Cloud Surveys, and Extrapolating Out to Disruption

The other day a minor storm broke out amongst the clouderati that had its genesis in a post Krishnan wrote looking at who is likely to disrupt AWS (teaser – PaaS from one end and alternative IaaS operating systems from the other). Anyway – the bottom line from the disagreement was that while Krish and I both agree on the “what” of cloud disruption, we have different perspectives indeed on the “when”.

I was reminded by this difference of perspective when reading a post from the always entertaining Christian Reilly. Reilly talked of his recent presentation at a CloudCamp event during which he presented the slidedeck below and stated the blindingly obvious, yet newsworthy to many enterprises comment that;

Cloud is a journey. A new approach and a conduit for business transformation

So we all agree it’s a journey, that it’s a new approach and that new ways of doing technology will displace traditional ones. But before we all hold hands around the fire and sing Kumbaya – there’s no point talking potential and eventual disruption without being able to wrap some time constraints around it – and this is where cloud adoption surveys, with all their inherent flaws, can provide some guidance.

So with that in mind I was interested to read some results from the 2012 future of cloud survey published by North Bridge Venture Partners – now before anyone points out that surveys are inherently flawed, and that surveys by VC companies are both flawed generally and specifically because of the real vested interests that VCs have – I’d suggest that while I’d not make any micro investment decisions based on them, they are useful to illustrate more general trend. So.. to the survey

NBVP had around 40 industry collaborators survey close to 800 respondents to ascertain their key issues impacting cloud computing, including drivers for cloud computing, inhibitors, best practices, sourcing, hiring, total cost of ownership, cloud’s impact on multiple business sectors, and emerging cloud technologies.

Key Findings in the Survey include:

• Companies are accelerating their trust in cloud solutions, with 50 percent of respondents confident that cloud solutions are viable for mission critical business applications
• Scalability remains the top reason for adopting the cloud, with 57 percent of companies identifying it as the most important driver for cloud adoption.  Business agility ranked second among drivers for cloud adoption, with 54 percent of respondents focused on agility
• Security remains the primary inhibitor to adoption in the burgeoning cloud marketplace with 55 percent of respondents identifying it as a concern, followed by regulatory compliance (38%) and vendor lock-in (32%)
• Software as a service (SaaS) is currently, and is expected to remain the primary type of cloud investment, with 82 percent of respondents citing it as in use today, and 88 percent expecting to use it five years from now
• Platform as a service (PaaS) and infrastructure as a service (IaaS) will see significant growth in the next five years, with PaaS growing from 40 percent to 72 percent and IaaS growing from 51 percent to 66 percent
• The top 3 areas in which “cloud formations” are coming together are backup and archiving (43 percent), business continuity (25 percent), collaboration tools (22 percent), and big data processing (19 percent)
• The majority of respondents (53 percent) believe that cloud computing maintains a lower TCO and creates a less complex IT workflow
• Over a third of respondents (38 percent) claim no impact on IT hiring as a result of cloud technologies
• Currently, 40 percent of respondents’ are deploying public cloud strategies, with 36 percent emphasizing a hybrid approach
• Within five years, hybrid clouds will be the emphasis of 52 percent of respondents’ cloud strategies.

MyPOV

These statistics are always interesting discussion points – but they need to be taken with a healthy dose of skepticism – the responding companies are almost always at the bleeding edge of adoption and hence the trends they identify are valid, but need to be phase shifted a few years to draw any conclusions for the general market.

Which is all interesting given the discussions around the speed of uptake of PaaS and the question of who may unseat AWS. Specifically we can see the growth rates for PaaS over the next five years being greater than those for IaaS – this is understandable, PaaS comes from a much smaller base but also offers higher levels of value to customers and hence one would expect to see faster growth in this area. The other statistic of interest is the growth of hybrid cloud – this speaks to the opportunity for the more open cloud operating systems (OpenStack and CloudStack) – while it is true that AWS has penned an agreement with Eucalyptus that sees a degree of AWS-centric hybrid cloud available, my take is that the more open cloud OSs will offer a more compelling proposition to organizations that want to fully embrace hybrid cloud.

In short, I agree with Krish’s original premise that AWS faces threats from both PaaS and other cloud operating system vendors – but given that the respondents in this survey are indicating a five year time frame, coupled with the fact that these respondents can be seen as overly ambitious, and my guess is we’re overstating just how quickly this will happen.