Globally cloud computing became a permanent part of IT leaders’ technology strategy in 2021. But the definition of cloud computing has expanded dramatically since the launch of Amazon’s Elastic Compute fifteen years ago. Today, companies purchase cloud computing services from multiple public cloud providers (multi-cloud). There’s a cloud ecosystem of software toolkits to support application modernization and multi-cloud environments. Approximately 65% of companies surveyed in the Lopez Research benchmark said their company is already executing a multi-cloud strategy today. We’ve also seen the emergence and adoption of vertical cloud solutions in areas such as finance and healthcare. For example, Bank of America worked with IBM to create a finance cloud. Healthcare clouds have also surfaced. We’ve seen Amazon Web Services and Microsoft battle for government business with specialized government clouds, and Google Cloud has also focused on verticals.
As a result, we’ve seen industries that we didn’t think would move to the cloud go all in. In 2021, industries and organizations that may have previously been more cautious with the cloud invested heavily in these solutions. For example, at Amazon’s Re:INVENT, NASDAQ shared how it was investing heavily in the cloud. Meanwhile, hardware vendors, such as Dell and HPE, announced hybrid cloud offerings. The technology industry also made amazing strides in processors and AI acceleration across the stack to support AI workload in areas such as banking and healthcare.
We’ve also seen the introduction of 5G as a service from hyper scalars. And, you know, we’ve also seen some of the challenges. Moving to a multi-cloud environment sounds more straightforward than it is. Companies face staffing issues and must navigate the complexity of learning multiple, vendor-specific cloud management methods.
Cost savings aren’t the primary goal of moving to the cloud. While price is important, enterprise buyers understand that a hybrid cloud represents flexibility and agility. The challenge for companies is navigating different workloads with different requirements.
I recently had the opportunity to interview Jo Peterson of Clarify 360 and Craig Chvatal at Intel on the topic of evaluating cloud strategies for a LinkedIN live. Peterson noted that companies are all in on the cloud and not stepping back from anything. According to Gartner, Infrastructure as a Service is projected to grow 36.8 percent to 895 million by 2022. She also shared data from a Statistica report that said in late 2020, 36 percent of enterprises indicated that their organization spent more than $12 million on public cloud every year. Overall, cloud spending constitutes 30 percent of the total IT budget. It’s a considerable sum for any organization.
What’s changed? At Lopez Research, I’ve seen the emergence of vertical clouds that offer compliance features and a set of hybrid cloud services. These hybrid services help organizations balance cost, compliance, and security while maintaining data gravity. Peterson said, “Hybrid everything is here to stay, particularly as it relates to cloud data and analytics.”
Chvatal agreed and shared that Intel has always taken a hybrid approach to cloud computing to support agility and cost containment. Leveraging the cloud was the only way Intel could rapidly shift to supporting nearly 100,000 employees working remotely literally overnight. “Without that burst capacity, we could have never done a hybrid (work) mode.” He noted that one of the things that Intel was excited about is that cloud providers are moving beyond basic infrastructure services to providing solutions. “(Cloud providers) are putting those services together in a framework. We’re very interested in (these frameworks) versus selecting individual services.
I asked both guests to share their thoughts on what to do with workloads that have become more complex and diverse today. Peterson shared that it’s important to realize that a discussion on cloud optimization is a discussion of creating business efficiency. It’s correctly selecting and assigning the right resources to a workload or application. Workload performance, compliance, and cost need to be correctly and continually balanced. We’re starting to see this delicate balance between the finance department, which wants to control the spending, and the application owners, who never want to hear that the resources for their apps are being reduced. As I spoke with Peterson and Chvatal, I realized that there are tangible optimization use cases for both public and hybrid cloud footprints. Chvatal shared his thoughts on balancing the complexity of the necessity to modernize while maintaining the legacy systems running your business. He discussed the importance of business process mapping to find inefficiencies and to decide what you’ll keep. There are three best practices to review: workload modeling, service matching, and optimization recommendations. It’s a lifecycle approach. These are just a few of the themes we covered. You can review the entire interview on LinkedIn here. For other insight on cloud services, check out this Elevate the Edge podcast.
