State of the Magazine, State of the Market

Silver Lining

State of the Magazine, State of the Market

By Paula Bernier, Executive Editor, TMC  |  October 31, 2016

Hello. Welcome to my inaugural effort at the Silver Linings column, which I have taken over as part of my new post as the editorial lead on Cloud Computing Magazine.

For those of you who don’t know me, I joined Technology Marketing Corp., the parent company of Cloud Computing Magazine, as executive editor in 2009. I previously served as editor in chief at competitive local exchange carrier magazine xchange. Prior to that I was a senior writer at Inter@active Week. And I got my start in tech media at Telephony magazine back in 1990.

The communications and computing industries sure have changed significantly since I first got into this business. Back then the telephone companies moved at rather a slow pace, as at the time they had the luxury of ruling the roost, so they didn’t have anything much to run from or toward.

But now the communications services providers formerly known as telcos and cablecos are embracing the data center architectures that have enabled their over-the-top competitors like Amazon, Facebook, and Google (News - Alert) to be more agile and cost efficient. (For example, there’s a new effort within the Linux Foundation called CORD, or central office rearchitected as a data center. Meanwhile, the telcos are now embracing network functions virtualization, following the success of virtualization in the data center.)

And all of the above players, as well as long-time hardware and software players like IBM and Microsoft (News - Alert), and various other companies, continue to vie for position in this increasingly cloud-centric world.

AWS leads the cloud infrastructure service provider pack with 30.4 market share, while Microsoft Azure, Google Cloud Platform, and IBM (News - Alert) SoftLayer are the other three big boys in this space. Spending on new cloud infrastructure services grew 52.3 percent between the second quarter of 2015 and the same quarter this year, when it hit $9.5 billion, according to new data from research group Canalys.

The cloud has enabled enterprises and small and medium businesses to more easily and affordably acquire the communications and computing resources they need to be more competitive. That’s because the cloud allows for shared but secure resources in multi-party environments. With the cloud, everybody wins, given the decreased strain on users’ IT departments; just-in-time scalability; and, according to some sources, lower costs. But the argument for moving to the cloud is less about actual cost savings and more about the ability to quickly and easily spin up the necessary resources to support new services.

According to the Worldwide Semiannual Public Cloud Services Spending Guide published by International Data Corp., worldwide revenues from public cloud services are expected to reach more than $195 billion in 2020.

“Cloud software will significantly outpace traditional software product delivery over the next five years, growing nearly three times faster than the software market as a whole and becoming the significant growth driver to all functional software markets,” said Benjamin McGrath, senior research analyst for SaaS (News - Alert) and business models at IDC. “By 2020, about half of all new business software purchases will be of service-enabled software, and cloud software will constitute more than a quarter of all software sold.”

What belongs on the public cloud and what functionality is better kept in private clouds is one of the key considerations many businesses are facing today as they move to adopt or expand their adoption of cloud technology. The answer varies depending upon the organization, of course, but many businesses are opting to use both.

Indeed, 50 percent of enterprises will have hybrid clouds by 2017, according to the Global Hybrid Cloud Services Market 2016-2020 study by Technavio.

Costs, migration and monitoring in the past were much greater challenges for those businesses that considered and/or employed cloud services, but now hybrid cloud services enable small and medium enterprises to put most of their services on the cloud and still maintain some key legacy applications, the study notes.

“The hybrid cloud helps the companies as well as start-ups to use the best practices from traditional on-premise[s] IT infrastructure inclusive of governance, management, and standardization regardless of location,” according to the study. “It also provides an extended platform combining public and private clouds with dedicated servers to deliver seamless performance in a customized manner.” 

These are just some of the topics and companies I look forward to covering in Cloud Computing Magazine looking forward.

If you have any feedback on our coverage, any story ideas, and anything else you’d like to discuss, I look forward to your input. The best way to reach me is via email at [email protected].

Edited by Alicia Young
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