Tech cost pressures fuel demand for specialty cloud industries

The system developed by Microsoft Corporation

helped develop the healthcare-specific information systems needed to integrate St. Luke’s IT platforms and capabilities across a network of a dozen hospitals and more than 300 outpatient sites, Mr. Brisdin said.

Unlike general-purpose cloud systems, Comes with general enterprise applications and functions that need to be customized for industry-specific tasks, So-called industrial clouds provide purpose-built digital tools for companies within an industry.

Designed to easily integrate unique data from one end of a business to another, industrial clouds are especially useful in areas such as regulatory compliance for financial services firms or healthcare providers that securely share lab results and diagnostic and medical data across departments.

As companies face uncertain business conditions in the coming year, interest is increasing as CIOs and other enterprise technology leaders reexamine their cloud budgets.

According to analysts, industrial clouds offer the promise of cost-effective efficiencies as they offer more services than traditional industry data collection and analysis, as well as workflows and interactions with supply chains, customers and business partners.

Executives can start investing in technology that helps them. [to] “This is what industrial clouds are designed to do,” said Nadia Ballard, manager of cloud research at industry research firm International Data Corporation. Sustaining business growth by optimizing costs.

Gartner Inc.,

The IT research and consulting firm expects companies worldwide to run more than half of their critical business technology in the industrial cloud, with less than 10% in the next four years by 2021.

For large enterprise cloud providers such as Microsoft, Oracle Corporation

International business machines Corporation

and Salesforce Inc.,

Rising demand for industry-specific cloud could pave the way for new growth as cloud sales begin to slow.

“Cloud providers view industrial clouds as strategic as they fight for every last dollar of revenue,” said Lee Sustar, principal analyst at Forrester Research. Inc.,

IT research and consulting firm. But he cautioned that industrial clouds are a relatively new product in the enterprise cloud market, and not all industrial-cloud technology is mature enough to achieve all the benefits envisioned by the big cloud vendors.

Most industrial clouds started hitting the market early last year, partly due to the demand for better healthcare information systems in 2020 during the Covid-19 pandemic.

Oracle currently has more than 100,000 enterprise customers using industrial clouds built in healthcare, retail, financial services, hospitality, food and beverage and other sectors, said Oracle CEO Mike Sicilia. Oracle said it began developing industrial cloud tools long before the outbreak.

“In general, technologies developed for industries are better than one size fits all,” Mr. Cicelli said. “What a major pharmaceutical company needs to bring new treatments to market is not the same as what a telco needs to deliver text messages — or what a restaurant needs to convert to a hybrid takeout and dine-in model.”

Last week, Oracle reported stronger-than-expected second-quarter revenue of $12.3 billion, an 18 percent year-over-year increase, which the company said was boosted in part by sales of the healthcare industry cloud. The system includes new services from Cerner Corp., a cloud-based electronic-medical-records developer that Oracle acquired this year for $28 billion.

Although Oracle does not generate revenue from industrial cloud sales, its industrial cloud offerings are “a multibillion-dollar business,” Mr. Cicelli said.

Microsoft has rolled out industrial clouds for retail, financial services, manufacturing, sustainability and nonprofit businesses in the past year, said Kees Hertogh, general manager of Microsoft’s global industry product marketing.

“Customers tell us that the cloud services we offer must support the unique needs and challenges of their industry,” said Mr. Hertog, adding that there is a growing need for talent to monitor patients remotely, streamline the credit process online or assist with curbside pickup. Services.

An industrial cloud developed by Microsoft helped Tarrytown, NY-based MVP Healthcare implement a system to streamline its healthcare data, said CIO Michael Della Villa. Customizing a standard cloud-based data store for a variety of sensitive patient data would have been a longer, more expensive project; he said.

By improving and integrating data capabilities, the industry-specific platform has helped to “break down the contrast of care” and more effectively use data to address patients’ physical, behavioral and socio-health conditions, said Mr Della Villa.

Caixabank’s Chief Technology Officer Alberto Rosa said that unlike traditional cloud systems, the financial services cloud developed by IBM allows the bank to “meet the strict requirements faced by highly regulated businesses.” Based in Valencia, Spain, Caixabank operates more than 5,300 banks and 14,400 ATMs in the southern European country, serving 20 million customers, the bank said.

Write to Angus Loten at Angus.Loten@wsj.com