Can cloud computing catapult NZ onto a global stage?

Want to go offshore and reach a large online market in a hurry but don’t have capital to buy the necessary IT hardware? The cloud is your answer. There’s one obvious drawback: you may never know at any given minute where in the world your data is. And cloud computing is both deceptively simple and terribly complex.

It was hard to miss the hype towards the end of last year. According to the Economist, there’s nothing the computer industry likes better than a big new idea — followed by a big fight, as different companies compete to exploit it. Every man and his dog know this is a big play and they’re all fighting to get aboard. The usual suspects are there — Microsoft, Google and a bunch of players who want to provide storage or cloud services.
And that well-known IT company, Amazon. Yes, the online retailer has become a major player in the cloud.
When Dunedin-based TicketDirect said it planned to take on the global giants of the ticketing world using Microsoft’s new Azure cloud computing platform late last year, it seemed like the perfect Kiwi confluence between startups or fast growth companies and the cloud.

What is the cloud? Basically the cloud is the internet and cloud computing is a model of computing where services and applications are hosted on and accessed through the internet.

“We give one label — the cloud — to a huge variety of different services meaning everything from an outsourced platform at the lower end of the scale through to completely outsourced software as a service,” says Cisco country manager Geoff Lawrie.

What it does for TicketDirect is give the company the ability to scale operations at an incredible rate.
It’s the scale fast or fail fast scenario, says Chris Auld, director of strategy at Intergen, which has helped TicketDirect with its Azure deployment.

“Take a startup business with a brilliant idea and venture capital funding. The time comes to deploy and you have two options. You either go back to the venture capitalist and say ‘we need $100k to put in some servers’, and they say ‘that’s great but we’ll take another 30% of your company’, or you go to the cloud and it costs you $100 a month and if you do really, really well then two months down the track it may cost you $1000 a month to use those servers. But that’s okay because you’re making $20,000 a month and if you do really badly then you turn it off and take some other option and you’re not left with a grumpy venture capitalist with $100,000 worth of server hardware sitting around to dispose of.”

That elasticity and ability to scale, which appeals to TicketDirect, is the beauty of the cloud, says Auld. But as yet he thinks New Zealand companies haven’t quite grasped what is available and its potential. “They don’t quite understand the elasticity story.”

If you want to pick a fight in business, try taking on Ticketmaster, the US giant that squashed alt rock band Pearl Jam like a fly when it tried to boycott the ticketing company.

TicketDirect founder Matthew Davey is unfazed. “It’s really the Holy Grail of the ticketing industry and for us as a New Zealand ticketing company fighting the big guys, our multibillion-dollar competitors, it gives us that first-mover advantage. And from that standpoint moving into the cloud overnight gives us more capacity than Ticketek in Australia or Ticketmaster in America. It’s pretty amazing stuff.”

By renting servers from Microsoft’s huge server farms, TicketDirect can coast along, selling around 6000 tickets a day, then crank up to sell 100,000 tickets in 90 minutes.