Cloud computing has brought about a step change in economics and sustainability of Information and Communication Technology enabled service provisioning. By exploiting innovations in cloud computing, public sector IT can be transformed into agile, cost-effective and environmentally sustainable ICT infrastructure.
The global cloud spending in 2018 was USD 187 billion growing at CAGR of 16.5%, and is being led by Communications, IT/ ITeS and Media industry verticals. All forms of cloud acceptance such as SaaS, IaaS and PaaS are growing. Per Nasscom report, the World IT spend as % of GDP is 3.0% and cloud adoption rate is 7.0%. Compare this to India, where IT spend as % of GDP is 1.6%, and cloud adoption rate is 6.0% leading to a good scope for growth. Cloud is critical to new age start-ups that are aiming to establish foothold in areas of emerging technology such as artificial intelligence, machine learning, advanced analytics, immersive media and so on.
“Flourishing start-up ecosystem, IT commoditization and need for cost optimization, and easy availability of talent pool is fueling cloud adoption.”
The advantages of having cloud infrastructure model are:
- On demand self-service
- Multi tenant business model
- Rapid elasticity
- Zero capex
- Measured pricing capabilities
Let’s have a look at the challenges in adoption of cloud ecosystem.
- Data security and privacy
- Perceived concerns around Loss of control & governance at an infrastructure level.
- Interoperability: Ability to have capability to integrate smoothly with existing deployments
- Possibility of vendor ecosystem lock in
- Regulatory compliances: National and international laws on data sovereignty and data privacy, industry specific regulatory compliance and jurisdiction are the top consideration.
Technology trends leading to Cloud adoption
- Edge Computing: People do not want to wait for bigger, newer and larger dataset. They require computing resources closer to the end consumer. Use cases are HD video on demand, gaming etc.
- Machine Learning: Higher computing capabilities allows to derive insights and acquire capabilities to forecast future actions. Use cases are self driving vehicles, Health diagnostics/ imaging etc.
- Real time analytics: Increased computing capabilities allows analysis of large quantities of data. Use case can be Real time Vehicle tracking, fraud detection at point of sale etc.
- Distributed system: To address the inefficiencies inherent with centralized system. Use cases are distributed ledger, crypto currency et al.
Key trends in Cloud adoption: Business Model
- Addressing seasonal demands: Some business are seasonal in nature such as filing returns, auction platform et al. Cloud’s flexibility in scaling up and down on demand can save cost significantly.
- All IT resources are available on demand such as Database on Service, Computing as a Service, Security as a Service leading to cost optimization
Key trends in Cloud adoption: Customer Experience
- With the rise of compute and storage options, it is possible to provide excellent media experiences such as Augmented Reality, Virtual Reaity. With the rise in MOOC option, education sector is likely to be disrupted significantly.
- Data driven automation particularly the based on data such as Home automation, manufacturing automation etc.
Government initiatives, rise in emerging technology and preference for Agile coupled with the need for IT cost optimization provide a good impetus for cloud adoption. Consultants and governments can be enablers and play a big role in assuaging concerns of industry to move to cloud.