Eduserv, a registered charity, has won a two-year Bristol City Council cloud computing contract via G-Cloud.
According to the announcement, the £1.5m contract entails outsourcing of daily IT requirements as well as data hosting to managed services provider Eduserv, which operates on a not-for-profit basis and is also a registered charity.
Andrew Hawkins, sales director at Bath-based Eduserv, said the public sector-focused services provider had worked hard to develop a suitable cloud proposition for local government.
"It allows organisations to choose the right mix of IT and professional services," he said. "The benefit of having our own datacentre is that local government can free up its real estate immediately, by co-locating in our datacentre and migrating to the cloud in a controlled environment."
Steven Pendleton, service manager for commissioning and supplier relationship management at Bristol City Council, said moving to the cloud and IT commoditisation makes "economies of scale" possible for the organisation, which is seeking to cut costs by a third.
"Like every council, we are faced with the challenge of delivering high-quality services while reducing our costs," Pendleton said. "The council will not need to own much of its ICT in future; it will buy services that match demand in a much more flexible way."
The IT infrastructure migration is happening in tandem with a council-wide building consolidation programme.
Eduserv's website confirms the supplier's primary concern is not profit: "It's providing extraordinary value and results for our customers."
"Eduserv is a different kind of IT provider. Because we're a not-for-profit organisation and a registered charity, we don't have to focus on making a profit for shareholders like most IT companies," it reads.
It has helped with the IT needs of organisations including the British Red Cross, the Department of Education, and the Citizens Advice Bureau.
Eduserv's 31 July 2013 annual report explains that one goal is to support the advancement of education, including improved use of IT in education institutions.
Being a charity, it uses different terminology in its annual report and has to abide by different legislation. For-profit channel companies may be interested in its cost structure.
Net income for the year fell six per cent, making for a resultant trading deficit of £529,000 compared with the year ending 31 July 2012, when it made a £324,000 surplus. That deficit was prior to a £261,000 restructure in the year just gone.
Other costs during the 2012-13 year included £27,000 for trustee expenses and recruitment costs – boosted by £510,000 in investment income and gains, leaving Eduserv Technologies Ltd officially in surplus with £412,000, from annual revenue of £23.5m.
Its 132 employees that year generated £6.9m in salaries or wages, including pension contributions and social security costs, the report said.
Ten staff earned between £60,000 and £70,000 per annum, and the highest-paid in the organisation took home between £130,000 and £140,000 that year, the report said.
"Continuing reductions in public expenditure mean that Eduserv can only maintain or grow its current level of services and income through replacing existing for-profit providers," the report – signed by chairman Paul Layzell – confirms.
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