By: Jamie Davies
Analyst firm Gartner has predicted more than $1 trillion in IT spending will be directly or indirectly impacted by the transition to cloud computing by 2020.
As IT spend steadily shifts from traditional IT offerings through to the cloud, a process which the Gartner team has coined the ‘cloud shift’, the rate in which enterprise organizations transition through to cloud is expected to gradually increase year-on-year. The aggregate amount of cloud shift in 2016 is estimated to reach $111 billion, though this will increase to $216 billion in 2020. The Gartner team believe cloud computing will be one of the most disruptive forces of IT spending since the early days of the digital age.
“Cloud-first strategies are the foundation for staying relevant in a fast-paced world,” said Ed Anderson, Research VP at Gartner. “The market for cloud services has grown to such an extent that it is now a notable percentage of total IT spending, helping to create a new generation of start-ups and “born in the cloud” providers.”
In terms of the specific segments, IaaS is the largest market accounting for $294 billion, though demonstrates one of the lowest levels of cloud shift through 2016, only representing a cloud shift rate of 17%. Business Process Outsourcing, or BPaaS, will represent the biggest cloud shift rate at 43%, though the expected market value through 2016 will be $119 billion.
Cloud Shift Summary by Market Segment
While the potential of cloud computing has been exhaustively discussed over recent years, one of the growing debates in the industry has been centred on the skills gap. Cloud requires not only new skills within the organization, but also a different approach in problem solving as well as a new business culture, should be benefits be realized. This challenge is currently being addressed by numerous organizations throughout the world.
“There is no doubt that cloud delivers unmatched business benefits in terms of usability, choice and agility,” said Angelo Di Ventura, Director at Trustmarque. “At the same time it requires wholly new skills and capabilities, and a complete IT transformation to maximise the value that businesses can gain from it – cloud can cause considerable disruption if left unchecked.
“The transition from an internet-enabled business to a digital business running in the cloud represents a huge jump for the majority of IT departments, whose existing infrastructure is designed for ‘business as usual’ operations. Ultimately, there is no one-size-fits-all model when it comes to making cloud work for a business.”
Jamie DaviesJamie is the Deputy Editor of BCN, having moved over from producing conferences covering the cloud and virtualization sectors for our parent company Informa. Jamie brings with him a strong understanding of the current trends affecting the enterprise IT world as well as an insight into what makes its companies tick and a fresh take on how to communicate all this to the outside world.