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Q&A: Sean Kelley, Deutsche Bank CIO, Believes Banks Belong in the Cloud

Sean Kelley, CIO of the asset management division and the platform services group at Deutsche Bank, yesterday became chairman of the Enterprise Cloud Leadership Council, a group of business leaders who are working on standards for emerging cloud technologies. At the end of the day, he graciously spent some time with Bank Systems & Technology to tell us about his new role and his thoughts on cloud computing.

Sean Kelley, CIO of the asset management division and the platform services group at Deutsche Bank, yesterday became chairman of the Enterprise Cloud Leadership Council, a group of business leaders who are working on standards for emerging cloud technologies. At the end of the day, he graciously spent some time with Bank Systems & Technology to tell us about his new role and his thoughts on cloud computing.BS&T: How do you feel about cloud computing - is it the Next Big Thing?

Kelley: Technology comes in waves, usually in decade increments - you had the mainframe, the minicomputer, client/server, desktop, the internet, mobile computing and so on. The buzzwords come and go, but this one I think will stick. The ubiquity cloud computing promises makes sense, the technology makes sense, the mindset makes sense, the economy makes sense.

Cloud providers make it their business to stay technically current, whereas a large corporation may need to intentionally stay a couple of revs behind for risk purposes. Why not take advantage of the cloud providers' sweat equity and let them provide the capacity and technology currency?

Also, time to market is better with cloud computing. If you provision a server in the old way, it can take months. A cloud provider can do it in minutes.

Enough planets have aligned that if cloud computing is played well, it has a strong future.

BS&T: Does cloud computing play a big role in Deutsche Bank?

Kelley: Yes. Financial services is a technology business. Anything that plays a major role in providing capacity, resiliency, and innovation is going to do well here. For instance, the movement to know your risk in real time is a huge strain on computing power, especially when you have big market moves and high trade volumes. These factors cause computing power needs to spike, and if you have to provide internal capacity at the highest spike level and then keep it around until you need it, that becomes inefficient. But if you can pierce the corporate membrane and extend it to third party data center cloud capacity that looks and feels like your own, and you can flow work in and out of the membrane to do things like calculate risk and process trades, that's huge.

BS&T: What is the purpose of the Enterprise Cloud Leadership Council?

Kelley: Our vision is to get users of cloud services together and clearly define what, how and when we want to buy technology. Otherwise the suppliers are left to a "Field of Dreams" scenario, in which they have to guess at what users want, and hope they will come buy their product. That costs the vendors money and us, frustration.

So the purpose of the ECLC is to be very clear about what we require, both technically and non-technically - for instance, the notion of licensing and license costs in the cloud is a different game [from traditional hardware and software purchases]. In a cloud, clients don't even know how many CPUs they're running on. Licensing and contracts need to be variable. The beauty of the cloud is when you no longer need extra compute capacity you can say, "I'm done - switch me off." As opposed to the old-fashioned way of provisioning servers, which is like Samsonite luggage - you have it till the end of your days.

This group is meant to work on these types of issues, but not as an esoteric, academic exercise. We plan to back up our standards with reference implementations and detailed prototypes contributed by the membership.

BS&T: This seems progressive, as financial firms have tended to be secretive about the technology they use, sometimes considering it their "secret sauce."

Kelley: The secret sauce, such as algorithmic trading programs, is always going to stay within the corporate membrane. But the computer stack it sits on is a computer stack - it could be used for defense, financial services, pharma, anything. It's just cpu, storage, network, database, whatever as a service, and you're driving your proprietary IP on top of it.

BS&T: What would you say to those bankers out there who are still worried about security and data privacy in cloud computing?

Kelley: These things get figured out. You don't sweep them under the covers. We're a fiduciary company, we have to think about security. So we're putting our shoulder to the wheel and doing something about it. In some use cases we've made cloud implementations as or more secure as our own internal stuff. We've created a "cloud envelope" that provides auditability and traceability. The financial industry has smart technologists. If you turn these people loose on these problems, they crack them.

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