August 10, 2020

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Scaling up the hybrid cloud in Hong Kong

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Currently, the world is eagerly watching as 5G networking technology is rolled out gradually. Its arrival is expected to spark a huge take-up of cloud services which are now becoming more affordable, better and faster. This will encourage more companies to begin their transition to remote computing.

Among cities in Asia, Hong Kong is well-placed in terms of its cloud readiness. The Asia Cloud Computing Association (ACCA) ranked the region second in the 2018 Cloud Readiness Index based on cloud infrastructure, security and regulation.

However, despite the support of the government, a significant portion of Hong Kong businesses have yet to embrace cloud technology.

A market study undertaken by a major international banking group in 2018 shows that only 28 per cent of companies surveyed said they had digital plans in place.

The need for cross-sector collaboration

The public and private sectors will need to collaborate and explore how cloud solutions can be deployed to enhance information sharing and more efficient management of data.

The Hong Kong government has invested in the city’s development as a smart city, outlining plans over the next five years and beyond to develop its infrastructure around innovation and technology.

The city has a competitive advantage when it comes to becoming the cloud technology hub of the region owing to its reliable telecommunications infrastructure, exceptional broadband quality and the free flow of information.

The government is taking steps to ensure this will happen, leading by example. It is currently developing its own next-generation GovCloud and big data analytics platform, expected to be launched in the third quarter of 2020.

The planned adoption is expected to streamline government services and save it and the city’s residents money and time through a more agile and cost-effective delivery of common e-government infrastructure.

Enabling more movement between software

Cloud models can be private, public or a combination, known as hybrid, and there are advantages and disadvantages to these models, depending on the prospective users’ IT infrastructure load and business objectives.

A major concern about adopting a single company’s services is “vendor lock-in” which can limit options, making firms unable to migrate data to another service once it is on a particular cloud.

However, this problem can be solved by choosing providers that use open-source software for developing and hosting cloud infrastructure, giving customers the freedom to move between software easily.

The finance industry, which uses huge amounts of data, stands to gain from the adoption of cloud technologies, and one of the world’s biggest banks is migrating petabytes of data to the cloud.

Other initiatives include greater cross-border collaboration with mainland Chinese financial authorities, a greater focus on local research and development, and other innovations for both the industry and customers.

The government has earmarked HK$45 billion (US$5.73 million) for tech-related projects, including high-school-level IT Innovation Lab programmes, improving universities’ research facilities and expanding Hong Kong’s technology and digital business park, Cyberport.

Cloud tech is for everyone

The benefits of cloud computing extend beyond banks. As the technology is adopted by the finance industry and beyond, it will help to ease the digitalisation of operations while redefining customer experiences and accelerate innovation.

SMEs are a natural fit for cloud computing services owing to their light IT infrastructure. They are also more eager to look into cloud offerings that can help them scale their business and incorporate innovative cloud compute products (including those that are AI and IoT related).

Start-up communities are industries that are extremely mobile such as transport and logistics, and automated manufacturing, with its high data load, are all in a position to benefit from cloud technologies.

Cyberport currently hosts a cloud computing centre to provide a community cloud infrastructure for start-ups. This allows entrepreneurs with smaller capital access to cloud technology in a cost-effective manner.

The government is also assisting SMEs in procuring cloud-based solutions through its Technology Voucher Programme, which provides grants of up to HK$400,000 to businesses in the sector to help them adopt and access technological services and solutions to improve productivity or upgrade or transform their business processes.

Bridging the knowledge gap

Hong Kong companies are cautious by nature; this makes them unwilling to embrace the technology completely.

The biggest challenge of promoting cloud technology in Hong Kong is a preconceived notion that deploying cloud will mean incurring added security risks.

This worry is not unfounded; 2017 saw 61 per cent of SMEs in Hong Kong reporting a cyber breach in the previous three years, according to a survey.

Some common causes of the breach included use of non-company devices to access the company network, the risk from third-party service providers and – for smaller businesses – low budgets for cybersecurity.

The expert stated that there is a knowledge gap that providers are struggling to bridge. Many consumers do not know where and how the cloud operates.

To mitigate this, the HKMA founded the Cybersecurity Fortification Initiative, which is tasked with roles including developing the skills of cybersecurity professionals and encouraging them to share cyber intelligence. T

he Office of the Government Chief Information Officer also has implemented a practice of sending out real-time security alerts when it detects online vulnerabilities.

While SMEs may be at risk of a data breach with their limited resources, choosing a good cloud service provider will enable them to not only realise the benefits of cloud technology but also boost network security.

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