly.

Platform’s CEO Songnian Zhou discussed this case along with several other real-life success stories at the Global ICT Summit in Tokyo in June. The keynote panel entitled, “New Trends in Cloud Computing Technology,” paired Platform Computing with other industry leaders such as Amazon and Microsoft. To hear more about these case stories, check out the full post-event interview with Dr. Zhou.

Back to the Japanese customer contingent in New York… what did they find? Public cloud is not really an option for any of these financial firms, even for workload-driven cloud bursting. The major institutions the Japanese visited all had the same things to say: the data security and intellectual property issues would never make it past Compliance.

So what are these international firms doing, Japanese included? They’re building an internal private cloud first, where infrastructure operations are streamlined to lower costs and deliver better services. And the next step will not be to cloudburst, but to harvest other resources internally that would otherwise sit idle. Platform already has customers doing this in production--in one case, VDI servers are being used overnight to improve accuracy and timeliness of value-at-risk models for regulatory reporting.

While private cloud (and cloud computing in general) is still in its infancy, more and more pilots are going in every day all over the world. For the rest of the world, watch out. The membership of the early adopter club is expanding, and major Japanese firms are getting aggressive. Being a tech fast-mover is more important than ever to build competitive advantage.