Cloud expectations for 2013: From hype to hyper growth

Steve Caniano/AT&T Business Solutions
19 Dec 2012

Like earlier transformative phases in IT, the adoption of personal computing in the 1980s, client/server in the 1990s and the uptake of SaaS earlier this century, cloud has reached a similar tipping point that will create unprecedented opportunities for both new entrants and established vendors.

For many industry soothsayers, 2012 was going to be the year cloud went mainstream. Are we there yet? With IDC reporting that global spending on public IT cloud services will be more than $40 billion this year with a compound annual growth rate of more than 25%, it looks like 2013 will be the year that cloud pays off for many vendors and customers.

This represents a significant shift, from the "testing/development" stage that characterized a large share of enterprise cloud activity in 2012, towards a much broader adoption and deployment of cloud solutions. The evolution and rapid industrialization of cloud is transforming nearly every facet of information and communications technology.

Following are five key trends we see shaping the cloud landscape in 2013:

1.Increased adoption of applications as a service impacts capital expense

While not a zero sum game, we are already seeing the inroads cloud is making against capital expense allocated to traditional IT infrastructure. Businesses are seriously considering buying services on-demand rather than purchasing physical hardware (e.g. servers, racks, network switches, PCs ), software licenses and maintenance contracts. This shift is not only limited to public clouds, but also to private clouds, where more and more businesses are moving towards paying for X-as-a-service type solutions on-demand within their own datacenter or that of a provider. Part of this can be summarized as a trend towards a business model that favors op-ex rather than cap-ex. Conversely, cloud service providers are becoming much larger customers of hardware and software vendors.

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