Cloud computing is expected to gain more traction in the financial sector, as more firms grapple with shrinking technology budgets. So, what’s the likely impact on IT roles?

It’s still a relatively nascent technology, but cloud computing is where processing, storage, networking and applications are accessed as services over virtual rather than physical networks, whether that’s public (via the internet) or private (within a company’s intranet).

There’s a lot of savings to be made by implementing the model, which is why financial firms – faced with complex, often disparate systems and shrinking IT budgets – are increasingly considering it, according to a new study by IBM and the Securities Industry and Financial Markets Association (SIFMA)

Rather worryingly, one of the motivations for this is the fact that banks are increasing constrained when it comes to taking on new people, so cloud computing helps to alleviate this need to some extent.

"Budgetary and personnel constraints are forcing firms to think about and look to new technologies, like cloud computing, that can provide the services they need in a cost effective manner," said Randy Snook, managing director and EVP at SIFMA.

However, Duncan Johnston-Watt, CEO of cloud computing software and services firm Cloudsoft Corporation, insists that the impact on development roles will be limited. While developers will need an appreciation of producing software to run within a cloud environment, it’s not going to produce a massive shift in the way they work, he says.

"However, there will be some degree of automation, which will inevitably eliminate people. But a lot that being eliminated will be drudge work," he says.

But there’s also an opportunity. Speakers at a recent Financial Information Services Division conference – which featured banks and financial software vendors – suggested cloud computing would be a key area to skill up in going forward.

"It’s about people having to adapt," says Johnson-Watt. "Any time there’s a new technology, there’s an opportunity. When SAP first came along, if you knew about it you could command a premium and VMware experts are being offered the same premium at the moment."