Cloud Computing is the way ahead for governments who want to save money on ICT spend, according to Microsoft CEO Steve Ballmer.

“In terms of egovernment and Cloud and spend and the like, if you take a look at most IT budgets, probably 70%, close to it anyway, gets spent on labour,” said Ballmer during a visit to the London School of Economics. “So if you really want to help anybody save money on IT, you have to say ‘how do I help people save money on labour?’

“If you take a look at modern data centres, they have a lot fewer people in them than today’s data centres do. So I think the fundamental advance that will help – whether it’s the UK government or other institutions – save money is the automation of tasks today that require a lot of labour.”

With the Coalition government currently looking to ICT providers to sign up to a new deal (at lower cost), Ballmer conceded that reducing prices was an option on the table as well. “Sure, we always have a chance to cut our price,” he said, but added: “We tend to be the lower cost participant on most bids; we are not the most expensive guy. So we have been a force for price reduction.

“But that sort of misses the big picture. The big picture is: software helps automate things that people do and software helps reduce the amount of hardware it requires, because both of those things are bigger in the food chain of cost. And moving to Cloud service is a way to kind of bundle a couple of those themes up.”

All roads lead to Cloud Computing within Microsoft at present. “The Cloud to me reflects the transformation that’s going on in the computing world from things which are islands, from things which are either in a corporate data set or in the Internet to things that are in both,” explained Ballmer.

“To some degree when people talk about the Cloud they will talk about all the money it could save to enterprise people spending money on IT. When I talk about the Cloud we will talk about that but we will talk about how it changes the way you write every programme that gets written; we will talk about the way it changes the way you design and build every computing device on the planet. We will talk about the new kinds of applications that you couldn’t have built in a world without the Cloud. We might think we have kind of gone full circle on that; we have only scratched the surface.”

But there are new burdens as well as opportunities to come from the Cloud, he warned. “The Cloud will certainly also bring with it a new set of responsibilities in terms of security, privacy and data availability, “ he noted. “As soon as you start pooling computing and data in new and interesting ways, really defining and really being careful about weighing up who owns what data and how it is controlled and used is a fundamental responsibility of every participant in that chain.”

Source: http://www.publictechnology.net/sector/central-gov/clouds-cut-government-ict-spend-says-microsoft-ceo-0