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IDC Survey: What IT Is Likely to Move to the Cloud?

Posted by Frank Gens on January 5th, 2010

cloud_surveyIn a recent post, I shared users’ perceptions of cloud benefits and challenges from our most recent IDC IT Cloud Services Survey.  In this post, I’ll show what these same IT and line-of-business executives say about their likeliness to adopt the cloud services model for different IT applications, workloads and services.

Once again, the survey was fielded,  from the IDC Enterprise Panel of IT executives and their line-of-business (LOB) colleagues.

Organizations Are Likely to Consider Cloud Delivery for Many IT Offerings

We asked the panel to rate their organizations’ likelihood – on a 1 (very unlikely) to 5 (very likely) scale – to pursue the cloud model for a variety of IT applications, workloads and services.  The chart below shows the percentage of panelists responding 3, 4 or 5 – that is, neutral to very likely.

Likely_Cloud_Adoption-thumb

CLICK IMAGE to ENLARGE

The most obvious message in the data – with almost 50% or more  respondents in the 3-5 range for all categories – is that there is a general willingness to consider the cloud model for all of these areas.  Of course, there’s a big difference between users answering a survey question and actually making the move to the cloud.  But these responses certainly suggest the door is open for cloud services providers to make the case for cloud versions of all of these IT offerings.

What’s Most Likely to Move to the Cloud?

Diving into the detail, there are six clear takeaways from the survey responses:

  • Web Apps/Sites and Collaboration are already there.  It’s no surprise that the most likely areas for cloud model adoption are where it’s already commonplace!
  • Data/Content is the next big adoption driver. Three of the next five top cloud adoption areas have to do with data/content – its back-up (#3), distribution (#6) and storage (#7).  The cloud model offers distinct advantages for these IT needs, being: off-site, distributed (close to users), able to scale as content volumes continue to explode, and scalable at affordable costs.
  • Business Applications are expanding to the cloud… The fact that Business Applications is #4 isn’t a big surprise – CRM in the cloud has been a viable option for many organizations for several years.  But this strong showing suggests that, in the next several years, we’ll see a steady expansion of business application categories in the cloud, and adoption by wider variety of organization profiles.
  • …and so are Personal/Desktop Applications. More of an eyebrow-raiser is the strong showing for Personal Productivity Apps (#5) – this suggests that the low costs and simplicity/speed of deployment of the cloud model will continue to increase traction for cloud-based productivity apps/suites.  The growing use of mobile devices – which typically use lightweight front-end apps that depend on cloud-based apps and services – will certainly drive more personal apps to the cloud.  The leaders in PC-based productivity apps, Microsoft and IBM, have clearly noticed: in 2009, both stepped up their development of competitive cloud offerings in this space, and are already marketing these offerings aggressively, attempting to keep cloud-centric players like Google and Zoho out of key accounts.
  • IT Infrastructure offering results reflect earlier stage of maturity. Aside from the data-oriented cloud offerings, infrastructure-related cloud offerings – IT Management (#8) and Server capacity (#9) – ranked low.  In our view, this is not because users consider the cloud model inappropriate for these offerings.  Rather, the responses reflect that these cloud offerings are generally less mature – and less well-understood by users – than, say, Collaboration, Web Hosting and Business Apps (e.g., CRM) in the cloud.  We expect to see these offerings move up the “adoption likelihood” ranks as more cloud infrastructure offerings come to market, especially from long-established enterprise IT suppliers, like HP, IBM, EMC, Cisco, Dell, CSC, Accenture, AT&T and Verizon.
  • Business Analytics, App Dev/Test and IT/Information Security – look for these to come up fast in 2010. Right at the bottom of the list are three IT areas – Business Analytics, App Dev/Test and Security – that I actually expect will be very hot areas for cloud services adoption over the next two years.  In all three areas there are already some pretty compelling benefits to the cloud model.  The relatively poor showing could reflect both the need for better market education about these offerings, and the need for customers to see more offerings from the “household brands” in enterprise IT.  In any event, look for these three areas to steadily move up in our next several surveys.  Demand for Business Analytics and Information Security in the cloud will also be boosted as more data/content migrates to the cloud.

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16 Responses to “IDC Survey: What IT Is Likely to Move to the Cloud?”

[...] This post was mentioned on Twitter by Frank Gens, James Watters. James Watters said: RT @fgens: just wrote a new post: "IDC Survey: What IT Is Likely to Move to the Cloud?" http://bit.ly/7S5O5n #Cloud <–no data transform?? [...]

Good question! And some good answers, although I suspect some of those are more wishes than predictions

I always compare the Cloud with energy suppliers: gas and electricity are so boringly static products that you can easily cement them into the walls, ceilings and floors of your house. Include water too please

So, the more boring the IT, the better you can “Cloud it Out”. Infra comes to mind, storage, disks, security protocols, the roads IT travels on so to say

The closer you get to the user, the farther away from the Cloud. ERP, CRM? Forget it! SCRM? Not even invented yet, so don’t even think of it. HR? Sure, that’s really boring stuff, unless you have sexy cafetaria models and other customised goodies

Web apps on the other hand are already out there, and if they can scale, that’s a good reason to Cloud them

Is it boring? Toss it in the Cloud if you can save money on that. Is it large and can it be automatically provisioned? Is it new and just a try-out? Buy some Cloud power and demo away for a bit of time. Is it anything else? Think about it twice. And again. And again

Hi Martijn – I appreciate the comment, though I disagree with the idea that things that are close to the user, like CRM apps, aren’t appropriate for cloud deployment. The SaaS business is essentially a version of the cloud model, and what’s the #1 SaaS business app? CRM (see Salesforce.com et al.).

And the idea that static things are more appropriate for the cloud – I think the opposite’s going to play out… If you need the latest stuff, the cloud is where you’ll be able to get it faster. Already, cloud apps are updated by the supplier, and pushed out to users, on a cycle of weeks and months. This contrasts with the molasses-slow traditional packaged software version introduction pace, and even slower actual installation pace of customers – which is measured in years.

But Cloud certainly isn’t perfect for all things – as I posted recently, our surveys show customers still worried about security and manageability, among other things.

Best,
Frank

Frank, the results are very encouraging, considering that we are likely still in the early stages of “mainstream” market development for most managed cloud service offerings.

Case studies of the early-adopter proven benefits — particularly those that positively impact business competitiveness — are a big contributing factor in accelerated market adoption.

Agreed, regarding your point about the “need for better market education” — clearly, it’s a work in progress.

David Deans
Business technology Roundtable

Have you looked at the issues related with storing data in the cloud. This sounds particularly important for collaborative applications, but has legal, security and proliferation issues. I would be interested in knowing whether respondant are aware of those, as in the current cloud environment, they may become important barriers to adoption.

Hi Christian – great question and comment. We didn’t raise the questions of data security and compliance in this survey, but in client discussions I’m certainly seeing the more sophisticated customers probing how they can adequately address control/governance/compliance in the cloud.

No question, this is an immature aspect of the cloud landscape today, and it causes some hesitation about cloud adoption for many users (see our survey – Security was the #1 challenge). But it’s clear that solutions are on the way, and I see nothing inherent in the cloud services model that prevents suppliers from adequately addressing customers’ security and compliance needs.

Indeed, SPs are already offering geographically-anchored storage clouds (e.g., to address European data protection requirements). And I expect we’ll see the emergence of more “compliance-certified clouds” as the market matures – particularly as we see more offerings from the traditional hosted/outsourced services players, who already have to support customers’ strict security and compliance requirements. These will be priced at a premium, of course, from “good enough” cloud offerings.

One interesting conclusion, as these offerings develop, is that the cloud will likely become a preferred route to ensure compliance. For many customers – especially in the mid-market and below – using a compliance-certified cloud offering will actually be the fastest, simplest and most cost-effective way to ensure compliance. Again, we’ve routinely seen customers offload a lot of the heavy lifting around security and compliance to providers in the traditional outsourcing model; the cloud model simply brings greater efficiency to this kind of external sourcing.

Best,
Frank

Hi Frank, I am a regular reader of your blogs and ofcourse a great admirer of your research work and insights you have. I had opportunity to participate in your events when you was visiting India, at that time I was with IDC India.
With reference to your lates blog “IDC Survey: What IT Is Likely to Move to the Cloud?” I would like to know your more insights on movement of Application Devlopment & Test Environment on Cloud.
1. What kind of development & Testing environment/platform / tool shall be moving to cloud
2. What kind of devlopment / Testing work shall be moved to cloud
3. What kind of new services shall emerge across cloud in this area and how market become disruptive w.r.t. conventional application development life cycle.

Appreciate your insights.

Thanks

Sumant Parimal
HCL Technologies, Noida, India

Hi Sumant – thanks for the kind words… I appreciate your readership!

From my 20k-foot view, it’s clear that much of the dev/test in the cloud – both offerings and adoption – thus far has been driven by cloud SPs/.coms, many of them startups. But, as the cloud goes more “mainstream”, we’re already seeing expansion of Cloud dev/test offerings to, and adoption by, more traditional enterprises – supporting more traditional enterprise tools and platforms in the cloud.

But rather than play the role of IDC expert on Test/Dev, I’d refer you to our leaders in this area – who are both on IDC’s cloud research team: Rona Shuchat (http://bit.ly/8Dc0OW) and Melinda Ballou (http://bit.ly/5ks8×5). They’ve been analyzing demand for “Testing as a Service” (aka Test Clouds), and know the market inside and out.

Best,
Frank

Hi, I am a subscriber to this blog and appreciate the research and analysis that IDC shares here.

I would like to make a couple of comments:
1) In addition to the categories of applications that were asked in the survey from participants, many enterprises are also reviewing existing hosted solutions as candidates to move to Cloud services. In this case, cost is not necessarily the driver, but new requirements/enhancements trigger change.

2) With regards to Dev/Test in the Cloud, IBM’s foray into public Cloud (http://www.ibm.com/cloud/developer) is a good indication that there is a market need, and customers are or will be asking for it.

IBM’s Cloud service offers pre-configured images of WebSphere and Rational tooling for building solutions on top of their platform. It offers enterprise customers familiar tools already deployed in their environment on IBM’s hosting center. Developers can rapidly provision a wide variety of pre-configured WebSphere and Rational tools for modeling and design, SCM, defect tracking and reporting, etc for functional and load testing of different kinds of Java EE Web apps. Once the solution is tested and ready, it is deployed to on-premise WebSphere application server in pre-prod or production environment.

Babak Hosseinzadeh

Frank.

Very interesting post, thanks for sharing these results. I have a quick question, regarding your comments on security shifting to the cloud. Do you get a feel for what customers really mean when they say that they want security in the cloud? Is this primarily about the IT infrastructure dog wagging its security tail (e.g. since my storage, compute infrastructure, collaborative apps, business intelligence are all moving to the cloud, so is my information security to secure them)? In that case, the security market will simply follow the new cloud IT infrastructure services. Or, is the customer saying: “security is too complex and specialized. I cannot hire enough talent to do it right, so I am ready to shift my Information security (end point protection, web and mail security, IAM, threat and vulnerability management, etc) to the cloud?” If the answer is both, did you get a feel from the respondents where the most pressing needs were when it cam to security?

IT services are very important my company provides the service. I am interested to know that respondent are aware of those, as in the current cloud environment, they may become important barriers to adoption.

I note that this (like other IDC surveys) is somewhat forced to a positive response — “3″, which in most such polls is neutral on a 1–5 scale (”Neither likely nor unlikely/Don’t know”), is specified as mildly positive (”Somewhat likely”) here.

It might be more revealing to count only 4s and 5s.

Thanks for sharing post

hcl company is a very well known company all over the world.

[...] IDC’s Survey: What IT Is Likely to Move to the Cloud? – by IDC January 2010 [...]

I personally feel that cloud computing, it should be lightweight and secure distributed. For small sites, they need a secure operating environment, but also need a good price advantage.

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