Enterprise cloud use reaches 'tipping point'

According to Verizon's State of the Enterprise Cloud report, enterprises are spending an average 45 percent more on cloud computing each month, and providers need to up their game to cater for businesses better.
Written by Charlie Osborne, Contributing Writer

Enterprises are using the cloud more readily for operations, sending more business-critical applications into the cloud and therefore requiring different security needs, according to a new report from Verizon.

The firms' 'State of the Enterprise Cloud Report' finds that enterprise use of cloud technology grew by 90 percent between January 2012 and June 2013. Verizon says that corporations have moved beyond testing and development, and are now more readily running external-facing and critical business applications in the cloud.

This is mainly due to production applications, which now accounts for 60 percent of cloud usage.

The increased used of cloud-based technology has been driven largely by the shift of business-critical applications to the cloud, according to Verizon. At the same time, businesses are investing in ways to increase cloud efficiency in order to improve memory and storage capacity in each deployed virtual machine used, and so VM deployment increased only 35 percent over the same time period.

On average, corporations are spending an average of 45 percent more per month on cloud services.

The report states that now so many business-critical applications are stored within the cloud, uptime and availability are essential services that providers have to refine and develop. Hybrid cloud services remain a popular option for companies, the report notes, as these setups give firms more control over their data and may be necessary for the successful integration and adoption of the cloud within established enterprise systems.

Security and compliance standards have driven hybrid cloud growth, however, the regulation of cloud computing in order to keep data secure can cause problems for providers. In Australia, cloud service providers Google, Telstra, and Microsoft have warned that a new mandatory Cloud Computing Consumer Protocol will leave consumers and businesses worse off, due to the prescriptive nature of the legislation. Therefore, the future of cloud computing may rely on a balance between cost effectiveness, control, and suitable compliancy standards that do not hamper businesses or providers.

"Enterprise cloud has reached a tipping point," the report says. "Organizations have seen the benefits cloud can provide -- both in efficiency and cost -- and are ready to move an increasing number of mission-critical applications to cloud-based infrastructure. However in order for this to happen, cloud service providers must deliver to enterprise-grade availability and security."

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