The public sector has been slower to embrace cloud computing than the private sector. But there have been few statistical comparisons available of adoption rates, leaving the IT industry to wonder just how much further along corporations are in moving to the cloud.

According to a new survey released Tuesday, June 1, by computer processor developer AMD, 42 percent of private-sector organizations are operating on some level in the cloud, while 23 percent of public-sector organizations are doing the same.

Why the disparity? AMD executives told Government Technology there are a few factors in play. One is a lack of in-house cloud computing expertise within government agencies. Seventy-five percent of responding public-sector entities said they didn’t have the IT skills in place internally to support a cloud environment. Furthermore, 43 percent of the public sector currently using the cloud admitted they didn’t have the necessary skills yet either.

Another reason is that migrating to the cloud requires upfront investment without an immediate ROI. In fact, governments that want to move to a cloud environment should expect a two- to three-year “ramp up” period, said Steve Kester, head of U.S. government affairs for AMD.  The first year is typically dedicated to planning, and year two requires dual operations — on premises and in a hosted service infrastructure. Only after year three is an organization fully in the cloud and able to realize the savings brought by cloud technology.

And when the benefits come, they’re likely to be multifaceted compared to the private sector, which tends to focus on the bottom line, Kester said. A different metric is required to measure public-sector results such as operational efficiencies and improved service delivery. This complexity is likely a contributor to the public sector’s slower adoption of cloud computing, he added.

The delayed payoff can be a challenge for state and local governments, many of which are handcuffed by tight budgets and program mandates. Consequently most government CIOs are still in the process of evaluating cloud technologies, and need to find a real benefit before they move forward, said Rick Indyke, federal business development manager at AMD.

Security concerns also persist. Fifty-nine percent of the U.S. public sector saying they were concerned about security issues in the cloud. Thirty-seven percent said they feared the potential for data loss in the cloud.

Despite widespread interest in cloud computing, infrastructure must not be overlooked in the decision-making process, the executives said.  Eighty-six percent of respondents said the cloud vendor’s servers and software were an important factor in moving to the cloud. In a migration, public agencies often focus on services instead of hardware and architecture, Indyke said. But unless a provider has the right infrastructure, the service is likely to be inefficient, expensive unreliable and unsecure. And the reality is agencies will continue to use some of their own hardware even after moving to a cloud environment because some sensitive public data likely never will be hosted offsite.

AMD surveyed 1,500 private- and public-sector organizations from around the world. The pool included 1,000 surveyed in the U.S., a majority of which came from state and local government.

Another recently released survey appears to confirm AMD’s research on adoption rates. The CDW-G 2011 Cloud Computing Tracking Poll made public late last month also found that 23 percent of state and local governments “identify themselves as cloud users who are implementing or maintaining cloud computing” as part of an enterprise strategy. In addition, this survey found that 79 percent of state and local governments say they are using at least one cloud-based application.

Matt Williams Matt Williams  |  Contributing Writer

Matt Williams was previously the news editor of Govtech.com, and is now a contributor to Government Technology and Public CIO magazines.