Cloud Computing. January 2012 CONTENT COMMUNITY CONVERSATION CONVERSION
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1 Cloud Computing January 2012 CONTENT COMMUNITY CONVERSATION CONVERSION
2 Purpose and Methodology Survey Sample Field Work December 20, 2011 January 9, 2012 Total Respondents 554 Margin of Error +/- 4.2% Audience Base Survey Goal CIO Online To measure cloud computing trends among technology decision-makers including usage and plans across various cloud service and deployment models, investments, business drivers and impact on business strategy and plans. Survey Method Collection Number of Questions Online Questionnaire 23 (incl. demographics) 2
3 Respondent Profile Total Respondents 554 Organization Size Average Company Size 13,128 employees Average Annual Revenue $5.6 billion IT Leadership All survey respondents are involved in the purchase of IT products and services at their organization. Head of IT 64% Non-head of IT 36% Top Represented Industries High Tech Telecom & Utilities Government/Nonprofit Manufacturing (Hardware and Software) 12% 1 1 Job Title Breakdown Executive IT Management 29% Senior IT Management 44% IT Professionals Business Management 18% Other (Non-Manager) 3% Services Financial Services Education Healthcare Retail, Wholesale and Distribution 11% 10% 8% 8% 3
4 Cloud Computing Definitions Cloud Computing a model for enabling ubiquitous, convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. Cloud Service Models Software as a Service (SaaS) Employs the provider s applications running on a cloud infrastructure. The applications are accessible from various client devices through either a thin client interface, such as a web browser (e.g., web-based ), or a program interface. The provider manages or controls the underlying cloud infrastructure with the possible exception of limited user-specific application configuration settings. Platform as a Service (PaaS) Consumer-created or acquired applications supported by the provider are deployed onto the cloud infrastructure which the provider manages or controls. The consumer has control over the deployed applications and possible configuration settings for the application-hosting environment. Infrastructure as a Service (IaaS) The consumer provisions processing, storage, networks, and other fundamental computing resources where the consumer is able to deploy and run arbitrary software, which can include operating systems and applications. The provider manages or controls the underlying cloud infrastructure while the consumer has control over operating systems, storage, and deployed applications; and possible limited control of select networking components (e.g., host firewalls). Cloud Deployment Models Community Cloud Shares infrastructure between several organizations from a specific community with common concerns (e.g., security, compliance, jurisdiction), whether managed internally or by a third-party and hosted internally or externally. Public Cloud The cloud infrastructure is provisioned by the cloud provider for open use by the general public. It may be owned, managed, and operated by a business, academic, or government organization, or some combination of them. Private Cloud Infrastructure provisioned solely for a single organization, whether managed internally or by a third-party and hosted internally or externally. Hybrid Cloud A composition of two or more clouds (private, community, or public) that remain unique entities but are bound together, offering the benefits of multiple deployment models. It can also be defined as multiple cloud systems that are connected in a way that allows programs and data to be moved easily from one deployment system to another. 4
5 Majority Have Already Migrated to Cloud Plan to use cloudbased applications and/or computing infrastructure via the cloud within 1 to 3 years 14% Have at least one application or a portion of our computing infrastructure in the cloud 61% Plan to use cloudbased applications and/or computing infrastructure via the cloud within the next 12 months 2 Q. What are your organization s plans with regard to utilizing computing infrastructure or applications via the cloud? 5
6 Private Cloud Most Readily Adopted 30% 2 23% 2 20% 1 Private Cloud Public Cloud Hybrid Cloud Community Cloud 10% 10% 9% 9% 8% 0% 2011 (1,000+) 2012 (1,000+) Q. Approximately, how much of your organization s information presently resides in each of the following cloud deployment models? AND 18 months from now? 6
7 Rapid Growth Expected to Continue Private Cloud < % % Public Cloud <1000 9% 11% 14% 1 Hybrid Cloud <1000 6% 8% 13% 13% Now In 18 Months Community Cloud <1000 4% 9% Q. Approximately, how much of your organization s information presently resides in each of the following cloud deployment models? AND 18 months from now? 7
8 Cloud Computing is in the CEO s Sight Not a priority 1 High/Critical priority 40% Low priority 18% Somewhat important priority 26% Q. How important is cloud computing technology to the business agenda of your organization s CEO or executive management team? 8
9 Cloud Investments Driven by Business Strategy 8% Don't know 6% 30% Driven by business strategy rather than shaping it 43% 38% Play a role in shaping overall business strategy but are not a central focus 34% 2 Play a critical role in shaping overall business strategy 1 Business Management IT Q. To what extent are cloud computing technology investments shaping your organization s overall business strategy and plans? 9
10 Cloud Computing Enables Business Innovation 2 9% Very/Somewhat important Not very important Not at all important Q. How important is cloud computing as an enabler of innovation for your business? 10
11 Business Continuity & Speed of Deployment are Top Drivers 2% Enabling business continuity 43% 41% 10% 4% Speed of deployment 39% 44% 12% 2% 3% Greater flexibility to react to changing market conditions 40% 38% 12% Improving customer support or services 38% 41% 13% 3% 4% Reducing resource waste 3 41% 14% 3% Enabling innovation 33% 42% 16% 4% Savings on CAPEX 33% 42% 1 4% Gaining a competitive edge 31% 38% 1 8% Expanding revenue opportunities 31% 31% 21% 10% Need for real-time information 29% 39% 19% 6% 6% Replacing on-premise legacy technology % Development of new products or services 24% 41% 22% 6% Very Important Somewhat Important Not Very Important Not At All Important Not Applicable Q. How important are the following as business drivers of investment in cloud computing technology? 11
12 SaaS Leads Cloud Services Divide 8% Software-as-a-Service (SaaS) Infrastructure-as-a-Service (IaaS) Platform-as-a-Service (PaaS) Managed network services 4% Managed security services 4% Management/monitoring-as-a-service Q. What percent of your organization s total IT budget will be allocated to each of the following areas over the next 12 months? (1,000+) 12
13 Cloud Computing Budgets Increasing 33% of IT Budget Currently Allocated to Cloud-Based Services Computing with a +1 overall change in the next year. 6 Increase 76% Organizations to invest an average of $2.4 million in cloud-based services computing in the next year. 30% No change 22% Decrease 2011 (1,000+) 2012 (1,000+) Q. Do you expect the percent of your organization s IT budget allocated to cloud-based services computing to increase, decrease or remain the same over the next 12 months? Approximately how much will your organization invest in cloud-based services computing in the next 12 months? 13
14 Almost a Third Will Have Majority of IT Ops in Cloud Only a few selected IT operations will be performed in the cloud We'll limit our cloud activity to private clouds We'll limit our cloud activity to software-as-a-service (SaaS) 38% 31% 1 8% 3% Our use of cloud-based resources will be negligible The majority of our IT operations will be performed in the cloud Q. Which of the following best describes your long-term expectations for cloud computing at your organization over the next 5 years? 14
15 Long-term Savings Anticipated - But Calculating a Challenge My organization anticipates cloud will save us money in the long-term, however, we expect to realize higher short-term costs 60% 66% Accurately estimating or calculating OPEX (operating expenditures) resulting from cloud poses a challenge for my organization In general, cloud vendor contracts aren't structured to allow us to easily evaluate costs and/or ROI 58% 53% 58% 50% 1,000+ <1,000 Accurately estimating or calculating CAPEX (capital expenditures) resulting from cloud poses a challenge for my organization 53% 54% Q. Please rate your level of agreement with the following statements. (Strongly Agree/Agree) 15
16 IT is Strategic Partner When Purchasing Cloud Solutions 56% 68% 1,000+ < % 1 12% 3% 2% 2% 3% 3% Always, it's a requirement Often Sometimes Rarely Never Not sure Q. When business units/departments select their own cloud computing solutions and services, how frequently do they consult IT prior to making the final purchase? 16
17 Cloud is Driving IT Evolution 43% New roles have been created within IT/ networking to help develop and implement cloud computing strategy (rather than responsibility being absorbed into existing roles) 6 As a result of the use of cloud technology, the IT/networking function is more critical to my organization 70% The IT/networking function has had to rapidly expand its skill set/knowledge in order to keep up with cloud computing developments Q. Please rate your level of agreement with the following statements. (Strongly Agree/Agree) 17
18 Hurdles for Cloud Computing: Security, Access and Governance Concerns about the security of cloud computing solutions 70% Concerns about acess to information Concerns about information governance Difficulty measuing ROI of cloud solutions Concerns about the ability of cloud computing solutions to meet enterprise and/or industry standards Lack of clear strategy or help from key vendors in adapting their applications to cloud computing platforms Business leaders are not receptive to cloud computing solutions Employees are not receptive to cloud computing solutions 9% 12% 40% 3 34% 32% 2 Q. What are the top three challenges or barriers to implementing a cloud computing strategy at your organization? 18
19 Vendor Security Capabilities Key to Strategic Value Experience in establishing effective security policies and procedures in the cloud Proven post-sales support & service Experience in establishing effective governance policies and procedures in the cloud Offers the most cost effective model Ability to understand my business goals and objectives 83% 78% 7 73% 73% Experience in building and operating cloud environments in my vertical industry In-depth insight and expertise regarding cloud trends and direction Innovative ideas Ability to differentiate their portfolio from that of their competitors Knowledge of how my organization operates/ organizational structure 6 60% 54% 51% 53% Prior experience with this vendor 3 Q. Please rate the importance of the following factors when evaluating cloud computing technology vendors as a strategic partner for your organization? (Critical/Very Important) 19
20 Room for Cloud Leaders to Emerge IBM Amazon Microsoft Google Salesforce HP VMware Rackspace Oracle/Sun Cisco Citrix EMC Dell Verizon Terremark Apple Savvis SAP Other Not sure 3% 3% 4% 4% 3% 4% 3% 4% 3% 2% 3% 3% 3% 2% 2% 2% 2% 1% 6% 6% 11% 10% 13% 11% 12% 19% 20% 21% 2 24% 24% 24% 2 28% 29% 30% 1,000+ <1,000 40% Q. Which vendors do you consider to be thought leaders in the area of cloud computing? 20
21 Conclusions Migration to the Cloud is on solid ground and continuing. Private cloud is the most readily adopted, but public and hybrid are clear growth areas. Cloud budgets are expected to increase in the next year and spending will be divided among different types of cloud services. Cloud is expected to provide cost savings in the long run, however, it is difficult to calculate what those savings might be. IT is almost always consulted when business units/departments make cloud purchases. Cloud is driving the evolution of the IT department by requiring them to become more critical across the organization, develop new roles or acquire new skills. Establishing security in the cloud is key when it comes to vendor selection. 21
22 22 Appendix
23 Involvement in the Purchase Process for Cloud Determine the Business Need 72% Determine requirements 6 Recommend and select vendors 6 Evaluate 72% Sell internally 43% Approve/Authorize 54% Q. In which of the following ways are you involved in the purchase process for cloud computing solutions at your organization? 23
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