IDG Communications has assessed the cloud spending patterns of customers through in-depth research profiling readers of CIO, Computerworld, CSO, InfoWorld, ITworld and Network World publications.
All brands operate as sister publications of ARN, Reseller News and Channel Asia across Australia, New Zealand and Asia Pacific respectively, offering the channel unique insight into the cloud strategies of end-users.
With an audience representing key IT and security decision-makers across multiple industries—spanning six IDG brands—the results are based on 550 customer respondents.
Under the banner of 2018 Cloud Computing research, findings show that organizations continue to increase investment and evolve cloud environments in order to drive growth through the business.
With 73 percent of customer having at least one application, or a portion of computing infrastructure already in the cloud, it’s no longer a question of if organizations will adopt cloud, but how.
Customer complexity = partner opportunity
The overall sentiment of the research centers around a cloud market that is maturing at pace, but growing more complex in parallel.
Such customer complexity is creating pockets of opportunity for partners to capitalize, through the offering of consultancy services, the creation of applications and the delivery of tailored solutions.
Currently, 43 percent of customers are using hybrid cloud only, while 12 percent are using multi cloud only and 30 percent are using both.
The perceived benefits of using multi cloud include: increased cloud options (59 percent); easier and faster disaster recovery (40 percent); and increased flexibility by allowing the spread of workloads across multiple clouds (38 percent).
Despite business stakeholders realizing the benefits and results of cloud adoption, more than one third of IT departments (38 percent) feel pressure to migrate 100 percent to the cloud.
Enterprise organizations—housing more than 1,000 employees—are carrying the pressure more than mid-market counterparts—housing less than 1,000 employees.
Specifically, 44 percent of enterprise organizations, compared with 31 percent of mid-market organizations, feel pressure from executive management or individual lines of business to migrate 100 percent to the cloud.
The evolution of more complex environments has also generated the need for, or discussion around, viewing cloud providers as a portfolio, with 51 percent of customers beginning to think this way.
Delving deeper, organizations in technology-dependent industries are much more apt to be thinking of cloud providers within a portfolio strategy: financial services (63 percent) and high tech (63 percent) top the list, and manufacturing (43 percent) and education (41 percent) are least likely to be thinking of cloud providers within a portfolio strategy.
“IT organizations are being asked to improve the speed of IT service delivery and react to changing market conditions,” said Julie Ekstrom, senior vice president of IDG Communications. “Cloud solutions provide the flexibility to do just that. Organizations are relying on a mix of cloud delivery models to meet this need; however it requires management of multiple vendors.
“As tech executives explore new areas of cloud investment, they examine their portfolio of cloud vendors to see what solutions can grow and what new vendors will work collaboratively with their existing portfolio for ease of adoption.”
Of note to partners, the percentage of IT budgets allocated to cloud computing has remained relatively consistent at 30 percent, compared with 28 percent in 2016.
Given that cloud consumes a substantial portion of tech spending, it is not surprising that the CIO or top IT executive is the most influential role in the cloud computing purchase process.
Overall, 71 percent still carrying significant influence, with the next function/role dropping to 54 percent saying the CTO has significant influence.
For mid-market respondents, the CEO is also influential (72 percent), and for enterprise organizations the number two spot is taken by the CSO and IT architect (both at 87 percent).
Delving into the technical aspects of the study, the make-up of IT organizations’ computing environment—the percent of environments made of the mix of non-cloud, SaaS, PaaS and IaaS—is split fairly evenly between non-cloud and cloud but that is expected to change.
Currently the average environment is 53 percent non-cloud, 23 percent SaaS, 16 percent IaaS and nine percent PaaS.
Over the next 18 months, customers expect this to evolve to 31 percent non-cloud, 33 percent SaaS, 22 percent IaaS and 14 percent PaaS.
The two biggest factors driving the adoption of SaaS benefit the IT team within organizations—less time spent on manual updates/maintenance (62 percent) and increased productivity/decreased labour time (55 percent).
The next two factors—greater access and reliability, and enhanced user experience (both 53 percent) have a direct benefit to end-users.
Meanwhile, savings on server and storage overhead (56 percent) and no longer having to manage updates and maintenance (51 percent) rank as the top objectives driving the adoption of PaaS, with scalability the top factor driving the adoption of IaaS (68 percent) followed by flexibility (53 percent).
Furthermore, the top applications organizations have/or currently are moving to the cloud are website/web apps (49 percent) and collaboration and communications solutions (45 percent).
Top applications in the planning stages—those that will be migrated either in the next 12 months, or 1-3 years—are disaster recovery/high availability (49 percent) and business intelligence / data warehouse and analytics (45 percent).
This is followed by storage / archive / back- up / file server (44 percent) and system management / DevOps (42 percent).
Customer concerns about vendor lock-in (47 percent), where data is stored (34 percent) and the security of cloud solutions (34 percent) remain the top challenges or barriers to implementing a cloud computing strategy year-over-year.
Yet the results show a steady decline in security concerns—from a high of 67 percent in 2015 to 34 percent.
Two other security or governance concerns also appear to be decreasing over time as cloud offerings have matured, driven by compliance and the ability of cloud solutions to meet enterprise and/or industry standards (was at a high of 35 percent in 2015 and at 26 percent in 2018).
Concerns around information governance (eDiscovery and other information management requirements) ranked at a high of 35 percent in 2014, before dropping to 23 percent in 2018.
“As comfort with cloud security rises it is not surprising that organizations are looking for additional ways to integrate those models into their tech stack,” Ekstrom added.
“While colleagues through the organization may introduce cloud applications, the role of strategic oversight and vendor management must sit squarely with IT.”