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Cloud computing has all the momentum, but we still live in an on-premises world for now

Only a handful or enterprises can be considered 'all-cloud,' while one-third are 'mostly cloud' at this point. Most IT executives still see cloud as an IT optimization play,
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Written by Joe McKendrick, Contributor on

With all the analyst, press and conference talk about the ascendency of cloud, one can be forgiven for assuming that the entire world is now running on AWS, Azure or Google Cloud and other providers. However, at this stage, only seven percent of enterprises are truly all-cloud. This number is likely to more than double over the next two years, but still represents the minority of enterprises. 

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Photo: Joe McKendrick

That's one of the takeaways of a recent survey of 850 IT executives released by Foundry (formerly IDG Communications), which finds clear momentum for cloud computing going into the near future, but a lot of work until on-premises systems are replaced, dislodged, or shifted into the background. 

Half of the executives surveyed said their organization's total IT environment is "some on cloud but mostly on-premises," while over a third (34%) is "mostly cloud but some on-premises," and only seven percent is "all cloud." The all-cloud number is expected to increase by some 250% over the next 18 months, to 17% who plan to shift everything they have to the cloud.

There has also been impetus to expand organizations' skill repertoire for cloud in an effort to close the skills gap. One-third report a lack of cloud management skills/expertise. and 30% report difficulty finding staff with cloud development skills/expertise. At the same time, roughly 8 in 10 have added an average of 3.3 new roles and functions as a result of their cloud investment. The top roles added include the following:

  • Systems administrator (33%)
  • Cloud architect (30%)
  • Security architect (23%)
  • Cloud systems engineer (22%)
  • Cloud software engineer (22%) 

There's no question, of course, that cloud has become the default strategy for most. Seventy-two percent of IT leaders say that their organization is defaulting to cloud-based services when upgrading or purchasing new technical capabilities. About half, 46% of respondents, predict their organization's total IT environment will be "mostly cloud but some on-premises" by then -- up from 34% at present.

Much of IT infrastructure itself leverages cloud-based services. The percentage of companies with most or all IT infrastructure in the cloud is expected to increase from 41% today to 63% in the next 18 months. Overall, the top growth areas cited are Software-as-a-Service (with 52% seeing growth over the past year), followed by Platform-as-a-Service (38%), Security-as-a-Service (37%), Infrastructure-as-a-Service (36%) and cloud-based analytics (33%). 

The survey also shows that on average, organizations will allocate almost one-third (32%) of their total IT budget to cloud computing over he coming 18 months.  

Interestingly, while cloud is seen as an enabler of greater business flexibility, facilitating lower-cost innovation and growth to match business expansion, IT leaders still primarily see it in light of its IT utility -- helping data centers run leaner and cheaper, with greater resiliency. The top business objectives driving cloud investments include the following: 

  • Enabling disaster recovery and business continuity (40%)
  • Replacing on-premise legacy technology (39%)
  • Lowering total cost of ownership (34%)
  • Improving employee productivity (33%)
  • Greater flexibility to react to changing market conditions (32%)

Top challenges are controlling cloud costs (36%), data privacy and security challenges (35%) and lack of cloud security skills/expertise (34%). When asked what IT executives expect from future or current cloud providers, leading the list is security expertise (41%), followed by better cloud management capabilities (40%) and cost management capabilities (38%).

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