“In Melbourne, we have clients who are just hampered, the NBN is a big issue and this affects our ability to sell services to these customers,” Zanghellini explained.
Through delving into specific sectors, similar challenges also remain, with the healthcare industry particularly relying on on-premise servers with cloud back-up, hosted exchange and disaster recovery technologies.
“I think that is starting to change as the landscape evolves,” UrbanIT managing director Matt Maher said.
For Maher, a “partial shift” to cloud technologies is underway however, although such a shift remains “highly dependent” on the speed of internet.
“Even though cloud services have matured and developed, businesses can’t take advantage because internet speeds are not up to scratch,” he said. “Businesses 5–10km outside of the CBD are still not able to receive a reliable internet connection.
“They may be a small medical practice and they can’t justify the cost of a fibre connection. This is the biggest inhibitor to change in our industry.”
At the big end of town however, the rollout of NBN has had “little to no impact”, with the enterprise market operating on private fibre networks, allowing a shift to managed services and outsourcing.
“We are seeing corporations looking to move their models to OPEX,” Thomas Duryea Logicalis transformation services general manager Damian Zammit said.
“But in government and healthcare sectors, the focus is still very much on CAPEX and that’s because state and federal funding still arrives in a big chunk."
Across all market segments, Zammit said the state is fast embracing business transformation strategies, underpinned by digitalisation.
“It’s not about IT, it’s not about supportability, it’s about the user and enablement of that user,” he explained. “They are looking for a single supplier that can create a digital strategy, execute a solution and manage those solutions deployed.
“We are seeing more managed services work because of these business transformation solutions.”
Flipping the conversation to NSW, a different scenario is playing out.
When UK-based Modality Systems decided to expand to Australia, the unified communications provider chose Sydney as the launching pad for its entry into the local market.
At first, it was a toss-up between Sydney and Melbourne for the Microsoft partner, with both cities playing host to large industry and potential customers.
In the end however, the NSW capital proved to have much in common with Modality Systems’ own home base near London.
“A lot of the large multinational banks, professional services firms and engineering firms that we already worked with had their Australian HQ in Sydney,” Modality Systems country manager for Australia, Justin Morris said.
“Melbourne definitely has a balance of that but Sydney made sense because of the global customers.”
For Morris, Sydney made for a soft-landing site for the company.
“Support from those global customers that Modality Systems does business with internationally coinciding with the local market entry really helped to bootstrap us initially,” he said.
Morris attributes the dominance of the financial and professional services segments in the Sydney market as being a major draw for the company’s decision to settle on the city as a starting point in the local region.
Since then, however, other top industries in NSW have started to come into the fold, with the provider picking up customers in the local media, public relations and communications sub sectors.
Escaping the Sydney sprawl however, Modality Systems is also seeing increasing rates of cloud adoption among organisations in regional centres, such as Newcastle, Wollongong and Port Macquarie, especially among government customers.
Given that Modality Systems’ solutions revolve around cloud capability, this positions the company well to tap the broader NSW market.
“What we are starting to see is customers seeking out smaller, nimble specialist partners that have expertise in what they’re looking to achieve, and then forming a long-term partnership with them,” Morris said.
And although Modality Systems recently opened its second Australian office in Melbourne, the NSW market continues to deliver.
“The market is substantial here,” Morris said. “There is enough opportunity. And the way that we differentiate ourselves is by being specialised.”
Reporting by Chris Player, Hafizah Osman and Leon Spencer.