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The Criticality of the Cloud: Why the World’s Businesses are Sourcing, Adopting, and Connecting to Cloud-First Resources

4 March 2021

The cloud is no longer disruptive. It’s weaved its way into our everyday processes and operations, and has become a critical part of our business and IT strategies. There’s no doubt that the cloud has driven a divide between those who were quick to adopt and those still lagging behind, yet to embrace the possibilities unlocked by a cloud-first approach.

With 92% of organizations’ IT environments at least somewhat in the cloud, and close to half (46%) of organizations’ cloud-based applications considered cloud-first having been purpose-built for the cloud, organizations are realizing that integration of cloud computing is now a non-negotiable.

With a focus on the cloud-oriented business landscape which has now become our reality, we discuss adoption and usage trends, the edge enabling remote connectivity, and the empowerment of underserved markets with expanding cloud on-ramps.

Evolving cloud options supporting business workloads

Not only has cloud usage become an integral part of business strategy, it’s acted as an inevitable catalyst for industry growth and innovation, so much so that Google believes cloud will triple in the next five years, expecting revenue to surpass $1 trillion by 2026/27.

New business and technology drivers are set to propel this massive growth in the cloud market, which include the rapid digital transformation across industries as accelerated by Covid, and emerging needs for multi-cloud, cloud native, data and analytics, and AI-driven processes, according to IDC.

Gartner’s VP David Mitchell Smith also says that, “As it enters its second decade, cloud computing is increasingly becoming a vehicle for next-generation digital business, as well as for agile, scalable, and elastic solutions.”

So, with cloud becoming no less than essential to the operation of many digital functions, trends have inevitably emerged in terms of the technology’s adoption and the way enterprises are utilizing it.

Hybrid cloud solutions have been a popular choice among global businesses who recognize the criticality of this digital technology, and wish to take advantage of private and public cloud benefits.

In fact, according to NTT’s 2021 Hybrid Cloud Report, 60.3% of APAC organizations are already using or piloting hybrid cloud, while 31.6% plan to implement a hybrid solution within 12-24 months.

This cloud option can provide relatively faster deployment of apps and services, improve overall business agility, and reduce IT operational costs, incentivizing a large proportion of global enterprises to source this solution.

Multi-cloud is another viable cloud strategy for businesses which was more popular among cloud users than hybrid cloud in 2019, according to a report by Kentik.

In 2020, more than half (55%) of respondents in IDG’s Cloud Computing Survey used multiple public clouds, with 34% of companies using two, 10% using three, and 11% using more than three public clouds.

The survey also found that nearly half (49%) of respondents adopted a multi-cloud approach to get best-of-breed platform and service options, ensuring they receive the best quality offerings available.

Cloud moves closer to the edge to service critical workloads

Since the pandemic’s outbreak which saw many businesses turn to digital functions, enterprises have continued to move larger and more critical workloads to the cloud, and have next to no time for delays when undertaking these migrations.

This demand for cloud and low-latency connectivity has been felt by CSPs around the world for some time now, and has prompted a rollout of edge nodes to a multitude of locations across the globe.

According to Cloudscene’s H2, 2020 Data Center Center Ecosystem Leaderboard Results, cloud on-ramp growth has increased significantly in North America, EMEA, Asia, Oceania, and Latin America, with all of these regions experiencing year-on-year (YOY) growth from 2019 to 2020.

Collectively, 214 on-ramps were added into CSPs’ ecosystems during this year, meaning there are now that many additional on-ramps where businesses can connect to the cloud across these international locations.

By allowing compute and storage to be brought closer to where businesses reside, edge computing is becoming critical to cloud users as they are able to avoid the need for ‘hair-pinning’ traffic back to their cloud environments from an on-ramp outside of their location.

With so many businesses sourcing cloud solutions that tap into the benefits of edge computing, those who don’t adopt this technology are sure to be left behind. As Gartner’s VP Analyst, Elias Khnaser, put it, “If you have not developed a cloud-first strategy yet, you are likely falling behind your competitors.”

Connecting underserved markets through widespread cloud adoption

With service providers constantly expanding their global footprint, their focus is shifting to the underserved markets which are attracting the attention they deserve and the cloud technologies they require to bolster their digital economies.

As cloud on-ramps are built, edge nodes are deployed, and global businesses establish themselves in new locations around the world, emerging markets are gaining easier and faster access for harnessing all that cloud has to offer.

For instance, we’re starting to see connectivity play out in big ways in Africa’s emerging data centre market, LATAM’s gaming market, Vietnam’s digital revolution, and in much of Asia where two billion people are yet to connect to the Internet.

Businesses in these underserved markets are finding their path to the cloud and getting connected, empowering not only their economies, but the rest of the world with which they are digitally connecting.

As organizations continue to source cloud and connectivity services to drive their operations, there’s no doubt that they will continue to be the bedrock for business moving forward. And for those who don’t embrace the technology, well, good luck catching up.

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Backed by highly comprehensive industry data, Cloudscene enables you to search and match with global vendors – wherever and whenever you like. Learn more about sourcing on our platform here or create a free account and start listing your requirements on Marketplace.

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