Here is little question that cloud has become one of the front burner issues for IT. According to Ovum's latest industry insights, almost half of respondents are reporting running at least some workloads in the cloud, For instance, for big data, 45% reported to be using the cloud. This week we received some additional proof points from Syncsort, which is releasing results of a cloud survey today.
In all, 70% of respondents reported that their organizations are using the cloud in some way or another. So what types of clouds are we talking about? About half the respondents used public and/or hosted private clouds, while just over a third are working with hybrid scenarios such as connecting on-premise data warehouses, transacitn databses, and Hadoop clusters to the cloud.
But here's the kicker. Less than 30% of respondents indicate their organization has a formal strategy for moving to the cloud or created teams, such as centers of excellence for promoting best practices. In other words, for most organizations, use of the cloud is still tactical. In fact, 42% of respondents reported that the choice to move to the cloud was typically conducted on an ad hoc basis, one use case or application at a time. What's surprising, given the piecemeal approach to cloud migrations, was that only a small minority (14% of respondents) are using more than one public cloud. When enterprises procure technologies or solutions in onesies or twosies, they invariably wind up with just about one of everything.
We've seen this movie before. New technology initiatives often sneak through the back door before the mother ship gets wind of it, and actually formulate coherent plans. That's been going on since the introduction of the PC, which was often procured through petty cash or purchase orders from line of business organizations seeking to bypass the red tape of IT, and we saw it once again when organizations began planning their web strategy, and it's not surprising that cloud adoption is following a similar trajectory. Eventually, enterprise IT moved in bridging bunches of silos that popped up while they were busy keeping the lights on.
For the cloud, it was initially development teams that wanted to rent some TestDev sandboxes rather than wait for procurement, or lines of business wishing to launch new mobile apps, or ephemeral apps. So it's not surprising when Amazon caught the rest of the world sleeping when it began renting out its cloud infrastructure back in 2006; after false starts with ASPs and dedicated hosting facilities, who could get excited about some e-commerce retailer offering up surplus compute cycles?
Of course we know where that story has gone, and why Amazon has replaced Microsoft, and before that IBM, as Oracle's mortal enemy. Oracle is staking its future on the premise that most of its customers will run their mission-critical workloads in the cloud by 2025. IBM is about to pay a third of its market cap for a provider that could give it a stake in managing the cloud world that materialized while it was fixated on cognitive computing.
But these are still early days with regard to critical mass enterprise adoption. Go to Amazon re:Invent, and you'll hear accounts of why Expedia and FINRA are investing their future in the Amazon cloud. But most enterprises haven't gotten that far. They haven't chosen any preferred provider strategies for cloud or formally designated multi-cloud sourcing.
The one thing they have planted their stake on is, with this sample, only 14% currently prefer cloud-native solutions. They pose double-edged swords in delivering on the scale and economics of the cloud, but like any proprietary platform, pose the risk of lock-in. Although at first glance, this might appear that enterprises have made their definitive decision, 61% of the group reported using SaaS solutions - the epitome of cloud-native. The paradox is yet another reflection that enterprises have not yet fully fleshed out their cloud strategies.
Another key indicator of lack of maturity is that respondents are still grappling with cloud costs as just over half indicated that the cloud has actually cost more than expected. It would be easy to blame consumption, as it's all too easy to fire up cloud instances and forget to shut them down. But purchasing to much capacity was cited by only 19% of respondents. By contrast, migration and management costs were identified by roughly 60% of the sample as the chief culprits.
There also remains the FUD factor over cloud security and privacy, and for good reason. There's a spate of new privacy laws, not to mention that headlines of data breaches are growing all too common. So it shouldn't be surprising that data and application security and privacy were deemed the top challenge. The irony there is that, given the rapidly morphing nature of cyber threats, the question is who is likely best prepared to play whack a mole: your IT department or a cloud company that does IT infrastructure for a living?
With all these teething issues, why are respondents going to the cloud? Surprisingly, the top reason was business continuity - although only 22% of respondents indicated that they would use the cloud for disaster recovery. The other benefits cited were IT efficiency followed by operational cost savings and elasticity. It's clear from the findings that most enterprises are still in a learning curve for achieving these benefits.