Is All-Cloud Computing Inevitable? Analysts Suggest It Is


Joe McKendrick

July 7, 2016

In various surveys I have seen and worked on in recent years, approximately one in four companies have reported they are adopting public cloud services for enterprise applications, while about half said they were building internal clouds to manage key enterprise areas. Some continue to avoid the cloud altogether, but this number is melting away.

While it’s going to take time for embedded, on-premises corporate applications to shift to cloud, many industry observers feel it’s going to happen sooner than later. Gartner, for one, predicts that by 2020, “a corporate ‘no-cloud’ policy will be as rare as a ‘no-internet’ policy is today. This isn’t just going to be the case for packaged application from vendors — who are now pushing cloud-first or even cloud-only offerings — but for home-grown solutions as well.  Gartner suggests  that even the most adamant no-cloud organizations will throw in the towel and admit it’s a force they can’t control. ”Cloud will increasingly be the default option for software deployment. The same is true for custom software, which increasingly is designed for some variation of public or private cloud,” according to Gartner analyst Jeffrey Mann.

Is this the impending reality, or analysts pontificating on the next big thing? Look at what some major corporations are doing, and the prediction appears to have legs. For example, Johnson & Johnson, a pharmaceutical and medical devices manufacturer, recently said it intends to have 85% of its applications and systems in the public cloud within two years’ time. As reported in The Wall Street Journal, the company intends to downsize at least 40% of its existing on-premises assets, and move eberything to Amazon Web Servces, Microsoft. and NTT Communications by 2018. Other major corporations, including Coca-Cola and GE, are also most of what they have in the cloud. 

A separate survey of 1,800 IT executives confirms as much. The study, by  Veritas Technologies, indicates that nearly three-quarters of enterprises continue to adopt multiple private and public cloud strategies. Overall, the research revealed that business-critical workloads in the public cloud are set to double in the next 24 months – roughly the same rate as non-critical workloads – putting pressure on IT departments to ensure their entire business services, not just their infrastructure, are highly available and secure.

This migration won’t just involve shadow IT, or edge-of-enterprise apps, the Veritas study’s authors state. For example, one traditional view is that less-important workloads will migrate to the public cloud first and at a faster rate. While this may have been the case early on, the study found that this is shifting: business-critical workloads including CRM and ERP are moving to the cloud at the same rates statistically – from 25-30% — as other, less critical workloads. While these findings indicate an increased trust in moving data of all types to the cloud, it also translates to added pressure for service providers to ensure high availability and avoid downtime, as well as challenges IT departments to have the right data protection strategies in place that can span heterogeneous infrastructure – on and off premise.

Of course, there amount of well-functioning, on-premises systems in the world is huge. The Gartner analysis admits this, noting that “not everything will be cloud-based, and concern will remain valid in some cases. However, the extreme of having nothing cloud-based will largely disappear.” Hybrid will be the most common usage of the cloud, Gartner states.

Again, the vendors — who see the handwriting on the wall — are pushing a lot of this. They are all becoming cloud vendors. Gartner predicts that within the next three years, more than 30 percent of the 100 largest vendors’ new software investments will have shifted from cloud-first to cloud-only — thereby pushing any enterprise fence-sitters in the direction of cloud. ”More leading-edge IT capabilities will be available only in the cloud, forcing reluctant organizations closer to cloud adoption,” said Gartner’s Yefim V. Natis, adding that this will be a good thing. “Rigid organizations cannot produce agile IT solutions. As delivery shifts more to the cloud, most IT organizations will have to reorganize to reflect the business realities of cloud computing: continuous innovation and change, pervasive integration, competing with cloud providers for some initiatives, and crucial prevalence of influence over control in IT’s relationship with lines of business.”

By 2020, more compute power will have been sold by IaaS and PaaS cloud providers than sold and deployed into enterprise data centers, Gartner adds. The revenue for Infrastructire as a Service (IaaS, or processing and storage) and Platform as a Service (PaaS, or middleware, databases and development tools) will exceed $55 billion — and likely pass the revenue for servers.

This article was written by Joe McKendrick from Forbes and was legally licensed through the NewsCred publisher network.

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