Cloud computing comes of age as the foundation for enterprise digital transformation

Cloud computing will firmly establish itself as the foundation of tomorrow's enterprise application platforms in 2019.

Last year Forrester predicted that cloud computing would radically accelerate enterprise transformation everywhere. After a decade of powering small and medium business success -- and giving disruptive companies the tools and technologies they needed to compete head on with the world's largest firms -- cloud was poised to drive significant enterprise change in the very firms being disrupted by innovative startups.

Also: Cloud computing sticker shock is now a monthly occurrence

In 2018, cloud computing has indeed become a must-have technology for every enterprise. Cloud is no longer a place to get some cheap servers or storage. It's not even a single place. Cloud computing is now shorthand for how companies turn amazing ideas into winning software -- faster. Nearly 60 percent of North American enterprises now rely on public cloud platforms, five times the percentage that did just five years ago. Private clouds are growing fast, too, as companies not only move workloads to the top hyperscale public clouds but create powerful on-premises cloud platforms in their own data centers, using much of the same open source software they can find in the public clouds.

Also: Best cloud services for small businesses CNET

As firms prepare for 2019, we predict that the biggest cloud providers will get bigger, containers will reshape every cloud platform, and the combination of low-cost infrastructure plus high-value development services will firmly establish cloud as the new enterprise digital application platform -- and will drive up spending on cloud even faster than we predicted only a few years ago.

Here are three key takeaways from our 2019 cloud computing predictions:

  • Enterprise cloud spending will soar as core business app modernization takes off. In 2019, no large enterprise will be able to put off modernizing its core business applications -- those transaction systems, key databases, inventory, eCommerce, and operations apps. How will they do it? Some will be replaced with new cloud SaaS apps, and others will be refactored using new cloud-native tech like containers, Kubernetes, and functions. But most will be enhanced using the incredible range of emerging technologies being pioneered in the cloud, from new databases to edge computing devices, internet of things, machine learning, and artificial intelligence. Spending will surge as companies race to modernize existing apps and processes and derive new insights from the mountains of data they already collect.
  • Private cloud adoption and spending will grow faster, along three distinct paths. After many years of stagnant private cloud strategies (too much time was spent trying to compete with the public clouds), we expect enterprises to rethink and accelerate how they transform their own data centers into cloud powerhouses. Private cloud is no longer about quick provisioning of servers -- private cloud in 2019 is about creating a flexible, Agile, automated, and software-defined software development platform. Success will be measured by developer satisfaction and time-to-market for new products and services, and not by taking out cost. Firms will build private clouds on top of what they have, build them on top of cheaper open source platforms, or have private clouds built and run for them. Whichever they choose, enterprises will get real about on-premises and hybrid clouds.
  • True SaaS-based connected cloud ecosystems will emerge to turbocharge innovation. In 2019, we'll see a resurgence of what we used to call "industry clouds," with extensible SaaS applications at their core. From healthcare-focused clouds to financial services and insurance clouds, enterprises will seek platforms run by companies that understand their business and their industry. We are already seeing SaaS vendors doubling down on integration and extending their platform beyond the first set of features that established them in their markets. Salesforce, Workday, SAP, Oracle, and other app leaders are opening up their platforms and adding new development tooling, integrations, and deployment options, with an eye to which specific industries they can target to accelerate adoption. SaaS apps are becoming development platforms, and that shift will start to bear fruit in 2019.

Also: Here's why the public cloud is growing rapidly TechRepublic

In 2019, cloud computing will firmly establish itself as the foundation of tomorrow's enterprise application platforms. It's the best way to create the compelling software experiences that your customers demand and your competitors fear. Cloud spending will spike as enterprises eagerly adopt cloud tools and services wherever and however they can. Buckle up: The cloud ride is accelerating.


-- By Dave Bartoletti, vice president, principal analyst

To understand the seismic shifts that firms will face in 2019, download Forrester's predictions 2019 guide.

This post originally appeared here.

Previous and related coverage:

What a hybrid cloud is in the 'multi-cloud era,' and why you may already have one

Now that the services used by an enterprise and provided to its customers may be hosted on servers in the public cloud or on-premises, maybe "hybrid cloud" isn't an architecture any more. While that may the case, that's not stopping some in the digital transformation business from proclaiming it a way of work unto itself.

Cloud computing: Here comes a major tipping point

Application spending has moved to the cloud fastest, but other areas of IT spending are catching up.

Salesforce's master plan through fiscal 2022 by the numbers

Salesforce's growth for the years ahead are pegged to multi-cloud customers as well as add ons to core services. Here's a look at the core figures.

When supercomputing and AI meets the cloud

Ireland is getting a new supercomputer; Penguin Computing CEO Tom Coull on how supercomputing is taking on some big computing challenges.

Related stories: