Despite the economic and social trauma of the past two years it appears that one area that has thrived as a result of the pandemic is cloud computing.
Recent financial results from Industry behemoths Google, AWS and Microsoft all show, that despite downturns in some area of their businesses, cloud computing has performed strongly.
First quarter year over year results, saw Google’s cloud platform up 44% first quarter, Microsoft’s Intelligent Cloud segment 26% and AWS’ 36.5%.
And there doesn’t appear to be any signs of this trend stalling soon.
According to Gartner’s latest forecasts, the amount spent on public cloud is expected to continue to soar on a year-by-year basis. Current growth estimates suggest spending on public cloud services will hit $494.7bn in 2022, representing a 20.4% year-on-year increase, up from 2021’s $410.9bn, and $600bn in 2023.
What is fuelling this growth?
According to Gartner one of the main drivers is the enterprise looking to embrace hybrid working models. Infrastructure as a service (IaaS) will experience the highest growth in end-user spending this year at 30.6%, with spending expected to hit $119bn.
Sid Nag, research vice-president at Gartner, in a briefing note stated that: “The new reality of hybrid work is prompting organisations to move away from powering their workforce with traditional climate computing solutions, such as desktop and other physical in-office tools and towards Desktop as a Service (DaaS), which is driving spending to reach $2.6bn in 2022.”
Sid also noted that tech procurers are also becoming more informed about the choices available for delivering their services: “Cloud is the powerhouse that drives today’s digital organisations,” said Nag. “CIOs are beyond the era of irrational exuberance of procuring cloud services and are being thoughtful in their choice of public cloud providers to drive specific, desired business and technology outcomes in their digital transformation journey.”
“IT leaders who view the cloud as an enabler rather than an end state will be most successful in their digital transformational journeys. The organisations combining cloud with other adjacent, emerging technologies will fare even better.”
The growth in Infrastructure as a service was also highlighted by Alphabet’s CFO (Chief Financial Officer) Ruth Porat during an analyst call stated that the biggest increases in headcount during the quarter across product areas was again in Google Cloud where revenue growth reflected significant growth in infrastructure and platform services.
A theme reinforced by CEO Satya Nadella during an earnings call, when he discussed how Microsoft was benefiting from customers migrating client server applications to the Azure platform. “There is a migration of a bunch of workloads that we may have won in the client server space that are migrating, but the most exciting thing is the type of Tier 1 workloads that we have never seen run on any Microsoft infrastructure.” stated Nadella.
As businesses continue to move their infrastructure using SaaS, PaaS and IaaS, one continued trend is the need for trusted partners such as vXtream who specialise in supporting their clients with infrastructure, security, compliance, support and problem-solving. Deriving the full benefits that cloud computing offers is complex and can be a costly exercise – if poorly adopted (it is suggested that organizations overspend for cloud by an average of 13 percent vs budget).
As Gartner’s Sid Nag stated: “IT leaders who view the cloud as an enabler rather than an end state will be most successful in their digital transformational journeys. The organizations combining cloud with other adjacent, emerging technologies will fare even better.”
If you have a cloud project or are considering further extending your IT into the cloud, contact us today to discuss how we can help.
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