Cloud Computing: Developing Strategy with a Digital Playbook

451 Research predicts that Cloud Computing Infrastructure as a Service (IaaS) will grow from $4.475 billion in 2013 to $10.23 billion in 2016, and that Platform as a Service (PaaS) will grow from $2.23 billion in 2013 to $5.24 billion in 2016. Michelle Bailey, VP of Digital Infrastructure at the 451 Group, said that “We remain very bullish about the [cloud computing] market. You’re going to start to see that cloud and hosting is going to be a bigger part of the IT portfolio going forward as we move into this next era. The expectations on all of us are going to climb. IT buyers will have higher expectations, IT suppliers expect higher levels of service.”

451 Research urges CIOs to develop a ‘digital enterprise playbook’ to help them map a strategy for reinventing their data infrastructure. Tony Bishop, Chief Strategy Officer for the 451 Group, said that “digital transformation is breaking down the barriers to sustainable global prosperity by shifting power towards the individual. This revolution will transform how enterprises create and deliver value. Digital enterprises will pursue and build dynamic infrastructure capabilities to innovate and differentiate customer experience, constantly empower employees and disseminate prescriptive knowledge across the enterprise.”

Cloud Dependency. Cloud computing already has made a big impact on many organizations. 80 percent of enterprises say that if they experienced a cloud outage for only a single day that they would experience a severe impact to their operations.

Hybrid Cloud. 451 Research expects that in the near term that typical enterprises will see roughly a split with 55 percent of their computing services on-premise and 45 off-premise. Bailey said that “what is going to be different, is that on-prem will be investments in private cloud. As they move off-prem, what is going to change is hosted private cloud. Customers are going to cloud in their own way. They’re not going to do it recklessly. We also know that hybrid cloud is going to be extremely important. Most customers are thinking in this manner, and this is why the investment in security is so important.”

Cloud Spending Categories. By 2015, 451 Research predicts that the top spending categories in cloud computing will be:

• Enterprise Applications (45 percent)
• Email (43 percent)
• Database (43 percent)
• Business Support Applications (39 percent)
• Collaborative Tools (25 percent)