Left behind: Who suffers in the cloud shift

New Gartner report shows what we’ve already seen: Money is moving to the cloud. But there will be winners, and there will be losers

Left behind: Who suffers in the cloud shift

Market research firm Gartner states that $111 billion worth of IT spending will shift to the cloud in 2016, and the number will almost double to $216 billion by 2020. That’s a big change.

If you didn't see this coming, you haven't been paying attention. Enterprises are moving quickly to the cloud, as they pick the right workloads and pack up as soon as they can (if they can).

The cloud is now systemic to IT in every way, including as a storage solution, a compute solution, and even security and management services. If enterprises and cloud providers are the winners is this market shift, who are the losers?

Traditional IT software and hardware providers will feel the pinch more than others. Most (such as Microsoft and IBM) already offer good cloud alternatives, while others (such as Oracle and HP) have yet to show strong options.

Even those with sound solutions find that selling the cloud means not selling their traditional higher-margin products. The shift to cloud basically removes their revenue, whether or not they report strong cloud sales. There may be good quarters and bad quarters for traditional vendors, but the overall trend will be negative.

What does this mean for the rank-and-file enterprise IT staffer? You may see desperate attempts from traditional hardware and software providers to move you toward on-premises solutions, perhaps disguised as a “private cloud.” Traditional providers are racing the clock to get inventory sold before public clouds take a deeper chunk of the market.

It’s unlikely that type of “private cloud” configuration will meet your overall needs, considering the value you can potentially obtain by leveraging public clouds. Of course, public clouds are not always a fit, so keep that in mind as well.

Even when public clouds are not a fit, you can look to managed service providers (MSPs) to host your existing workloads and get your company out of the datacenter business. This is what you should be thinking about right now. It will be a very different IT market in five years. You might as well prepare for it now.


Copyright © 2016 IDG Communications, Inc.