Enterprises ready for longer-term commitments with cloud providers
Cloud computing services has become a gigantic industry. And it's going to get even bigger, as more corporate IT functions and capabilities are delivered via various types of clouds -- both inside and outside.
That's one of the takeaways from a recent Microsoft Corp.-commissioned study of 1,734 companies, conducted by 451 Research, which finds that organizations now rely more on digital IT infrastructure than physical on-premises machines.
On average, 40 percent of 2016 IT budgets are going to on-premises infrastructure and staff, 33 percent to hosting providers, 14 percent to Software as a Service, and 12 percent to other off-premises services.
As organizations prepare for major business and technology changes, they will depend more on digital platforms to deliver products and services. The study finds 57 percent of organizational infrastructure will be digital, compared with physical, in two years, up from 51 percent today.The move to cloud is a big part of this.
Most organizations are using cloud on some level -- and they intend to pump up that usage even further. Six in ten say their heaviest investments will be in cloud-based software and applications over the next five years. These investments include cybersecurity (58 percent), cloud-based infrastructure (57 percent), mobile platforms and applications (55 percent), customer experience management systems (53 percent) and data mining and analytics (50 percent).
More than 80 percent of enterprises have an annual or longer-term contract with their primary cloud and hosting provider. Another 43 percent having a contract of two or more years. Almost all, 95 percent, intend to renew these contracts, and 38 percent even intend to increase spending with their primary provider upon renewal.
While the survey finds a high level of satisfaction with cloud providers, enterprises are maintaining relationships with multiple clouds, along with hybrid environments. A majority, 79 percent, work with more than one provider, with 29 percent reporting with work with four or more cloud or hosting vendors.
Backup and recovery, along with cloud migration services and premium support, are the managed services most in use. Managed services being purchased from cloud or hosting providers include the following:
- Backup and recovery (44%)
- Cloud migration services (24%)
- Premium 24 x 7 support services (24%)
- Cloud assessment, readiness and enablement services (22%)
- Disaster recovery/site recovery (21%)
- Cloud transformation services (16%)
- Archiving (15%)
- Application development tools and platforms (15%)
- Mobile services (15%)
- End-to-end app management, including monitoring and cloud brokering services (14%)
- Capacity planning tools (13%)
- Partner-enabled one-stop-shopping (12%)
- CDN/media streaming (10%)
Leading cloud-borne applications include email and collaboration, along with networking and security services. Applications being purchased from cloud or hosting providers include the following:
- Email, Unified Collaboration and Productivity Apps for Biz (31%)
- Networking (30%)
- Security (28%)
- Database and Data Warehousing (23%)
- Web (23%)
- Storage and Print (21%)
- Application Development (19%)
- Social Applications (17%)
- Data Analytics/Business Intelligence/Big Data (16%)
- Sys Mgt & Orchestration (Server/Storage/Private Cloud) (16%)
- Media Streaming and Digital Publishing (14%)
- Engineering/R&D/Technical Computing (12%)
- Line of Business (LOB) Applications (12%)
- Virtual Desktop Infrastructure (VDI) and Mobility Mgt (11%)
- Other Apps/Workloads, including industry-specific apps (3%)