IT managers in financial service companies are to escalate their reliance on datacentre outsourcing, according to research by analyst BroadGroup.
Based on in depth interviews with financial services institutions ranging from small banks to global investment companies, the report provides an analysis of what third party datacentre providers need to do to win business from European financial services companies.
The report, ‘IT outsourcing to 3rd parties by financial service companies in Europe’, says “a significant round of migration to third party outsourcing will occur over the next two years”.
Among the factors for this migration are new regulatory pressure and the belief that the impact of MiFID financial directive has been underestimated, as well as the expectation that the data explosion will continue.
As new trading algorithms and financial products become ever more complex, data needs will accelerate, said respondents.
Power, cooling and lack of space in datacentres are also identified as critical factors, said financial firms.
Firms said datacentre space and power would become increasingly important over the next 12 months, and many have concluded it is preferable to bypass the problem and outsource, said BroadGroup.