Australian businesses could save up to $125 billion a year or $625 billion over the next five years if it shifts to cloud computing, Cloud Accounting Australia review of case studies said.

"Cloud software is an opportunity for small and medium businesses to use state-of-the-art technology with very low operating costs. Over the next few years, we expect to see a range of businesses reducing their operating costs by moving their bookkeeping, accounts and financial reporting online," Cloud Accounting Australia Chief Executive Officer Michael Kuster said in a statement on Friday.

Cloud Accounting Australia is a provider of cloud accounting solutions which it claims cost lower than services offered by traditional accounting firms. The firms said that general tax compliance work is fast becoming a commodity which it could offer to clients as part of its value added services.

The firm cited studies by Trend Micro that cloud computing also offers higher security benefits, while another study by IBM said virtual servers cut operating costs for IT hardware as infrastructure.

It also pointed to a Microsoft cast study which indicated lower time and cost for companies with cloud IT deployment and management activities as well as it frees up resources to instead support a more agile and responsive organisation.

In some case, the average savings of 25 per cent across IT services was achieved which translates to $125 billion annually.

Another study by research firm Frost and Sullivan found that 70 per cent of all Australian businesses with cloud computing services plant to hike their cloud-based solution budgets significantly over the next 12 months.

The report, released Tuesday, said another 53 per cent of Aussie firms using cloud computing services spent more than 10 per cent of their total IT budget on cloud computing while 31 per cent spent more than 20 per cent.

Mayank Kapoor, cloud computing analyst of Frost Asia-Pacific ICT Practice Datacentre, disclosed that most of Australian organisations are now fully cloud deployed rather than implement it in pilot phases, particularly in the areas of storage and computing solutions.

He added that software-as-a-service is the most commonly used deliver model for cloud computing, but infrastructure-as-a-service gained significant adoption in the past 12 to 24 months.

In April 2011, the Australian government finalised its Cloud Computing Strategic Direction Paper and released the draft of its ICT Strategic Vision which it presented for public consultation. The vision encourages innovation through the examination and adoption of new and emerging technologies more rapidly.

The paper estimated that the Australian government spends $4.3 billion yearly on ICT through traditional computing services delivered through desktops, laptops or mobile devices run by proprietary software. By developing a data centre strategy for the next 15 years, Canberra could save $1 billion. One initiative being eyed to cut the demand for data centre capacity for government agencies is to develop cloud hosted end-to-end services targeted to the public sector.

The paper identified four Australian public agencies which have pilot cloud computing services, namely the Australian Taxation Office, Australian Bureau of Statistics, Treasury and the Department of Immigration and Citizenship.

RELATED STORIES