The shift to the cloud is well underway as organizations are adopting cloud service providers at an increasing rate year over year. With more capital pouring into the sphere every day, it’s only a matter of time before cloud solutions completely dominate the digital landscape. According to Gartner, public cloud spending will overtake traditional enterprise IT spending by 2025. Research analysts note that public cloud spending within the enterprise IT categories of application software, infrastructure software, business process services, and system infrastructure markets will encompass 51% of total spend versus traditional solutions. This signifies that the cloud shift is in full swing, and initiatives such as the acceleration of digital transformation will only increase cloud adoption.
“Technology and service providers that fail to adapt to the pace of cloud shift face increasing risk of becoming obsolete or, at best, being relegated to low-growth markets.”
Michael Warrilow, Gartner
The latest cloud strategy report from McKinsey backs up the data from Gartner. Out of the 50 tech executives interviewed, the majority agreed that more than half of their applications would be in the public cloud in three years. Although tech executives are aligned on the shift to cloud solutions, overall their cloud aspirations differ. They fall within four distinct categories:
- “Those planning to exit or almost entirely exit their data centers, with aspirations for 90–100 percent adoption
- Those planning for cloud to be the dominant hosting platform, complemented by material data-center co-location capacity4
- Those aspiring to have a roughly 50–50 balance between cloud and on-premises hosting
- Those planning to develop new capabilities and migrate targeted applications to the cloud, with aspirations for hosting 20–35 percent of their applications in the cloud”
Organizations are not limiting themselves to one cloud service provider (CSP) but most are planning to use two or more CSPs. In a multiple cloud environment, CSPs will not share equal footing. Many organizations anticipate having one dominant CSP and a few others for specialized functions. This allows them to curate individualized experiences so that each solution gets the appropriate service to meet its corresponding needs. For example, customer relations applications may get one CSP, while analytics applications may get another.
Multiple clouds, while providing flexible and cost-efficient solutions, still pose security risks. Data vulnerability increases, security complexities rise, and compliance needs become more expensive. In Cisco’s 2022 Global Hybrid Cloud Trends Report, experts note that “without a common framework to manage them, security teams need to develop fluency in each new cloud – a significant investment in time and resources.”
To remedy this, experts recommend organizations adopt a unified operations model to streamline multi- and hybrid-cloud strategies and reduce strain on resources. Many organizations are also moving to hybrid cloud models with applications moving between on-premises and off-premises environments to improve business agility and better serve their teams. Hybrid cloud models provide flexibility, but they can be complex and expensive. According to Cisco, “proactive and consistent collaboration between cloud operations, networking, and DevOps teams can help ensure security, efficiency, and agility.”
- Cloud Budgets will Encompass 51% of Enterprise IT Spend by 2025
- Half of all Applications will be in the Public Cloud in Three Years
- Organizations are not Limiting Themselves to One Cloud Service Provider
- Multiple Cloud Environments Pose Security Risks that Need to be Mitigated
Sources:
Five learnings from CTOs and tech leaders on their cloud strategies
