The cloud is ubiquitous: according to Gartner, spending on public cloud services is forecast to reach $ 396 billion in 2021 and grow 21.7% to $ 482 billion in 2022. And by 2026, Gartner predicts that spending on public cloud will exceed 45% of all business IT spending, down from less than 17% in 2021.
But how well do companies understand the potential benefits of the cloud, and the potential limitations, as they rush to migrate? In a complex and evolving landscape, current offerings from major cloud players may not allow for the important combination of flexibility and control that today’s organizations expect. At the same time, as companies move down the path to digital transformation, the number of business applications they use is increasing across all departments.
That means companies may need to rethink and reevaluate the assumptions of the common cloud strategy, as well as rethink some of their investment decisions. For example, more and more companies may not want to be forced to use a company’s software, and they are more and more likely to use open source software. A growing number of cloud software services with open source expertise offer competitive alternatives to the proprietary portfolios of public cloud infrastructure companies.
As a result, the shape of cloud services, and the issues that organizations need to consider, is changing. Here, we address common assumptions around cloud strategy and what organizations need to consider to fully reap the benefits of the cloud.
Assumption: migrating to the cloud will reduce costs and increase security
Two of the most important arguments for moving to the cloud are the opportunity to reduce total IT spending and take advantage of better security controls. However, while the potential for cost savings exists, in many cases organizations are paying more for convenience and the costs can add up. For example, out-of-the-box cloud services are typically more expensive than self-hosted on-premises infrastructure if managed as a legacy IT infrastructure. In the cloud, companies pay for the flexibility to rapidly provision, de-provision and scale, and have the opportunity to use that flexibility to reduce costs.
That has led to cloud repatriation: In 2019, IDC predicted that up to 50% of public cloud workloads it would be repatriated to local infrastructure or private cloud to take advantage of the best option for specific workloads.
In terms of security, the cloud can have more sophisticated controls that are easier to implement than on-premises infrastructure. However, the decentralized nature of the public cloud can open up a more complex security posture, one over which the organization may not have enough control. TO recent IDC survey found that almost every business has experienced some type of data breach in the cloud. That means companies must consider and evaluate the objectives of their IT security environment in each area of the cloud.
Assumption: sticking to a cloud provider is best for businesses
While it may be convenient, many enterprise-grade organizations find that the standard cash model from one of the major cloud providers does not meet their needs for flexibility. Sophisticated IT organizations can find opportunities to optimize both cost and time to market by flexibly moving workloads between cloud providers and between cloud and on-premises.
It is also important to understand that the “cloud provider” is not limited to the big three cloud infrastructure providers; Over time, more and more ISVs are becoming cloud providers in their own right. For example, an advanced database user may depend on high performance, sophisticated behavior, and advanced settings that are not available in the cloud provider’s managed offerings. Also, if that advanced database user uses an open source database like PostgreSQL, they will probably want that area of their stack to be served by a provider that is a core database company, not a core company. infrastructure that handles hundreds of other applications and services. Today, thanks to a trend toward separation of cloud services, organizations can regain more control over their cloud database deployment.
Lastly, while hybrid architectures can mitigate costs and increase flexibility, the data-centric nature of today’s enterprises presents additional challenges. It is difficult and time-consuming to move data and databases, and it can be particularly challenging to disconnect and withdraw from proprietary cloud data services. Independent cloud providers can facilitate cost savings by separating services from cloud providers, providing the freedom and flexibility that a cloud-independent approach offers.
Assumption: the cloud is a mature landscape that will not change
Cloud is one of the fastest growing IT spending areas in all industries. But while studies show that 92% of IT environments are already, at least in part, in the cloud., enterprise cloud adoption remains in the early stages of what will be a profound transformation for all businesses. Far from being a static and mature landscape, cloud technology is constantly evolving.
A significant technological change in the cloud over the past decade has been the continuous and dramatic reduction in the cost of computing and infrastructure. The creation of development tools and the use of programming languages has also become easier, which has allowed development tools to leave the exclusive purview of IT specialists and spread to the rest of the organization.
Finally, as organizations prioritize regaining control over the convenience of a single public cloud, technical expertise in the cloud in different areas has spread across different service providers. These providers are getting more creative about how to build a cloud service offering, such as a database as a service, that is separated from the public cloud infrastructure and changes the definition of a managed service.
The evolution of the cloud: a balancing act
While there is incredible growth and a tremendous amount of energy and discussion about the cloud, it is still relatively early in the evolution of the cloud. What is changing as organizations emerge from the early stages of cloud adoption is that companies want to claim higher control orders, rather than remain in debt to a single cloud provider. That’s leading to a multi-cloud approach that includes a more dynamic deployment between the traditional on-premises and public cloud – based on Gartner’s 2020 Cloud End-User Buying Behavior Study, 76% of respondents reported using more than one cloud provider.
New independent software vendors are entering this emerging and evolving landscape, changing the shape of managed services to reflect customer needs and to offer more expertise in specific areas of the cloud and open source platforms. Ultimately, as cloud services go through this separation process and move away from monolithic architecture, cloud strategy efforts will become a balancing act between control and convenience. Businesses need to think strategically about what services to use from major cloud providers and what services can be offered by independent cloud providers with the necessary expertise.
This article was produced by Insights, the custom content arm of MIT Technology Review. It was not written by the editorial staff of MIT Technology Review.