The Troposphere

Mar 8 2012   8:11PM GMT

Yup, your cloud hunch was right

Michelle Boisvert Michelle Boisvert Profile: Michelle Boisvert

Everything you’ve read about who is using cloud computing and why is pretty much true, so says at least one industry study.

According to a recent Cloud Industry Forum survey of 400 public and private companies of varying sizes, flexibility is the number one reason U.S. companies adopted the technology in 2011. Cost savings eked out second place.

Of the 31% of respondents who listed flexibility as the top reason for adopting cloud computing services, the majority were SMBs — tiny companies with up to 20 employees up to those with 100 to 999 employees (40% and 41%, respectively). Such companies tend to have limited in-house technical resources, and cloud offers self-service capabilities, on-demand scalability and the ability to quickly launch new services that might otherwise be delayed or pushed to the backburner completely.

Big companies with more than 5,000 employees (28% of respondents), on the other hand, looked to save using cloud services. And now the tables have turned slightly on who’s driving cloud services adoption. When cloud computing first started to catch on, business users were waving their flags for all things cloud. But once IT bigwigs — CTOs and CIOs — caught wind of cloud’s potential cost-cutting benefits, they started pushing for it too, according to Andy Burton, chairman of the Cloud Industry Forum (CIF) and CEO of Rise.

The ability to use cloud technology to launch a completely new service was a draw for 22% of respondents, while only 8% looked to cloud to either offset a lack of internal IT or because it was seen as a low-cost project.
Cloud = happiness for most adopters
Companies that jumped into cloud in 2011 must be seeing its benefits; 94% of respondents who adopted cloud have plans to expand cloud services in the next 12 months, according to CIF. The targeted apps? Email, asset management and security. Email and data storage applications will see the biggest push to the cloud in the next year, at 50% and 45%, respectively.

Burton said really big companies have moved resource workloads such as storage to the cloud because they know they can save money there. Smaller companies stick with simple apps like email. 
Once the warm and fuzzies pass, cloud concerns set in
Setting aside their love for cloud technology, plenty of IT pros are still nervous about trusting their data to others.  Top worries were data privacy and data security (56% and 53%, respectively). But these apprehensions will only cause companies to hesitate on adoption, not dismiss the idea completely.

“This may limit what companies put into the cloud and it will slow adoption rates,” Burton said. “People still have a tendency to want to know where their data resides.”

U.S. companies have made the boldest moves to the cloud. Their adoption rates are at 76% of those surveyed versus 53% of U.K. respondents. That may have much to do with EU data privacy laws that give end users the right to anonymity. Basically, a service provider has to give users the ability to remove content. And cloud services providers can’t guarantee that yet.

One surprise, in the U.S. cloud market, the largest companies are least concerned about this. According to the study, those least comfortable about privacy issues in the cloud are small private companies and public organizations.

Rise, the channel division of Fasthosts Internet Group with headquarters in the U.S. and U.K., was the sponsor of CIF’s “USA Cloud Adoption & Trends in 2012” survey.

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  • steveto
    I understand that many corporations are turning to cloud services, but now cloud is becoming more generalised. It would be more beneficial to break it up and cover adoption numbers of the different market segments as well as the type of cloud service being adopted. For example, What industry is adopting what? Is the heath industry gearing more towards cloud applications as their main form of adoption or are they adopting a more infrastructure level (IaaS)? Lumping all cloud services together doesn't give quite as clear a picture of adoption rates as one would think. It could be that infrastructure isn't being adopted because SaaS is more beneficial while keeping traditional infrastructure in-house and just outsourcing for specific application cloud hosting. What do these corporations tend to adopt first and why? These are the type of questions that come to mind. Steve
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