New CloudCentral GovCloud Serves Australian Cloud First Initiatives

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Kristoffer Sheather started Australian cloud company CloudCentral in 2010 after he noticed there was a lack of local cloud solutions for the Australian government and enterprise markets. As demand for cloud services in these markets continues to grow exponentially, the WHIR spoke with CloudCentral CEO Sheather on Wednesday about its plans to address needs of these mission-critical customers through new services and partnerships.

This year has introduced a lot of change for CloudCentral, including a recent restructuring, a reverse takeover of Dromana Estate Limited on the ASX and signing four new business partners.

The reverse takeover raised $400k of pre-acquisition capital. “We chose to go the reverse route because it’s easier for us to actually do it,” Sheather said. “The corporate advisor that we had working with us approached us in November or December with the idea, he had a bunch of shells that were candidates for the reverse listing lined up already and it would just make the process easier and enable us to get some capital before the actual listing.”

In late April 2014, CloudCentral received even more funding from Dominet Digital Corporation. Domenic Carosa is the head of Dominet and the co-founder of Australia’s only Internet-focused pooled development fund, Future Capital Development Fund.

“CloudCentral meets all of our investment criteria as a scalable investment opportunity operating in a rapidly growing market. I’m glad that we have come to terms on our participation. As well as proving funding, we look forward to partnering CloudCentral on its expansion by adding strategic input, relationships and operational support,” Carosa said in a statement. “The cloud computing market is undergoing a rapid adoption in Australia at the moment with Australian businesses expected to spend $US3.4 billion (AUD$3.7 billion) on public cloud computing services this year, a figure that will grow to $US5.3 billion by 2017.”

“Dominic is a well known successful entrepreneur…he’s made an investment into the company and he is now our advisory board,” Sheather said of the partnership. “He’s got a lot of experience with mergers and acquisitions, which I think is going to be playing an important role in what we have planned.”

Among other initiatives at the company, Sheather is planning for future growth and expansion to allow CloudCentral to better serve the Australian market. “We are  looking at strategic acquisitions where it makes sense for the business to grow in that way and Dominic’s experience with that will prove invaluable…I can’t give you any specific company names but we’re looking at VPS providers, managed service providers, networking companies, that sort of thing.”

Sheather sees a huge business opportunity in the move to cloud. CloudCentral has done a lot in recent months to position themselves to take advantage of Australian businesses adopting cloud services. “We’ve gone through a bit of restructuring and we’re working on our new government cloud and trying to get some things up in the financial services cloud area as well,” said Sheather. “We’re looking at what we call community cloud for organizations with similar shared security and support requirements.”

Following the trend towards rapid adoption of cloud services, both the Australian federal government and Queensland government recently issued “cloud first” mandates. CloudCentral is ready for the Australian cloud first initiatives with a brand new product offering.

“We’re constructing a government community cloud call CloudCentral GovCloud. It’s effectively a community specifically for Australian federal, state and local governments, departments and agencies and business enterprises to use. We’re actually building that in Canberra at the moment and we’re onboarding our first customer onto it next week.” Sheather told the WHIR CloudCentral expects to announce the name of this first customer next week.

“It’s a federal government agency. We’ve had a threat and risk assessment done by a security consultancy called Saltbush Group, to ensure that the environment meets the requirements of the Australian Government Information Security Manual, ISM. So we’ll be launching that as a new product in June,” Sheather said. “That’s our biggest initiative towards the government, giving them a dedicated environment that only government customers go into that meets the security requirements that the government demands.”

Like many countries, Australia has the need for a local data center to ensure data sovereignty and security, especially when dealing with the government but also other agencies. Being an Australian company with its data centers located in Australia gives CloudCentral a competitive advantage over US companies.

“From the security point of view one thing that the US providers can never be is an Australian company,” Sheather said. “Ultimately it’s up to the customer and we’re really guided by what the customer wants to do but we’re certainly espousing the benefits and virtues of keeping everything in Australia with an Australian company, not having any risk of being subject to US legislation.”

As it addresses the needs of the Australian government with this new offering, CloudCentral is also exploring other areas into which it can expand.

“We’re looking at opportunities to build other community clouds such as the financial services industry, healthcare and cryptocurrency money and services,” Sheather said. “As a general matter of principle we’re trying to do things that are harder than the average commodity you know, Amazon-type services or what we call commodity cloud. We want to do secure, managed cloud services and then tailor specific product offerings to specific vertical markets like healthcare, financial, government, but you know they all have common governance and security requirements and obviously function. It’s mostly about security and governance for those guys and that’s where I think providers in general can differentiate themselves from the ferocious red oceans of the Amazon commodity cloud offerings and the relentless price pressure.”

Sheather will share his expertise at the upcoming HostingCon Australia Symposium in Sydney, Australia on Aug. 4, 2014 at the Novotel Sydney Central. The session will discuss how using a wholesale cloud enables a cloud and hosting services business to save money, reduce deployment time, increase service quality and create a unique value proposition.

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