Dublin, Ireland, May 31, 2022 BSO, a global infrastructure and connectivity provider, today revealed new research revealing a “resilience paradox” suggesting that financial institutions have come to tolerate poor cloud connectivity experiences.
Almost all IT decision makers rated their connectivity as extremely or very resilient, but all experienced outages to some degree, with nearly half experiencing outages at least once a month. The slow transition to more reliable cloud options costs financial institutions 21-50% of their revenue on average, but only 2% of financial institutions plan to switch cloud providers in the near term. The results are a surprising contradiction given the availability of cloud solutions on the market that guarantee 99.99% availability and 100% data durability for object storage.
The report, Cloud Connectivity and the Future of Financial Markets, is based on a survey of 600 IT decision makers in financial services industries including banking, trading, brokerage, financial exchanges, and crypto exchanges. Companies from around the world were surveyed, including France, Germany, UK, US, Hong Kong, Singapore and Brazil.
Key findings include:
- Performance: Across all industries and countries, the average loss for financial services firms due to poor network performance exceeded $67 million in the past 12 months.
- Data security: The most pronounced impact of security breaches on businesses is lost or misdirected payments, with more than half of businesses (52%) experiencing it, followed closely by the inability to access to accounts or suspended accounts (47%) and inability to use the full and promised functionality of cloud-based applications (41%).
- Global scale: 2 in 5 respondents (38%) said poor cloud connectivity has prevented them from expanding into a new geographic market. Almost half (48%) said it stopped them from launching a new product or service. More than 2 in 10 (22%) said it had stopped them from expanding into a new industry.
- Top Considerations for Selecting a New Cloud Connectivity Provideramount of cloud on-ramps (51%), technology and services that match business needs (49%), low number of transactions requiring repairs or returns (48%), ability to exit risk-free Vendor lock-in (39%) and better currency choices (39%) were the top five considerations for businesses when selecting a new vendor.
- The pandemic effect: Contrary to popular belief, the pandemic was not a major driver of cloud investment because most enterprises (99%) had already started using the cloud to access applications before the pandemic.
The research also found a “north-south cloud divide” when comparing markets across multiple cloud performance metrics. French, UK and US companies have consistently estimated significantly higher impacts of poor cloud performance compared to their counterparts in the southern hemisphere, Hong Kong, Singapore and Brazil. Cumulative losses topped $442.67 million for French, British and US firms, eclipsing losses of $64.71 million for firms in Hong Kong, Singapore and Brazil.
Key findings from the north-south cloud split include:
- Low latency: On average, businesses lost $14 million in lost transactions over the past 12 months due to failure to meet their low latency goals, US businesses ($64.45 million), UK businesses ( $16.18 million) and French ($15.97 million) with the largest losses.
- Resource scaling: Over $25 million in revenue was lost in the last 12 months on average due to the inability to scale resources effectively. The United States recorded shockingly higher losses ($142.83 million) than the rest of the world and eclipsed British companies ($15.43 million) in second place.
- Source real-time market data: Failure to obtain real-time market data costs banks $18 million on average. US banks lost $44.72 million, followed by UK banks ($14.63 million) and French banks ($12.69 million).
“The importance of cloud technologies is well established among financial services institutions, but this is the first report of its kind to reveal the impact of poor cloud connectivity on companies’ business success. The losses suffered by financial services institutions last year due to poor cloud connectivity should be a wake-up call for the industry. Said Michael Ourabah, CEO of BSO. “The results raise an important question: why are institutions reluctant to change their cloud connectivity when solutions are readily available? Whatever the answer, the most successful institutions will be those that take a proactive approach to their cloud strategy. »
The report is available at https://www.bso.co/cloud-connectivity-report
Notes to Editor
The survey was conducted from February to March 2022 by independent research agency Coleman Parkes. It surveyed 600 senior IT decision makers in finance responsible for identifying and implementing cloud connectivity infrastructure. The companies surveyed were from the following industries: banking, trading, brokerage, financial exchanges, and crypto exchanges. The results cover major financial centers around the world covering France, Germany, UK, USA, Hong Kong, Singapore and Brazil.
Founded in 2004 and with a heritage of serving the world’s leading financial institutions, BSO is a pioneering global infrastructure and connectivity provider, serving more than 600 data-intensive enterprises in various markets such as financial services, technology, energy, e-commerce, media and more. The company owns and provides critical infrastructure, including network connectivity, cloud solutions, managed services and hosting, which are specific and dedicated to each customer served.
BSO’s network includes more than 240 points of presence in 33 markets, more than 40 cloud on-ramps, is integrated with all major public cloud providers, and connects to more than 75 online Internet exchanges and more than 30 scholarships. Its team of experts works closely with customers to create solutions that meet their detailed and specific business needs, delivering the latency, resiliency, and security they need, regardless of location.
BSO is headquartered in Ireland but has 11 offices around the world including London, New York, Paris, Dubai, Hong Kong and Singapore.
Find out more: www.bso.co
Tilson Pinto/Kaif Siddiqui
CCgroup – [email protected]