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Google persuades Spanish bank BBVA to use the cloud

2012-01-11 13:36:57

By Tim Weber Business editor, BBC News website

Spanish banking giant BBVA is switching its 110,000 staff to use Google's range

of enterprise software.

The deal is the biggest that the search giant has signed with one company for

its cloud-computing services, where software is offered as a service via the

internet.

The bank told the BBC it will use Google's tools only for internal

communication.

But the deal could be seen as a breakthrough in corporate adoption.

Banking - with its high security needs and strict regulations - was always

considered to be one of the last industries to accept cloud-computing.

BBVA's director of innovation, Carmen Herranz, stressed that all customer data

and other key banking systems would "stay in our own data centres" and be

completely separate from the cloud solution.

The bank would use Google applications like email, calendar, docs, chat, video

conferencing and other collaboration tools to "achieve a cultural change" and

get "the whole company working together" across the 26 countries where BBVA is

based.

Ms Herranz said the project - with roll-out across all employees to be complete

by the end of the year - was not about saving cost.

"The main goal is to promote innovation and making decisions and increase

productivity. We are in a challenging market and need to make faster and more

accurate decisions... and eliminate duplication," Ms Herranz told the BBC.

Also driving the change was the increasing mobility of the bank's workforce. A

lot of the bank's computing needs had moved to smartphones, tablets, laptops

and computers at home, she said.

Jose Olalla, chief information officer at BBVA, said because workers now had

"access [to] the information they need at any time from any internet-connected

device, anywhere in the world, [they] will be able to be more flexible and

mobile".

BBVA is one of Spain's largest banks.

It is also the largest provider of financial services in Mexico, and has a

large presence in the south of the United States.

'Largest ever deal'

Traditionally, companies have done all their computing on their own premises,

to keep their data secure and to stay in control.

However, most enterprises leave some 80% of their computing power idle, and

find themselves spending more than two thirds of their information technology

budget on maintenance and software upgrades.

Start Quote

To move to the future, you have to leave the past in a box

Carmen Herranz BBVA's director of innovation

Cloud computing tends to be much more efficient, with firms like Amazon Web

Services running their servers at more than 90% of capacity. That cuts cost and

also helps the environment.

The man in charge of Google Enterprise apps in Europe, Sebastien Marotte, said

that his corporate customers on average achieved cost savings of between 50%

and 70%.

But the deal with BBVA, argues Mr Marotte, is important not only "because it is

the largest ever agreement we have signed with an organisation, it is important

because it is a very large financial company, it shows that now even banks are

moving to the cloud".

BBVA's data would not reside on dedicated servers - a solution known as private

cloud - but would sit distributed across the public cloud of Google's data

centres. Both Mr Marotte and Ms Herranz stressed this would meet the demands of

banking regulators and data protection officials, and be as secure as any

solution on the bank's premises.

A bigger worry will be whether BBVA's computer network will be able to cope

with the sharp rise in network traffic that cloud-computing solutions demand.

A pilot with 7,000 staff had not seen any issues, but the bank would closely

monitor for any increases in network load. "Our biggest worry is around video

conferencing," said Ms Herranz.

Network issues were blamed on serious performance problems when several years

ago Google apps were introduced by the city of Los Angeles.

'Starting from scratch'

The biggest challenge for BBVA and other firms switching to cloud computing

could indeed be cultural issues.

The bank says it has a training programme in place - including personalised

guides - to prepare their staff for the move from their tried and trusted email

solution and other tools to the new browser-based online world.

However, the bank encourages its employees to leave all their old email and

data in those legacy systems. They will be accessible if necessary, but, says

Ms Herranz, but we "want to start from scratch... don't want to carry across

old behaviours".

"To move to the future, you have to leave the past in a box," said Ms Herranz.