Cloud Becomes The Motivator In 2015

We’ve been seeing for years in our surveys, that business users and application developers are the primary consumers of cloud services. SaaS and cloud platforms are not infrastructure or alternatives to the corporate data center but are instead application services your organization leverages to create new user experiences and greater efficiencies that maximize profitability and derive trends that result in business insights.
 
In 2015 this realization will become a motivator for vendors and enterprise CIOs to focus their cloud strategies on empowering business and developers first and put aside their own concerns and priorities. In 2015, cloud adoption will accelerate and technology management groups must adapt to this reality by learning how to add value to their company’s use of these services through facilitation, adaptation and evangelism. The days of fighting the cloud are over. This means major changes are ahead for you, your application architecture, portfolio, and your vendor relationships.
 
What changes are coming in 2015? Forrester clients can read our 10 cloud predictions of what will happen in the coming year along with our recommended actions. For non-clients here’s a look at two key predictions we are making:
 
1. Microsoft Will Make More Profit From Cloud Than On-premise
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As OpenStack Stabilizes Big Questions Remain for the Foundation

At its Paris summit, the OpenStack community celebrated the 10th release of what has become the leading open source Infrastructure as a Service cloud platform software. What stood out about this latest iteration and the progress of its ever-growing ecosystem of vendors, users and service providers was the lack of excitement that comes with maturity. The Juno release addressed many challenges holding back enterprise adoption to this point and showed signs that 2015 may prove to be the year its use shifts over from mostly test & dev, to mostly production. Forrester clients will find a new Quick Take on OpenStack that analyzes the state of this platform and recommended actions here. In this blog post we look at looming questions facing the OpenStack community that could affect the pace and direction of its innovation. 
 

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Grading Our 2014 Cloud Predictions

This time last year, we published our predictions of what would be the major events and changes in enterprise cloud adoption in 2014. In this post, we look back on these prognostications to see which came true, which are still pending and which missed the mark. Look for our 2015 Cloud Predictions in the next few weeks. Thanks to Dave Bartoletti, Ed Ferrara and the rest of the Cloud Playbook team for their contributions.

So how did we do on our predictions in fall 2013:

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Use The Cloud For Success Down Under

Pop Quiz: If your company has conquered North America and Western Europe and is now looking for the next big market, where should you go? The no-thinking, because it’s obvious, answer is of course China. But if you want low cost of entry and a rapid return on investment you might want to aim a bit further South - to Australia.

While it isn’t as big a market as China (or even India) and may have a higher cost of living, which can make establishing a beachhead there expensive, Australia has significant enough similarities to the western world — a well-educated populace, a high income citizenship and desire for new technologies and innovations — to make success here far easier. And if you are doing ROI calculations around this decision, it has a key advantage over its Asian peers: higher acceptance of cloud services. 

How does greater cloud-readiness translate into higher ROI? Because your company can leverage cloud-based services to reach and serve Australian customers faster, cheaper, and with a better economic model that maximizes the profitability of crossing shores. And in our latest Forrester report, we show you how Australian companies are using the cloud and achieving success through this activity.

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IBM’s Cloud Platform Strategy Is Getting Legitimate

After a slow and somewhat disjointed start, it looks like IBM is starting to build some serious momentum in the Public Cloud Platform game. 

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What’s Your Cloud Future?

We know that cloud services and cloud platforms are here to stay and should be considered part of your overall IT portfolio but how much of that portfolio will these services occupy in your future? For most companies – and probably all enterprises - your future won’t be 100% cloud. And your business units and line employees have already ensured that it won’t be 0% cloud. So what’s the right number?

Answering this question isn’t as important as understanding how to prepare your organization for the percentage to be higher than you think it will be – that’s where you should be prioritizing.

On July 9th and 14th, I will be conducting a two-part webinar series for Forrester clients on The Future of Cloud Computing that will help you better understand how this market is moving, how your application portfolio is evolving and what you should be doing about it.

The research behind this webinar series comes primarily from three recent Forrester reports that are recommended reading for those planning their Cloud Playbook. They are:

·      The Public Cloud Market is in Hypergrowth – this report details the rate of cloud services adoption today and our forecast for cloud services between now and 2020. In this report, we discuss the factors affecting cloud service adoption and the patterns of use, which are key to understanding how your company is shifting to the cloud.

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How Cloudy Are Your Cloud Service Provider Partners?

There’s no shortage of companies these days calling themselves cloud service providers (CSPs) but are they really? And if not, what value do they bring to your portfolio and the cloud landscape?
Following up on our recent cloud services market forecast, our latest report helps CIOs understand the CSP market landscape. It breaks down the CSP market into its three tiers (see Figure 1 below) and its various business model approaches so you can evaluate your existing and potential partners and understand what value they will bring. The market is composed of three tiers of providers, based on size, investment and R&D capabilities and geographic reach. The market was historically dominated by traditional managed service providers (before cloud came into vogue) but the market is heavily under disruption today by the pure-play cloud providers. In addition to SaaS providers, “SaaS” providers, cloud platforms and “cloud platforms” there are a slew of CSPs who may not deliver cloud services themselves but can make it easier for you to consume true clouds. 

The CSP market is three-tiered and under disruption by pure-play cloud providers

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Top 10 Cloud Challenges Facing Media & Entertainment

 

With video rapidly becoming the dominant content type on enterprise networks the issues being faced in the media market foreshadow the coming challenges for the rest of the market. And use of the cloud was very much in focus at the 2014 National Association of Broadcasters conference held in Las Vegas in the second week of April.

Most industries need a push to move aggressively into the cloud  -- and the media & entertainment market was no different. The initial push came from the threat of disruption by over the top (OTT) distributors, like NetFlix, who were primarily leveraging the cloud. “[We] aren’t going to be cold-cocked like music was,” said Roy Sekoff, president and co-creator of, HuffPost Live. As a result, video production houses, news organizations and television and motion picture studios are being the most aggressive. Now an upcoming shift to Ultra HD presents a new series of challenges including file sizes, bandwidth limitations, and new complexities for workflows, visual effects and interactivity.  

Here we present ten issues the media industry faces as it more broadly embraces the cloud, as observed first-hand at NABShow 2014. These ten issues show how going cloud changes how you think (planning), act (workflow), and engage (distribute). For Forrester clients there is a new companion report to this blog detailing what the industry is doing to address these challenges and how you can follow suit:

Change how you think: Strategy and planning

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Cloud Computing Enters Its Second Stage - Hypergrowth Ensues

The public cloud services market exited 2013 with $58 billion in revenues according to Forrester estimates. Strong growth and maturity over the past three years since our last forecast has put fuel in its tank which will push this market to $191 billion by 2020.  

While the last several years can best be characterized as exploratory for most enterprises, cloud services and cloud platforms are now an undeniable part of the IT landscape. And based on Forrester enterprise CIO inquiries, the shift has begun from exploration of cloud as a potential option, to rationalization of cloud services within the overall IT portfolio. And this shift to the second stage of technology adoption yields significantly higher market revenues than the exploratory phase. Clearly the bulk of this market’s revenues come from Software as a Service (SaaS) solutions which accounted for $36 billion in revenue in 2013. This segment of the market is significantly more mature and well established in several application categories. Cloud platforms, led by Amazon Web Services LLC, were only collectively $4.7 billion last year but are maturing quickly thanks to stronger recent solutions from traditional IT partners IBM, HP and Microsoft. Drilling into the key market segments we see:

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Get Application Optimization Right in the Cloud Era

There’s a new and refreshing trend in my conversations with CIOs and IT leaders — acknowledgement that cloud services are here to stay and a desire to proactively start taking advantage. But to get this right takes the right approach to application portfolio optimization. And we’ve just released a new version of our Strategic Rightsourcing tool that helps you do just that.

The decision to proactive embrace cloud services is quickly followed by two questions:

  • How to prepare my IT organization to be cloud-forward?
  • What apps to move to the cloud?
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