Howard Boville is a happy banker. He is Bank of America’s chief technical officer and has saved his company close to $2.4 billion in infrastructure costs this year after moving 75 percent of their IT applications to BoA’s private cloud network.
Well known for being a tech trendsetter in the financial services sector, BoA began their great cloud migration in 2013 with the ambitious goal of accomplishing 80 percent cumulus-based by the end of 2019. Fast forward seven years and they are well positioned to meet that goal with 75 percent of all applications off their legacy system.
With the trend towards the ever-scalable, ever cost-effective public cloud, Bank of America’s decision to go private might seem counterintuitive. But according to the bank’s previous CTO, David Reilly, the numbers to go public didn’t add up.
“When we benchmark the price points in the public cloud against what we’re able to provide internally – and we have years of benchmarking under our belt now – the economic delta’s just not there yet,” Reilly said in a 2016 interview. “There’s no economic reason for us to move to the public cloud.”
Reilly also pointed to the benefits of being able to secure data on a private network and having access to capacity when they needed it. Much has changed since 2016, however, and the cloud space has come a long way. Does the current CTO Howard Boville believe that a public cloud would serve his company better? The answer is still a resounding nope.
The benefits of a private cloud over conventional databases are significant. In essence, a private cloud uses software to link data center hardware together into an integrated virtualized computing platform. This united-we-stand approach allows BoA to ‘pool resources’ and scale up or down with demand. Boville has said the bank is currently using 10,000 physical servers for 75 percent of the workload while the remaining 25 percent requires five times that number of servers to run.
The other advantage, Boville explains, comes from the ability to access data across a wide breadth of the financial institution’s operations. The bank now has a better sense of how their customers are interacting with their services – no small feat when there are 26 million of them daily on the consumer-side alone. This is, in large part, due to the fact that most applications are running on a cloud network and no longer parked on fragmented systems spanning the country.
As part of their transition, BoA opted to go with Microsoft’s Azure software. Apparently, that’s what all the cool corporate kids are doing because “95 percent of Fortune 500 companies trust their business on the Microsoft cloud” – according to Azure’s website.
“We are aggressively modernizing our technology infrastructure to enable current and future growth across all our lines of business,” Boville said in a 2017 press release. “Our agreement with Microsoft aligns to our target of delivering 80 percent of our technology workloads on virtual platforms within the next several years, further establishing Bank of America as a digital leader in financial services.”
The bank started their cloud migration seven years ago as part of a massive $3 billion technology infrastructure update. They transitioned from a hardware-focused strategy to a software-defined technology. In addition to the $2.4 billion in infrastructure cost savings, Boville anticipates an additional $100 million in savings will come through advancements in both cloud and on-premise technology over the next three years.