Regional CIOs are increasing their spending on public cloud services and technologies in 2013 by 50 percent to $7.5B; and being much more specific about which types of cloud models they will use and the workloads that they will run on the cloud.
These were key findings in IDC?s 5th annual survey of end-users and their adoption of and plan for cloud services in Asia Pacific excluding Japan (APEJ).
In 2013, 39 percent of survey respondents indicated that their spending on all types of cloud technologies and services would be between 5 percent and 30 percent of their total IT budget, with a further 7 percent indicating that their spending would be between 30 percent and 40 percent of IT budget.
For 2015, the share of IT spending directed to cloud increases ? and noticeably, the number of respondents which indicated that they would not be allocating any budget to cloud dropped from 22 percent in 2013 to just 1 percent in 2015.
“This shift to cloud services is not uniform. We have variations by country as well as by deployment. China?s spending intentions are clearly for on-premises private cloud investments, while Singapore and Australia will spread spending across public, private and hosted cloud services, delivering a hybrid cloud environment by 2015,” said Chris Morris, IDC’s AVP for cloud services in APEJ.
The survey has also crystallized that the expansion of the cloud portfolio is enabling enterprises to move more critical workloads to the cloud.
“With the number of hosted private cloud solutions now available from providers that have strong IT service management processes, demand for these offerings is set to grow at rates faster than other cloud segments.
“It is also apparent from the survey that CIOs now recognize that a cloud solution is not just OPEX? significant up-front project costs are being reported. Typically, these are 10-20 percent of the total cloud project costs.”
The way in which services will be chosen has also evolved, with more influence being felt from lines of business managers.
Morris observed that LOB managers now contribute up to 50 percent of cloud spending, and are less interested in technology than they are in the delivered business service and what it can do for their business.
“For any SI or VAR that has previously relied upon technical expertise as a differentiator, this is a wake-up call.”
These changing buying behaviors are also changing the size of traditional markets. IDC sees continuing erosion of the IT outsourcing and managed services markets as increasingly viable cloud-based alternatives become available.
Hardware and software vendors are also adapting their go-to-market strategies; their largest customers are now the cloud service providers rather than the enterprise clients of five years ago ? and the cloud SPs are demanding new commercial models.
Successful adaptation to this new environment will be testing for all vendors with hardware and software business.
The IDC survey was run across 13 countries in Asia Pacific during March and April 2013. The sample size was 1,761.