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AWS eyes Australian government growth

Amazon Web Services is eyeing the Australian public sector for growth, with increased budgets and IT disasters in the past pushing government organisations towards the public cloud

Government technology disasters combined with a big increase in tech spending are helping carve out a several billion dollar opportunity for public cloud providers, such as Amazon Web Services (AWS) and Microsoft Azure, in the Australian federal government IT market.

Cloud giant AWS recently put on its annual Public Sector Summit show in Australia’s capital Canberra. As a measure of interest in public sector cloud spending, the summit has seen its audience grow from less than 100 bodies at the first Canberra show in 2013, to more than 1,000 at the latest event.

A large carrot for public sector cloud providers, such as AWS and rival Azure, is the dramatic increase in federal government tech spending, along with a push for government agencies – especially small to medium-sized – to consume more cloud rather than building their own IT infrastructure.

The Conservative coalition government has ramped up tech spending in recent years, taking it from around A$6.5bn a year under the former Labor government – which was voted out in 2013 – to around A$10bn a year today.

The coalition has described the big increase as being central to delivering good government and sees quick development and deployment of citizen services, helped along by more agency cloud consumption, as leading to greater efficiency as well as being a vote winner.

None of this has been lost on AWS, which was able to trot out a prize speaker for its cause in the form of prime minister Malcolm Turnbull’s cyber security advisor Alastair MacGibbon, a high-profile veteran of the Australian cyber scene.

In his speech at the summit, MacGibbon left no doubt that Australian government agencies should be looking at public cloud as an IT option. “Innovation is good, cloud is good, because it helps us move off legacy systems. Our biggest risk when we look at things is from legacy systems,” he said.

For its part, AWS is seeing burgeoning interest from government agencies, especially following some high-profile government tech disasters.

“Maybe a year ago, it would have been a theoretical discussion,” said Andrew Phillips, AWS Australia and New Zealand (ANZ) public sector country manager, in reference to selling to government agencies.

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But then came some very public government tech disasters, such as the Australian Bureau of Statistics’ systems failure on census night in 2016, and several embarrassing outages of the Australian Tax Office online systems that have, at times, made it impossible to lodge tax returns.

“Now we have examples where government people can see that if had they been working with AWS before [the events], the cloud could have helped them avoid being the next big issue,” said Phillips, who added that around 80% of government agencies in Canberra – including the separate Australian Capital Territory government – have some form of engagement with AWS.

Phillips said the opportunity for public cloud in Canberra for all cloud suppliers is of the order of “billions of dollars”, although he is unsure how quickly that size of market will emerge.

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