Analysts estimate only 15% of IT spend is in the cloud, but 90% of businesses have implemented cloud systems. The mismatch highlights how much room there is for growth, especially around core app modernization.
Experimentation is giving way to specialization as more companies grow their cloud-based workloads. Yet there is room for growth and expansion. Many trends of 2022 echo those of years past, but this year will lead to more specialized adoption as companies evolve and formalize their strategies.
Here are the trends that will shape cloud use in 2022:
Natural growth plateau
IaaS providers have comfortably had a double-digit market growth, driven by initial service adoption. Though a land-and-expand strategy can fuel customer tool adoption and vendor buy-in, consolidation of infrastructure- and platform-based services is reshaping the market.
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The lack of service separation could slow revenue down if vendors don’t think about the innovation upside to consolidation and what they need to provide to customers to maintain growth. Industry has seen an example of stalled growth before the enterprise resource planning market enjoyed popularity and widespread adoption, but then innovation died.
Monolithic ERP systems are cumbersome, making modernization difficult. While the technology became more composable, timing upgrades and modernization is an art. IT is archaeological, with civilizations of applications buried under layers, which contribute to technical debt. With smart acquisitions, companies can reduce technological debt by leaking cloud space and utilizing resources, which will pave the way for innovation. Any cloud provider that can support that will continue on their growth paths, for at least the next five years.
Maturity Makes room for cloud optimization
The post-pandemic uncertainty has led to further investment in technology, a trend that will continue this year. The IT budget is expected to increase by 3.6%, the largest increase in a decade.
Concerns about how to manage technology are associated with investments and, as cloud debt grows, businesses are considering spending more money. As cloud adoption goes from trial to integrated investment, businesses are looking at how they can use their money with clouds, says Brian Adler, chief executive of cloud marketing strategy at Flexera. Many businesses look for savings plans, set conditions and committed user discounts.
The uncertainties associated with a long-term contract commitment to the cloud are eased. Next, business leaders should look at planned discounts.
Multi-cloud strategies taking the lead
The private, public or mixed cloud has dominated the industry for some time, preferences fluctuating due to technical requirements or security concerns. Multi-cloud strategies reach multiple providers, targeting providers with multiple tasks.
From the gradual accumulation of cloud resources, to the highly controlled and robustly planned acquisition. In many cases, organizations are looking at individual providers, but are also concerned about the appearance of each market.
Businesses are navigating cloud limitations, from the service point to the edge analysis support.
Organizations will integrate conditional operations and more work within the core supplier base, but consideration of operational responsibility may encourage the acquisition of more vendors.