news The nation’s largest telco Telstra has reportedly publicly stated that it wants to host Microsoft’s Office 365 software as a service suite from its own datacentre facilities in Australia, in a move which would finally put paid to data sovereignty concerns around the service.
The productivity suite is provided online from a number of Microsoft facilities located around the globe. Microsoft has never explicitly said where Australians access the data from, but it is believed that the company’s Asia-Pacific clients are serviced from datacentres in Singapore and Hong Kong. In Australia, Office 365 is provided to customers through a relationship with Telstra, or for some larger clients, directly from Microsoft.
However, a number of organisations — especially in the public and financial services sectors — have long expressed concerns around SaaS platforms hosted offshore, due to the issue of other organisations such as the US Government maintaining legal jurisdiction over their data. The Australian Prudential Regulatory Authority, which regulates Australia’s banks, is known to be concerned about the issue, as are central IT strategists within the Federal and State Governments. However, in a speech given yesterday at the Security 2011 conference in Sydney, Telstra chief technology officer Hugh Bradlow reportedly gave a signal that the situation could change.
“Our intention is to host the data in Australia,” iTWire has reported Bradlow as stating (click here for the full article), with the executive noting holding data in Singapore was only ever “an interim measure”.
The move comes as a number of other cloud computing and software as a service providers have recently signalled an interest in breaking their long-held approach to hosting customer data offshore and establishing their own datacentre facilities in Australia.
Salesforce.com and Amazon have both flagged interest in the area in recent months, and Oracle has taken things a step further — providing its CRM on Demand software from a datacentre based in Sydney through a partnership with local company HarbourMSP. Google remains one of the largest software as a service companies which has not taken a step towards establishing local facilities, with its Apps suite (including the Gmail email platform) continuing to be hosted offshore, with no sign of local infrastructure on the horizon.
I have absolutely no doubt that Telstra wants to host Office 365 from one of its Australian datacentres. And I have absolutely no doubt that Microsoft will fight it tooth and claw to stop this happening.
It’s not very visible to the public. But all of Microsoft’s global cloud computing and software as a service technologies are provided from its Global Foundation Services infrastructure. And when I say everything, I truly mean everything. This is a global infrastructure cloud which the company uses for everything from soup to nuts — Windows Live, Xbox Live, Office 365, etc. This infrastructure literally serves hundreds of millions (if not billions) of people every day.
Having established this incredibly impressive and powerful cloud, it would simply make no sense for Microsoft to hive off a portion of its infrastructure to Telstra to achieve a limited set of aims in a small market like Australia.
Having said that, the demand for data to be hosted on-shore in Australia is real, and I wouldn’t put it past Microsoft to eventually make moves in this direction. But I don’t expect it to be in the sense that Microsoft will establish an “Australian datacentre”, or similar.
Instead, what I expect could happen is that Telstra could take delivery and implement one of the Windows Azure appliances which Microsoft has been partnering globally with Fujitsu on. While not technically Microsoft Global Foundation Services infrastructure, these appliances will allow local partners to mimic much of the same functionality which Redmond’s global cloud provides.
Setting up such a system locally would allow Telstra to provide a limited set of ‘premium’ services to customers hosted locally, while providing most of the rest of the market with the standard global Microsoft offering. Having their cake and eating it too, so to speak ;)