If There's a New Twist in Cloud Computing, Will Someone Tell Me What It Is?

Cloud computing appears to be the rage, except for the top six bank core vendors

I noticed the cloud buzz about five years ago, but I have never seen a press release from FIS, Fiserv, Jack Henry & Associates, Inc., Open Solutions Inc. Harland Financial Solutions, or Computer Services, Inc., with the term "cloud computing" mentioned. What do you think that means? Here are some possibilities: I don't read every press release so I could have missed it. Cloud doesn't apply to banking. Bank core vendors are too busy with conventional offerings. R&D money has already been committed to other priorities. Been there done that.

I believe the last reason is the true one. From what I have been able to determine, cloud computing is a version, not a first-time capability, of what bankers have been doing since the late '50s -- hire expert resources to provide tech solutions to perform the transaction processing needs of banks. If that doesn't say it all, here are some of the pre-cloud labels that were, and are still used, in banking:

Service bureau

Facilities management

Third-party processing

Remote processing (RJE)

Outsourcing

Software as a Service (SaaS)

If there is a brand-new twist in cloud computing that I missed, I wish someone would tell me what it is. What I can define for core vendors is what they can do under the heading of outsourced tech services. There are 19 core service providers in Automation in Banking - 2011. Even though I don't speak for them, this is what I know most of them can do.

1. Provide scalable services for any size financial institution priced according to workload and/or amount of time used.

2. Provide Internet-enabled solutions.

3. Provide services based on vendor-proprietary applications or customer-supplied software.

4. Provide services at all levels -- enterprise, department, employee, customer.

5. Provide online services routinely as expected by the financial institution as well as on demand for ad hoc requirements.

6. Provide services at any location.

7. Provide do-it-yourself services.

8. Provide 24/7 support services.

With half the U.S. financial institutions dedicated to the outsource mode of processing, I don't believe any of them are rushing to market to purchase a cloud. Unless an imaginative IT marketer calls it a "mobile cloud."