Cloud Trends Facing a Market in Transition

Cloud Trends

Cloud Trends Facing a Market in Transition

By Special Guest
Peter Merkulov, VP of product strategy and technology alliances at Globalscape
  |  December 07, 2016

There’s a seeming contradiction in cloud trends. According to a recent report in The Wall Street Journal, research firm IDC (News - Alert) says that spending on cloud infrastructure is trending up and, in fact, is outpacing spending rates on traditional IT. Another report in the journal, however, cites a survey from tech industry consortium CompTIA that says enterprise cloud application adoption rates are trending down. How can that be?

The different trends aren’t actually all that surprising. Nor are they contradictory. In fact, they are indicative of the way markets mature. There are clear advantages for organizations that wish to move workloads to cloud infrastructure, especially from a dollars and cents perspective. The verdict is in, and so reports from IDC and other technology analyst firms that show spending on the rise make perfect sense. But as more money is spent on cloud infrastructure, shouldn’t adoption of cloud applications also be on the rise?

Just as they are comfortable with moving workloads to the cloud, organizations are also clearly at peace with data to enterprise applications in the cloud. Questions related to security have largely been answered, and ease of access in a highly mobile world is a clear advantage. What seems to be happening is that the organizations are evaluating applications with more care and consideration.

Consensus is that the operational realities of cloud computing are settling in. At its recent height, the inclination on cloud applications was to adopt and adapt; but for many organizations, it has become clear that, while the cloud is great for a lot of things, there are still many tasks that are not yet cloud-ready.

Companies have encountered challenges related to back-office interoperability and performance in certain contexts. They are wrestling with the gap between hype and reality and, as a result, are looking back at their experiences and the hard lessons learned during the cloud’s early days. They are taking stock of what they now know of the current wave of IT transformation to inform the next wave. CIOs enlightened by that history can avoid a repeat of their peers’ errors – and their own.

What we’ve found working with clients who want to begin taking advantage of the cloud’s cost and accessibility advantages is that they will start new projects in the cloud, but will leave their legacy systems intact. This is consistent with the trends identified by IDC and CompTIA (News - Alert). That’s good news for companies offering services that span the cloud and legacy worlds because it means there’s an opportunity to capture new use cases by growing a cloud or hybrid footprint within their existing customer base, while continuing to service on-premises installations where mission-critical applications are already integrated with back-office systems.

Another confirming trend we’ve seen is the migration of traditional applications onto the leading IaaS platforms like Amazon Web Services (News - Alert), Microsoft Azure, or Google Cloud Platform. This is where the cloud’s ROI absolutely shines for organizations that want to leverage cloud’s cost advantages while maintaining management control over mission-critical parts of the infrastructure. This approach lets companies focus on managing the applications and IT workloads that are key to their business, while shifting the responsibility (and cost) of managing the equipment and standing up servers from their own staff and onto a third party.

In today’s global markets, taking advantage of the cloud also lends itself to operating with high availability and access across different geographies. With the right cloud strategy, the focus can be on maintaining compliance both at home and abroad in an increasingly regulated business environment. This is especially important for responding to significant changes and uncertainties with data security and privacy regulations. In Europe, that may mean keeping data local in compliance with EU-US Privacy Shield or, in the Pacific markets, responding to changes to the APEC Cross Border Privacy Rules.

Just as organizations that are cloud consumers are using this moment in the development of the market to take stock of their experience to set sensible strategies for the future of their IT and business models, organizations that develop and sell cloud-based services must do the same to anticipate and meet the evolving needs of the market.

This means focusing on features that meet customer requirements not only in terms of the applications themselves, but also in areas like security and management capabilities as well as configuration, whether purely cloud-based, hybrid, or even supporting on-premises needs for companies at various stages of transition.

Peter Merkulov is vice president of product strategy and technology alliances at Globalscape.

Edited by Alicia Young
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