The Bankwatch

Tracking the consumer evolution of financial services

Banks have to understand the ‘cloud’ and solve their security concerns

The latest report from PEW offers Banks something to think about.  The reality of cloud computing already exists, with a clear majority of internet users taking advantage of the convenience of cloud computing.

PEW – Use of Cloud Computing Applications and Services

Some 69% of online Americans use webmail services, store data online, or use software programs such as word processing applications whose functionality is located on the web. Online users who take advantage of cloud applications say they like the convenience of having access to data and applications from any Web-connected device. However, their message to providers of such services is: Let’s keep the data between us

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And while the usage of cloud computing is heavily skewed to youth, it is still heavily used by 50 and above.

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However the most important point in the report should be lost on no-one.  The reason people use them is nothing more esoteric that convenience.

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That’s convenience that can be summarised from three key aspects.

  1. Easy to use
  2. easy to share
  3. Information is not lost in event of computer failure

The corollary to #3 is that people trust cloud computing.  Speaking personally, the number of times I have had to change laptops, has been dramatically simplified because of the cloud.  Another example of convenience is cross devices.  I have been in a meeting, and needed some information, with no laptop or wireless connection handy.  I can search my gmail from the Blackberry gmail application.  The implication of my information being in the cloud is that its simply retrievable anywhere.

Another example:  At CommunityLend we are building an application with developers and editors in multiple locations and timezones.  With the use of Github, we are able to maintain version control, yet share an entire application with everyone working locally on the latest version, without concern for overlapping versions.  Take that scenario, and apply to business documents.  Establishing true version control, and maintaining convenience is hard, and the future of productivity for business users must be in the cloud. 

Relevance to Bankwatch:

For consumers, cloud implications for their financial data might be:

  • use of wesabe or mint
  • how about an open API for online banking that negates the need for customers to provide their usernames and passwords to other services

In other words Banks have to get their head around the cloud, and solve their security concerns, not hold them up as roadblocks.

Written by Colin Henderson

September 13, 2008 at 15:57

3 Responses

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  1. Mint is definitely the best way to go.

    Robert

    September 14, 2008 at 05:35

  2. I get and agree that bankers have to get their head around the cloud and solve their security concerns but this more to them than just a leap of faith. Switching to a new email provider, as a conusmer, is a leap of faith but due to regulatory pressures, reputation hits, and lack of knowledge bankers don’t understand a way to do this.

    Cloud computing has the same issue as social media. The industry needs to be doing it, but they don’t know how to and still feel adequately protected.

    Brad J Garland

    January 3, 2009 at 02:15

    • You are right Brad in that those are the things that banks and large companies worry about. I think all I am saying is that they should worry about solving it, rather than worrying about avoiding it. My 2 cents.

      Also ……… interesting you picked up on this one. Interesting (for me anyway) because the next post here is #2,000 and I decided to go off track and do a piece on cloud computing, based on my humble view that its one of the next big things, alongside mobile.

      Colin

      January 3, 2009 at 03:33


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