According to a Flexera/Rightscale survey on the evolution of the cloud, enterprises are embracing multi-cloud and expect 24% more investment in the public cloud in 2019. One of the priority issues is to better manage costs.
Flexera, a provider of IT asset cost management solutions, has released its annual “State of the CloudReport,” a survey of 786 IT professionals worldwide about cloud adoption in the enterprise. This study, formerly led by Rightscale, which was acquired in late 2018 by Flexera, comes amidst a dynamic market growth environment to say the least. In the third quarter of 2018 cloud infrastructure services revenue (including IaaS, PaaS and hosted private cloud) exceeded $17 billion.
21.5% growth for public cloud in 2018.
The public cloud market – which grew 21.5% in 2018 – remains dominated by AWS, whose leadership status is increasingly being challenged by Microsoft Azure. Google Cloud Platform, IBM Cloud, Oracle and Alibaba are also deploying significant resources to maintain good positions.
The first finding of the survey is that multi-cloud seems to have become the winning strategy for enterprises, with a particularly marked growth in the share of hybrid cloud and a priority given by IT decision-makers to the public cloud over the private cloud.
One third of companies of all sizes, and half of large companies with more than 1,000 employees, (i.e. nearly two thirds of the sample surveyed) spend more than one million euros per year on the public cloud… and they don’t intend to stop there! In 2019 companies expect a 24% increase in spending on the public cloud, compared to 8% for the private cloud.
Financial control of the cloud, a well understood imperative.
For the third consecutive year in the study, cloud optimization is also top of mind for IT decision-makers, regardless of their company size. The survey conducted by the American publisher specifies, for example, that 84% of IT managers in large companies place the cost management at the top of the list of topics to be addressed, almost on a par with cloud governance – namely the choice of control tools and thedevelopment of security procedures.
Cost control, the main challenge identified by IT managers.
Security is the third most important challenge, with 81% of IT managers considering it a priority.
Savings opportunities still available in the cloud.
Yet, despite the obvious interest of decision makers in controlling IT costs, the waste of cloud-related spending is still underestimated. IT managers estimate that 27% of spending in the cloud is unnecessary, while Flexera – which also provides cost control solutions – estimates that the average ratio is closer to 35% among its customers.
Similarly, despite a real awareness among IT managers, only a minority of them have chosen to implement cloud management tools, which allow them to scale instances according to actual usage. The study shows that cloud service customers are not fully exploiting the optimization options offered by providers either: one in two at AWS and less than one in four at Azure take advantage of the so-called “Reserved Instances” services.
A reorganization of priorities.
Another key point Flexera makes is that the growth of the market is having a significant impact on the hierarchy of roles for IT departments in charge of the cloud. At the top of the list, 68% of them believe that their mission is primarily to manage and optimize the costs of cloud services, while 62% believe that their priority is to decide and advise on applications and their hosting.
Cost management and optimization, two priorities for IT.
Finally, 59% believe that their primary role is to define cloud usage policies. The study also points out that, while IT departments are most often in charge of these governance and cost optimization issues, the budgets are most often in the hands of the business.
In terms of solutions and technologies, Azure seems – again according to the survey – to be gaining ground on AWS, which remains the leader, especially in the large enterprise segment where its adoption rate has risen from 56 to 60%, compared to 67% for AWS. Google keeps its 3rd position, with a rather stable growth, followed by VMWare Cloud, which went from 8 to 12% of aficionados. There has also been strong growth in Dockers containers – open source software that makes it easy to run applications in software containers – and Kubernetes, the open source container orchestration platform created by Google, which has made a particularly significant jump from 27% of adopters to 48%.[nz_highlight color=”rgb(42,49,122)”] A consideration of “cloud maturity.”
To better understand the challenges of the cloud, Flexera has applied a methodology that takes into account a “cloud maturity” model, segmented into 4 levels:
– Watchers: organizations that have a cloud strategy but have not yet developed applications in the cloud. They want to evaluate the options available in the cloud and identify relevant applications to implement for their business.
– Beginners: newcomers to the cloud, they work on proof of concepts or small cloud projects. They want to gain maturity with the cloud in order to decide what future projects to push.
– Intermediate: these companies already have several projects or applications deployed in the cloud. They are focused on improving their use of the cloud and expanding it.
– Advanced: these companies use cloud infrastructures massively and are looking to optimize cloud operations and related costs.
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The nature of the challenges related to the cloud varies according to the level of maturity.
Find the complete Flexera study here.