Flexibility, not cost savings, drives cloud adoption - 4/11/2011. Monday 11 April 2011 16:06 Despite the cash-strapped business environment, flexibility rather than cost savings is the main reason for organisations adopting the cloud, according to research. Only 16% of organisations cited cost savings as the primary driver for cloud adoption, compared with 53% who outlined agility as the most important factor, according to a study by the Cloud Industry Forum. In both public and private sector organisations, flexibility was given as the main reason for the adoption of cloud, by 55% and 52% of organisations respectively - three times the number that cited cost savings as the main driver.
Of 450 senior IT and business decision-makers, SMEs and public sector organisations polled, 48% said they are using some form of cloud service, with larger companies more likely to use them. Organisations that employ more than 20 people are at the forefront of the cloud revolution, as opposed to the small companies (defined as 20 employees or less) or public organisations. Cloud turning outsourcing 'upside down' - Business - News - ZDNet Asia. Cloud computing is set for a bright future and will turn traditional outsourcing "upside down", but the latter is not likely to disappear for "many years yet", according to an industry analyst.
Rolf Jester, Gartner's Distinguished Analyst and Asia-Pacific vice president for IT services, pointed out that cloud is not yet a major threat to outsourcing because deals that have been struck or are being negotiated, will remain valid for five to 10 years and are delivering value to businesses. "People aren't going to change just because something new comes along," Jester said in a phone interview with ZDNet Asia, noting that from a buyer's point of view, there are still concerns over security and privacy of data in cloud computing.
In a traditional outsourcing contract, a company typically signs a multiyear mega deal with an IT services vendor which will manage specific functions for the company. Such large contracts, however, are dwindling, according to a previous Gartner report. The End of Outsourcing (As We Know It) In the next five years outsourcing as we know it will disappear. The legion of Indian service providers will be sidelined or absorbed. U.S. and European companies that pioneered this corner of the high tech industry will suffer similar fates if they don't wake up. Who will emerge as the new leaders? Google (GOOG) and Amazon.com (AMZN), brands that we associate with search and retail, will become better known for outsourcing. Ludicrous? Traditionally, outsourcing companies sell customers deals that can span a decade and easily run to tens of millions of dollars. Ruthlessly seeking economies of scale In the new model, outsourcers provide standard, off-the-shelf software on a "pay-per-drink" basis.
Why is this happening now? That's where the cloud comes in. These factors will set off a wave of global consolidation in tech services. It's not merely Indian companies wrestling with these changes. The Losers: Mid-tier Indian outsourcers will be acquired by larger, more aggressive companies. The numbers don't lie -- cloud computing boosts server sales | Cloud Computing. We've been reporting on server growth around cloud computing for a while.
And now, according to IDC, worldwide server market revenues increased 11 percent in the second quarter. Clearly, this is not an aberration, but a counterintuitive trend. These figures are driven partially by the worldwide economic recovery, but also by corporate interest in cloud computing, especially private clouds. It appears that cloud computing's initial promise of fewer data centers and servers is having the opposite effect on hardware purchases. [ Get the no-nonsense explanations and advice you need to take real advantage of cloud computing in the InfoWorld editors' 21-page Cloud Computing Deep Dive PDF special report. | Stay up on the cloud with InfoWorld's Cloud Computing Report newsletter. ] The reasons behind this are obvious. Cloud computing providers are also driving hardware growth. As a consequence, we're seeing decreased ROI from cloud computing. Cloud computing: Cloud facts and figures - cloud computing. Gartner.
Although it’s still early days for cloud computing, a raft of global analyst firms have been surveying IT decision makers to gauge what their intentions are around cloud adoption, as well as how much the market will be worth over the next five years. A collection of their findings is listed below. IDC’s global cloud computing studies show massive growth over the next few years. According to its findings, three of the top five benefits for cloud adoption in 2009 were linked to cost advantages, such as paying for what you use, streamlining payments with services, and shifting IT headcount costs to the services provider. The analyst firm attributed a significant proportion of this focus to the economic downturn experienced in 2009.
Outside cost benefits, the importance of standardising systems increased between 2008 and 2009, rising from the sixth highest priority to fourth. But there are still significant challenges to overcome. Top five advantages of cloud computing: Cloud computing by the numbers: What do all the statistics mean? I came back from my summer break to an avalanche of cloud computing facts and figures in my inbox -- most recently CRN predicting that SMB spending on cloud computing would reach $100B by 2014.
There are dozens of cloud computing forecasts and predictions out there (Reuven Cohen of Enomaly does a fantastic roundup on his blog), but its sometimes a challenge to figure out what they all actually mean. Here are three things I think we can all agree on, and two real head-scratchers: 1) The market for public cloud computing services is large and growing, even if the exact numbers vary widely IDC estimates the market for public cloud products and services at $16B in 2010, growing to $56B by 2014.
Gartner more optimistically estimates the cloud market at $150B by 2013 while Merrill Lynch estimates the market at $160B by 2011. And of course, the article that spurred this post quoted AMI research's estimate that SMB cloud spending alone will reach $100B by 2014. Let's ask the cloud leaders.