Cloud computing, considered to be a concept only for tech-geeks a few years ago, is now fast capturing attention corporate in Qatar. Companies are now approaching cloud service providers to understand the details of this concept. Seeing its rising popularity, cloud service providers have begun to expand their services in Qatar.
The concept of cloud computing began to gain momentum in western countries at the beginning of the 21st century. With the rise of computers, there was a need of a technology which allowed users to access data from multiple locations and different devices while travelling – and the answer to this need was cloud computing.
Simply put, cloud computing is the delivery of computing services — servers, storage, databases, networking, software, analytics and more — over the Internet (‘the cloud’). Companies offering these computing services are called cloud providers and typically charge for cloud computing services based on usage.
Companies store data of an individual or a company in a secure location that can be accessible from multiple locations and through multiple devices, such as laptops and mobiles. The entire data is encrypted and cannot be hacked as it is secured by multi-layer security.
Encryption is the conversion of electronic data into another form, called ciphertext, which cannot be easily understood by anyone except authorized parties.
“Cloud computing boasts several attractive benefits for businesses and end users. Flexibility in usage and pricing are major advantages, compelling companies to embrace cloud”
Cloud computing boasts several attractive benefits for businesses and end users. Flexibility in usage and pricing are major advantages, compelling companies to embrace cloud.
Companies can scale up as computing needs increase and scale down again as demands decrease. This eliminates the need for massive investments in local infrastructure which may or may not remain active.
“Price flexibility is a huge advantage because cloud computing offers customers subscription-based fee structure. For availing cloud services, a company does not need to pay a huge amount upfront and they can opt for subscription-based usage. They can opt for annual or six-monthly subscription,” said Subhash Ghosh, a senior official at Tyconz, an IT company. Tyconz is a major SAP solutions provider in Qatar and the MENA region.
Another advantage is that software solutions such as developing mobile applications for companies can be done. Cloud service providers develop applications through which employees and customers of a company can access data on smartphones.
“Earlier there were concerns among customers about cloud computing. For example, one of the concerns was that by hosting important data with a third party in cloud it may be hacked or some competitor may access their data. But now these concerns are taken care of as cloud service providers offer multilevel security,” explained Ghosh.
“We expect that 90% of our customers to migrate to cloud computing. Most of these customers are private companies. Recently we have tied up with Microsoft Azure to provide us cloud services to our SAP customers,” said Ghosh. “Companies are convinced about cloud because they have seen its benefit and they now want a hassle-free management of their IT needs,” added Ghosh.
When it comes to cost, cloud helps companies to save a lot. If a company intends to set up a factory in a remote industrial area, then it will have to create infrastructure for its IT network. The company will have to procure a server and create space for it. Additionally, staff would be required to maintain and protect servers and the company will have to procure a license for the database.
A simple calculation makes it clear how cloud helps in saving cost. A server of 5GB RAM currently costs around $20,000 (QR73,000) and companies need multiple servers to host data. But if a mid-sized company opts for cloud, it can get a one-year subscription for $6,000-7,000.
“Tyconz has one data center in Paris. We are hosting customer data on the cloud in that data center. It caters to the needs of the Middle East region,” said Ghosh. In February, Qatar-based healthcare support company, SciTech Arabia, announced the migration of its business communications environment to Microsoft Cloud.
SciTech Arabia supplies cutting-edge medical and laboratory equipment and support services to healthcare and diagnostics centers across Qatar. The company has seen rapid growth over the past four decades, enjoying a 25% market share and annual turnover of more than $50 million.
“Encouraged by the success of its transformation project and the ability of the Microsoft cloud to deliver services, SciTech Arabia is now working on moving its entire production environment to the cloud, to maximize business efficiency,” said a senior official of SciTech Arabia.
Taking note of the growing demand of cloud services, the service providers are also expanding their services in Qatar.In March, Global software company SAP, announced plans to launch a private cloud data center to accelerate Qatar’s digital transformation.
“Using cutting-edge cloud solutions, Qatar’s organizations can cut costs and drive efficiency, become more responsive to citizens’ and customers’ needs, and deliver innovative new business models”
“Using cutting-edge cloud solutions, Qatar’s organizations can cut costs and drive efficiency, become more responsive to citizens’ and customers’ needs, and deliver innovative new business models,” said Gergi Abboud, Managing Director of the Gulf, North Africa, Pakistan, Levant for SAP. “Real-time information management is the foundation for Qatar’s organizations to drive Qatar National Vision 2030 digital transformation and economic competitiveness goals.”
Experts believe that along with private companies, the cloud services will also help government and semi-government organizations.
“Qatar’s government, banking and finance, and oil and gas sectors will be among the biggest beneficiaries of the private cloud data center, as they can manage and analyze citizen and customer data in the country. Organizations in Qatar will be able to leverage SAP’s best practices in using cloud services to cut costs, deliver new products and services, and free up staff to focus on innovation,” said Edwin Kolen, Senior Vice-President for Europe, Middle East and Africa of Cloud4C, SAP’s local partner in Qatar.
Ooredoo’s Qatar Data Center, officially launched in 2006, was the first facility in Qatar to offer businesses a full suite of enterprise services. In the last 10 years, Ooredoo has developed five state-of-the-art data centers in Qatar to cater to the growing needs of companies. Ooredoo is open to expanding the capacity of its data center in future.
“Qatar Data Center is one of the most sophisticated and advanced data centers in the region”
“Qatar Data Center is one of the most sophisticated and advanced data centers in the region. The first facility was approximately 2,000 square feet and provided co-location and basic reporting services. Over the past decade, Ooredoo’s Data Centre offering has grown so much that it now manages and operates five data centers with a capacity of more than 55,000 square feet, with potential future expansion capacity of up to 100,000 square feet,” a senior Ooredoo official said.
“Qatar Data Center facilities have been designed in compliance with Tier-3 standards and provides local and regional organizations with a full range of services including hosting and co-location, cloud services, data backup and restoration, managed storage, email and web security and more,” he added.
In Qatar’s ICT Landscape 2016 Report, the Minister of Transport and Communications noted that though about 76% of business establishments are aware of cloud computing (up from 14% in 2012), the use of technology is very low, with only 3% of business establishments in Qatar currently using this technology. The larger the business, the higher is the use of cloud computing in Qatar.
According to the report the key barriers to cloud computing, reported by those businesses that were surveyed are lack of need (62%) and lack of familiarity with the concept of cloud computing services (24%). Another 13% were not sure about how cloud computing would help their business.
Among the business establishments using cloud services, about 61% reported that the data storage for their cloud services was physically located within Qatar. The trend of using cloud services with physical data storage capabilities within Qatar is higher among the establishments with over 50 employees; small establishments with 1–9 employees seem to be more flexible and equally consider cloud services with storage facilities outside Qatar.
“A lot of applications are becoming cloud-based. If one does not use cloud they cannot use them. So these applications are pushing firms to become cloud-based. Going forward the cost per user will continue to go down”
Going forward, the only direction for cloud computing is up, say experts. “A lot of applications are becoming cloud-based. If you do not use cloud you cannot use them. So these applications are pushing you to become cloud-based. Going forward the cost per user will continue to go down. The reality is that those mega-scale data centers will be managed in much more cost-effective ways, which will drive the cost per user down,” a senior Microsoft Qatar official said.
A tough economy also works in favor of cloud service providers. “Compared to other regions, cloud services are bound to increase sharply in GCC countries. Companies in this region are now focusing on saving costs as oil-driven revenues are not coming as fast as it used to be in the past. Low oil prices will help cloud services to grow,” the official said.
According to a new market report published by Future Market Insights, titled ‘Data Storage Market: Middle East Industry Analysis and Opportunity Assessment, 2015 – 2025’, the Middle East data storage market was valued at $1.48 billion in 2014 and is expected to register a CAGR (compound annual growth rate) of 14.4% from 2015 to 2025. Growth of the Middle East data storage market is primarily driven by declining prices of consumer storage devices and advancements in information and social technology, the report noted.
The cloud-based storage sub-segment is expected to expand at the highest CAGR of 19.1% during the forecast period in terms of value.
“The stability and flexibility offered by the enterprise storage, coupled with its lower cost, is the prime reason responsible for the robust adoption of cloud-based storage across the globe. Cloud computing is a hassle-free and cost-effective data storage facility,” the report said.
This article is from BQ Magazine’s Issue 43 – April 2017.
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