Enterprise adoption of cloud computing has been a game-changer for those that know how to take advantage of hosting data in the cloud. Now companies are moving beyond cloud experimentation to broader-based implementations. In addition, the cloud computing market has been impacted by vendor alliances, such as AT&T/IBM and Sprint/CSC. According to the research firm Current Analysis, these alliances are key.
“Partnerships do more than fill in gaps, they can elevate the level of innovation to create a service that is significantly more compelling than what one vendor might do on their own. In the case of the IBM/AT&T relationship, the two companies have created a cloud option that is really a viable alternative to much more complex outsourcing engagements,” said Amy Larsen DeCarlo, principal analyst for security and data center services at Current Analysis.
In addition to connections, for carriers, jumping into cloud computing offerings can be a way to make additional revenue with services. “Many have stepped up to provide end-to-end cloud solutions,” DeCarlo pointed out. “Telecom companies have more than just the network; most also have significant data center infrastructures and deep expertise in virtualization. They can leverage this to create complete end-to-end cloud solutions, particularly in areas like IaaS.”
Indeed, there are opportunities available for carriers that decide to include cloud in their portfolio. DeCarlo highlighted that cloud services could give carriers more than just a source of replacement revenue for services whose margins are declining rapidly. “On-demand service can introduce a whole new set of prospects to the carrier’s services and open up new market growth sectors to the provider,” she said.
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DeCarlo said that in the last five years the changes in enterprise cloud adoption have been profound. “Five years ago, there were far fewer options for enterprises. Most large businesses had, at best, only a passing familiarity with the cloud concept. Providers were still struggling with how to define and message the solutions they had, and develop services for the future. Typically, the few that were using cloud services five years ago were relying on the services to support very tactical applications (supplemental storage, test and development),” DeCarlo said.
Indeed a lot has changed in recent years: the number of cloud providers has increased, and some of CIOs’ security concerns have been clarified. Enterprises are more likely to rely on cloud services now than before, and they have realized that by trusting in cloud computing, they can take advantage of its benefits, such as flexibility, time-to-market and scalability, among others.
In an enterprise cloud adoption study, Current Analysis found that 64% of the surveyed enterprises said they use cloud computing now; the remainder said they will deploy workloads into the cloud and/or consume apps via the cloud within the next 24 months. The primary research included 550 companies in the U.S. and Europe.
The survey also found that although software-as-as-service (SaaS) leads enterprise deployments, the number of respondents using infrastructure-as-a-service (IaaS) solutions doubled during 2011.
“SaaS is the most popular today, but more enterprises are gravitating toward IaaS. SaaS is easy to adapt—rather than upgrading a software, an organization can choose to consume a comparable application through the cloud. It also may have the most immediate cost savings, and there are many options,” DeCarlo pointed out.
According to the DeCarlo, IaaS becomes more popular as organizations find good use cases for a range of applications, especially use cases where capacity needs fluctuate on a seasonal/cyclical basis.
The survey also found that security concerns remain the biggest obstacles to cloud deployment, as well as the biggest criteria for choosing a provider, followed closely by reliability, which tops the list of post-deployment challenges as well.