As cloud migrations accelerate, Spiceworks Ziff Davis examines current and future adoption rates of key cloud-based technologies.

Introduction

Even before the pandemic, cloud computing fundamentally changed the way many organizations approach IT. The convenience and flexibility of the public cloud model allowed businesses to rapidly deploy services and applications — scaling them up and down as needed without the need to maintain as much physical infrastructure, if at all. 

In 2020, the COVID-19 health crisis further accelerated the shift to cloud. To rapidly enable remote workers at scale, many businesses turned to cloud-based solutions. At the height of the pandemic, approximately 60% of the global workforce was operating in a work-from-home environment. 

To remain agile and adapt to volatility, organizations leveraged cloud providers’ global data centers, to serve employees and customers around the world. Cloud services were also a boon for remote and field workers, helping to eliminate the bottleneck of remotely accessing on-premises servers. 

Our research indicates that 30% of the workforce will go remote permanently in the “new normal” following COVID-19 — nearly doubling pre-pandemic work-from-home numbers. Our data continues to indicate, as a result, an increasingly upward trend in cloud adoption.

1. The Survey Says: All Signs Point to Cloud Growth

In March 2021, SWZD conducted a survey of 500+ cloud decision makers to gain insights into the future of cloud adoption and purchase behaviors. One of our primary findings included that 40% of workloads are currently running in public clouds, with adoption growth only expected to continue after the pandemic ends.

We also found that 53% of all organizations accelerated cloud migration due to the business impact from COVID-19. Digging deeper into the data, it’s clear that remote work was a driving factor behind this shift. Among businesses with a flexible work policy, 64% accelerated cloud migrations during the pandemic compared to only 30% of businesses without flexible work arrangements.

2021 remote work and cloud adoption, by the numbers:

• 80% of decision makers agree cloud is useful for supporting remote workers
• 66% of companies have a flexible work policy 

With cloud adoption steadily rising, we’re at a point where cloud-based solutions are a given in many organizations. 

Again speaking to the relationship between remote work and cloud adoption, companies with flexible work policies are more than twice as likely to be “cloud-first” (54%) than companies that don’t have flexible work policies (24%).

Additionally, respondents from “cloud-first” organizations overwhelmingly (88%) believe their organization’s cloud strategy is on the right path.

2. Cost as a Top Factor Influencing Cloud Growth

In any purchase decision, money plays a big role in whether a prospect chooses to buy, or not. In our cloud buying collective report, we shared that total cost of ownership (considering initial price and cost of managing, securing, and maintaining a solution) is one of the top factors that IT buyers consider when researching a cloud solution. 

In 2021, our data indicates we may be at an inflection point where it makes sense for price-conscious organizations to choose cloud-based solutions more often than not.

A deciding factor in which cloud starts to make more sense from a cost perspective seems to be whether or not an organization supports remote workers. Among businesses with flexible work policies, 63% of IT buyers believe it’s cheaper to use public cloud than to self-host applications and services, compared to 34% of IT buyers in businesses that don’t support flexible work.

For many organizations, cloud payment terms are also attractive. Overall, 50% of organizations would prefer to pay for tech infrastructure as a smaller recurring operating expense (OpEX) vs. a less frequent, much larger capital expense (CapEX).

Following the trend, it’s also notable that decision makers in companies with flexible work policies also have stronger preference for OpEX over CapEX (59%) than organizations without flex work policies (34%).

2.2 Cloud Security Also an Important Consideration

In an age where hackers can bring a company, supply chain, or an entire city to its knees, security is top-of-mind among IT professionals and business decision makers. According to our recent cloud study, security is the fourth most important factor when evaluating cloud-based solutions. Additionally, in our 2021 State of IT report we revealed that endpoint security was the number one remote work concern during the pandemic.

Most IT buyers (54%) now agree that cloud providers can offer superior security compared to an organization’s own data center, which helps explain the growing popularity of cloud services.

Additionally, trust of cloud providers is particularly strong among organizations embracing remote work. We found 61% of IT buyers in companies with flexible work policies believe cloud providers’ security is superior to their own, compared to only 39% of IT buyers in companies that don’t have flexible work arrangements.

3.1 Cloud Adoption: Now and in the Future

The many factors driving businesses towards the cloud model manifest themselves in the growing popularity of cloud-based solutions and services. Among almost all cloud technologies covered in our survey, adoption is expected to increase by more than 10 percentage points by 2023.

Current business adoption rates of cloud file sharing (54%), Software-as-a-Service (46%), cloud backup and recovery (40%), cloud storage infrastructure (37%), and Public cloud infrastructure (37%) make them the most widely used cloud technologies. Within the next two years, we expect all of these technologies to be used by the majority of businesses, if they aren’t already.

Cloud technologies where some physical infrastructure resides in an organization’s own datacenter are also prevalent. The current adoption of rates of private cloud (28%), hybrid cloud (26%), consumption-based infrastructure (17%), and hyperconverged infrastructure (16%) speak to the need among some organizations for the convenience of the cloud delivery model but the low latency, control, and regulatory compliance of keeping some hardware and data local.

Worth noting, organizations are making moves that will allow for more agility. Adoption of the hybrid cloud model — which allows for data and workloads to move seamlessly between an on-premises private cloud and a public cloud — currently stands at 26% and is expected to grow to 40% within the next two years. At its best, hybrid cloud allows organizations to leverage the best of both worlds: the scalability and flexibility offered by public cloud providers and the privacy and low-latency of on-premises infrastructure.

Additionally, multi-cloud — the ability to seamlessly utilize more than one public cloud vendor for a given task, gives organizations an even more options to go with the cloud vendor best suited for a given task. Adoption of multi-cloud is expected to grow from 18% today to 31% within two years. 

Of interest, adoption of the newer consumption-based model where organizations lease an on-premises private cloud using a pay-as-you-go model (e.g., HPE GreenLake and Dell EMC Flex on Demand) appears poised to edge out more established solutions such as hyperconverged infrastructure by 2023.