Enterprise Cloud Adoption 2022-23

Abstract

It is safe to believe that the pandemic was a blessing in disguise for the cloud adoption markets. Businesses had no choice but deploy remote working and monitoring infrastructure as far as possible so that the dependency on manual processes is minimal.

To give a quick run-through, the cloud spending grew by 37% in the first quarter of 2020. Remember, at this time the world had just woken up to the viral effect of corona beyond China. Capitalizing upon this urgency to drive the processes remotely and securely, cloud service providers had an unlikely successful year.

“Pandemic will harness growth and will drive enterprises towards full adoption to a wider cloud regime which would help the industry breach the $ 1 trillion mark by 2024.”

Both, Public and Dedicated “cloud as a service” models are expected to witness immense growth in terms of revenues during the above period. IDC further predicts the majority of the contribution to this growth to come from “as a service” products. It also states that due to the availability of a bigger market, the industry will enjoy a growth rate of 8.3% CAGR. IDC identified increased usage of automation in cloud migration as a reason for this comparatively slow rate of growth.

U.S cloud comuting market size, by end use, 2016-2017 (USD Billion)

In the following whitepaper, we walk you through the key drivers that would further enhance the adoption of cloud products and services across the sector and nations.

Cloud Adoption in 2022 & Beyond

Rise of Platform as a Service (PaaS)

Platform-as-a-Service (PaaS) provides infrastructure to develop and store applications in the cloud thereby eliminating the hassle to execute the same on in-house resources. This makes it easier for businesses to drive a range of services such as strategic storing of data (database management), end-to-end development, and testing of apps, operating systems.’

• Global PaaS market will grow at a CAGR of 24.17% uptil 2023 valuing USD 28.4 billion – Market Reports World

Over the years, SMEs have extracted the on demand tools to build innovative products at lower costs. This is exactly how underfunded start-ups run by micro teams have been building enterprise grade products and resolved critical issues around.

Windows Virtual Desktop (WVD) is an interesting use case of Azure PaaS that allows the resources to use the virtual desktops without having to install in local systems. During the pandemic, businesses migrated to virtual desktops to enable remote working for teams.

The growing availability of PaaS assures faster time-to-market and minimal dependency on infrastructure management resources. Subsequently more options and fewer costs will make it a continuous practice across sectors.

Edge Computing

Mainstay in the Design to Security Approach

As more devices are connected with each other using the internet, most of them are at the risk of getting attacked for data theft. Chief Security Officers (CSO) are adopting DevSecOps using the “Design for Security” approach and Edge is becoming a primary choice for them to enable secure cloud-based solutions.

This is a primary objective for them since cloud architectures alone are not reliable enough to fight multiple attacks which may cause service disruptions in big data transaction processing, virtual or augmented reality experiences or operations via autonomous solutions.

One major distinction between edge security and non-edge security lies in the large scale deployment of systems to run applications on multiple devices using multiple connections.

• A recently released Omdia edge report projects that by 2024, this number will reach 5 million servers out of which 26% will be shipped servers.

No matter it will be easier for the devices to send data securely to the cloud using Edge, it will prove to be a much difficult task to send back data securely to the devices.

Hence, with the presence of several devices interconnected with each other within the framework of the Edge, it gets very difficult for the IT team to anticipate upcoming security threats.

Mobile Edge Computing

The advent of smart devices such as Smartphones and tablets and their excessive usage in real-time access to social media has played a significant role in the growth of the mobile edge computing market.

As the need for interconnected devices has swelled, it has led to an upswing in the demand for telecom and network services. Telecom Operators are upscaling their network bandwidth continuously for uninterrupted services that are contributing to garnering more market share for mobile edge computing.

Mobile edge computing minimizes network congestion since they bridge the gap between the data and the end-user and relays it directly to the mobile device.

• Price Waterhouse Cooper, meanwhile, predicts that the market for edge data centers is expected to almost triple by 2024. The global edge market for edge data centres will surge to $13.5 billion in 2024 compared to $4 billion in 2017.

With a widely available 5G network, data will be processed on the network edge without any disruption specifically when integrated with mobile edge computing (MEC). With private players like Ericsson and Nokia filling the gaps in the technology at a faster rate, 5G density will improve significantly.

Some relevant use cases in these conditions include AR/VR for remote inspection, surveillance, and remote monitoring

Organizations that are looking to store data onsite will additionally require the capability to process data locally. This can be achieved with edge AI chips which allow them to perform all the processing online.

Advanced Analytics – AI Apps on the Rise

In 2021, new cloud-based platforms like image recognition tools, recommendation engines, and language processing engines will elevate user experience across industrial products and services.

Addressing unforeseen customer needs, large numbers of enterprises are witnessing unusual spikes in support requests. Deploying AI-based Speech and language recognizing models can enable marketing and service functions to revert promptly to easier questions.

This will help the service team handle complex queries faster and more efficiently. Moreover, service department can achieve better deflection rates, shorter handling time and will lead to minimal resource training cost.

Enterprises can serve customers by installing Chatbot-based services within a few days to cater to customers effectively. This is more critical for organizational success in the post covid19 times.

Such models are developed to deploy front-line responders running across the day and night through chat or over the phone.

• The global Cloud-Based Business Analytics Software Market was valued at $28,854 million in 2016, and is projected to reach at $57,055 million by 2023, growing at a CAGR of 10.2% from 2017 to 2023

Moreover, machine learning harnesses logistical processes to keep cloud services uninterrupted.

AI helps in running these cooling systems, networks of hardware, and power control devices without any glitch. It is expected that more research in the field of AI and machine learning will contribute towards the development of the more innovative solution.

The Imperative Need to Rationalize Data Warehouses

Legacy data warehouses are not prepared to handle the current upsurge in data growth and don’t process advanced analytics smoothly and accurately. These data warehouses come with a huge price tag and soon get outdated to curtail the growing demands in business analytics.

Hence, updating database warehouses based on agility and accuracy with server-less analytics can be a permanent solution for tackling these issues in lieu of fast shifting customer behaviour.

Cloud data warehouses retrieve data packets faster and perform actions at hyper speed. Therefore, enterprises will be more efficient, accurate, and enlightened to take critical decisions using cloud data warehouses.

• Cloud-Native Tech will Spike

In the given below tasks, Containers, Kubernetes and server-less cloud-native technologies will contribute significantly

• Building Infrastructure

Migration

Rationalize client servicing tools and apps

In the pre-pandemic era, 19% of developers adopted server-less services and 22% deployed containers while building application software on the cloud.

The report states in 2021, regular container usage will stand at 28% and serverless technology will be used by 25% of developers. It is also highlighted that AWS, which has a lion’s share in the market, with other player players like Azure, Alibaba, and Google, will witness a very high demand for Faas and Caas

Rewriting Enterprise Cost Models Increased Reliance for OpeX

The pandemic has most adversely affected the cost decisions for all. To backup for another pandemic like holocaust, organizations have begun rewriting their cost models. They are seeking roadmap revamps to deploy flexible and more impactful cost models especially in those payas-you-go services.

With increasing preferences for OpEx, businesses can achieve total control over their spending. Since cloud systems account for unmatched flexibility of processes, enterprises no matter how big, are not hesitating to cut costs and pick cheaper alternatives.

Entities, both government and private are likely to upscale their infrastructure capacity in 2022-23. At the same time, they would want to keep the costs in control. Therefore, hybrid cloud systems backed by OpEx cost models will set the narrative for data storage and monitoring.

Hybrid Cloud – Best of Both Worlds

The cloud computing facet exponentially gained momentum after public and private cloud systems were collaborated in an organization’s system landscape. Using private and public clouds or multiple clouds (private or public) at the same time allow for distributing workloads to different systems as per risk sensitivity, volatility, and confidentiality.

Separating critical workloads from less critical workloads is an attested solution to achieve cost and maintenance optimization. For example, storing confidential financial data on a private cloud and other regular processes on a public cloud is the most common use of a hybrid architecture.

• Dynamic or frequently changing workloads
• Big data processing
• Moving to the cloud at your own pace
• Temporary processing capacity needs

Despite their popularity in the pre-COVID era, their adoption will grow starting with 2021. Such integrated management environments

• The Global Hybrid Cloud Market sizeis projected to grow at a Compound Annual Growth Rate (CAGR) of 11.78% to reach USD 128.07 billion by 2027. – Research & Markets

Going Forward

Keeping Intact onto the Basics – Addressing the Complexities in the Cloud

System migrating from on premise to those high performing cloud environments has been the most visible transition across small, medium and large scale businesses. In fact, 80% of Fortune 500 companies use Microsoft’s Azure Cloud.

While cloud adoption will continue to grow explosively towards building newer and smarter platforms, enterprises are now looking forward to addressing more complicated issues. With enhanced customer engagement at the centre, digital transformations will make use of multi-cloud platforms.

Not just this enables the enterprises to seek the best from multiple services; MSPs have discovered a bigger opportunity in consumptionbased pricing models. Nevertheless, server migrations to the cloud which has been the core revenue model for most MSPs will stay intact.