Every technology approach goes through a series of phases, going from a combination of curiosity and nay-saying to over-the-top hype to just a daily part of business. Gartner has its own set of terms for this, going from the peak of inflated expectations to the trough of disillusionment, finally moving up the plateau of productivity. In its most recent incarnation of the hype cycle released in September, Gartner put cloud computing at the bottom of the trough of disillusionment, meaning that the glitz is off, and it’s time for the serious work.
So the time has finally arrived: cloud computing has become as commonplace in business as vacation-request forms. The fascination, debate, trepidation and business that has defined cloud in recent years is passing. It’s now computing. It’s now the let’s-roll-up-our-sleeves-and-make-this-stuff-work moment for cloud.
This is evident in the findings of the fifth annual cloud adoption survey from North Bridge, a venture capital firm, in partnership with research analyst firm Wikibon. The study’s authors call this the “new era of cloud practicality.” For starters, the survey of 952 executives suggests, cloud adoption is now reflected throughout entire business operations — significant processing, systems of engagement and systems of insight are moving to the cloud. Most departments are working with cloud — 81 percent of sales and marketing, 80 percent of business analytics, 79 percent of customer service and 74 percent of HR and payroll activities have transitioned to the cloud.
Software as a Service is the most prevalent form of cloud, seen at 77 percent of the organizations surveyed. More than two-thirds, 67%, also have adopted Infrastructure as a Service.
When it comes to acquiring cloud services, many are simply pulled from the internet, versus through traditional person-to-person sales channels. Seeking simple and clear relationships, more than 50 percent of executives opt for online purchasing or direct-to-provider purchasing of cloud services. This kind of online buying is expected in increase in the next two years up to 56 percent. With business users signing up for cloud services with little or no oversight, there’s a likelihood they are not negotiating for the best prices, are buying duplicate services, or are continuously subscribing to services that aren’t being used. As a result, more executives are worrying about the amount of money being spent. Accordingly, cost of cloud services is three times as likely to be a concern today versus five years ago.
Three quarters of company data in significant volumes now resides in private or public clouds. Company data in hybrid cloud systems is forecast to double over the next two years. Corporate cloud computing strategies are focusing on public (up 43 percent) and hybrid (up 19 percent) clouds. Private cloud, on the other hand, has taken a significant back seat (down 48 percent). The report’s authors do not offer insight as to why private cloud seems to have lost steam, but it appears there is growing comfort among enterprises with public cloud services. Security is still the top concern, but there’s also a recognition that it’s difficult for an enterprise’s own staff to keep up with endless security threats.
By Joe McKendrick