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Duncan: 'Australian public sector is warming to cloud but technology gaps remain our biggest challenge.'

Duncan: ‘Australian public sector is warming to cloud but technology gaps remain our biggest challenge.’

Cloud-based procurement and spend analytics software provider cloudBuy has won a deal with an Australian state government to provide an e-procurement marketplace for the treasury and IT departments. Lyn Duncan, chief executive officer of cloubBuy told BCN that the deal is also a sign Australian government is starting to warm to cloud services.

The first phase of the project, which will run for the next six months, will see cloudBuy implement the end to end cloud-based e-procurement marketplace for a yet unnamed Australian state government and support the onboarding process of 20 key treasury and ICT suppliers.

The marketplace will also be integrated with the State’s SAP enterprise platform, enabling electronic invoicing and purchase order syncrhonisation.

“This is the first cloudBuy emarketplace to be signed in Australia and follows our earlier contract wins for spend analytics in this market,” said Ronald Duncan, chairman of cloudBuy.

“It is pleasing to report that there are a significant number of other similar potential customers in the pipeline,” he said, adding that the deal validates the company’s business model.

The deal will see cloudBuy, which partners with Visa for payments processing, receive a percentage of the value spent through the platform, which the company estimates will initially generate around $900,000 (AUD) but could reach up to $7.2m annually.

“License fees don’t really sit that well with the SaaS model, we’ve had years of fighting over this and it simply doesn’t work – it’s a bit of a bodge,” added Lyn Duncan, chief executive officer of cloubBuy.

Duncan told BCN the recently announced deal was driven by the state government’s need to save resources and consolidate its shared services platforms.

“It’s nowhere near where some European countries are in that sense but the government there has a strong programme of driving efficiency and savings in place because of the slowing economy,” she said.

She explained that the Australian public sector is starting to warm to cloud-based services, adding that there’s more pressure on Australian government to assess cloud-based services now than there was 18 months ago.

At the same time it’s clear that at the federal level there have been attempts to ease the cloud services procurement process as of late. It was recently revealed that the Australian federal government is mulling whether or not to drop a component of its cloud policy that forces public sector organisations to secure the permission from two government ministers to put certain kinds of data in the cloud.

“Even in the public sector in Australia they are more open and willing to take a risk than in the UK,” she said. “But the biggest challenge is also that in Australia, particularly in government, they’re about ten years behind the UK in terms of technology and implementation.”