4 predictions for the immediate future of cloud computing

Let these observations guide you through the next phase of cloud computing


Predictions tend to be more of an end-of-the-year activity, but I took some time to write down a few ideas and their likely outcomes based on patterns in the market that we can currently see. Here are a few to consider.

There will be more market convergence around Google, AWS, and Microsoft. This is as easy to call as the sunset. Enterprises moving to public clouds are largely going with these three companies. Moreover, the big three are placing their technology bets in cloud computing right now, and this will continue for the foreseeable future.

Many thought this would be race of a dozen or so public cloud providers, but the market has taken care of most of them. Indeed, smaller cloud providers, such as Rackspace, could not keep up with the investment and have moved to a narrower and more niche-oriented focus.

Anybody who is not AWS, Google, and Microsoft will have to grab a smaller piece of the market and hold on for dear life. Count on a few to move to the managed services space, such as Rackspace, while others will provide a specific area of public cloud services, such as “bare metal” clouds. Still others will focus on specific verticals such as health care or finance.

Enterprises will become more aware of total cost of ownership, and this knowledge will slow or stop cloud adoption within some enterprises. The value drivers presented earlier in this report are well understood and have a few years of proof in many enterprises. However, we also know cloud computing may not be cost effective or a good fit. That’s typically not seen until after the first few projects have been deployed, when the cost and benefit issues are better understood.

We’ll see the continued fall of the private cloud-only implementation. Public clouds will be paired with private clouds to form hybrid or multiclouds, which provide enterprises with more cost efficiency and scalability. The number of enterprises employing only private clouds will fall substantially in the next few years.

New public cloud providers will have to quickly find a niche. The market is dominated by existing players who can spend billions on both R&D and marketing. Startups are leveraging new and emerging cloud technology, such as containers, as a path for incremental growth. We’ll likely see the same pattern around data analytics services, data storage services, Internet of things (IoT), and other more recent technology trends.

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