Gartner predicts that by 2016, public cloud spending in Australia will reach US$5.2 billion. The analyst firm is forecasting that Australian spending on public cloud will reach US$3.2 billion this year, representing a growth rate in excess of 23 per cent. It puts Australia ahead of the global average of 18.5 per cent growth for 2013.
In Australia, public cloud has already found some outspoken proponents among large enterprises, including Commonwealth Bank CIO Michael Harte. Harte told a cloud computing event late last year that the bank had already saved "tens of millions of dollars" after implementing "small initiatives" that leveraged Amazon Web Services' cloud.
The launch of AWS' Sydney Region – offering cloud services across multiple on-shore data centres – has helped remove one of the biggest grips about public cloud in Australia, the issue of data sovereignty (one of the reasons for not shifting to cloud that Harte condemned as "absolute garbage".
And while Amazon may be the cloud leader, it's far from the only provider in Australia. Rackspace, one of the key forces behind the open source OpenStack cloud software, has also opened shop in Australia and will offer cloud services, and Telstra, Optus and other providers also deliver as-a-service offerings in the country.
As more barriers erode and increasing numbers of Australian organisations dip their toe in the cloud, it holds serious implications for IT departments.
Without wanting to put a time frame on it, Adam Selipsky sees the beginning of the end of companies managing their own infrastructure. As you would expect, the AWS vice-president is gung ho about the prospects of cloud. But even as more infrastructure is delivered as a service, he still thinks, the IT department has a bright future.
"I think it becomes more and more likely not less and less likely [that] as you see the adoption of the cloud that in the future, companies will have much smaller data centre presences, in many cases no data centre presence," Selipsky says. "And those that do have will [have them] typically be for special purposes."
Selipsky hammers home the list of benefits of using cloud AWS that has been pushing almost since Amazon's cloud offerings began: the shift from capex to opex, the ability to match capacity to demand, and the agility and benefits of focussing a business on delivering better outcomes to its customers instead of managing its infrastructure.
"If you look at all those benefits, and then you map that to the actual progress that we're seeing our customers make, I think it becomes more and more likely that that trend continues and accelerates and you hit that stage where data centres for companies are exceptions and not the rule," Selipsky says.
"I think that's been very well proven in the startup space – how many startups are running their own data centres today? It's incredibly rare."
But while cloud may not bode well for in-house data centres, Selipsky says that IT departments "are absolutely not going anywhere".
"I think that what we're seeing and what's going to continue to happen is they're able to, number one, evolve in some cases work on some slightly different things. And number two, are able to provide a lot more value to their internal customers than they've been able to provide traditionally."
"Private data centres may not be relegated to computing museums just yet," Rodney Gedda, a senior analyst at Telsyte, says. Gedda believes that maintaining in-house data centres will continue to remain strategic for many organisations.
And where cloud gets a foothold, IT managers will still have to manage the virtual infrastructure. Cloud "presents a valuable option in the catalogue of IT service delivery, but IT managers still need to be on top of their infrastructure landscape to make the best use of everything available," Gedda says.
Cloud "doesn't get rid of the sysadmins", says Paul Keen, the technology and development manager at Sydney-based online gift voucher retailer RedBalloon, an AWS customer. But it does change what they do, he says.
"Instead of changing hardware and looking after those sort of things, it allows our sysadmins to actually add value. They're building their environments, they're working with developers much more closely, so they can potentially do programming work or make sure they're ... being proactive with logs to see if there are any problems. There's much more value-add rather than just dealing with keeping the lights on."
And the sysadmins "love it" he adds. "They're much more technical-focused now. Our sysadmins do a fair bit of programming instead of just dealing with hardware."
A familiar refrain of cloud evangelists is that it can end the perception as IT departments as the gatekeepers – "the people that say no," Selipsky says.
"We've seen time and time again that developers, system administrators, architects, find that using the cloud is really a freeing or a liberating experience, where they all of a sudden they get to say 'yes'."
"They get to say yeah, we can provision new resources for you very quickly, very easily, very low cost and [IT departments] can just take on a far greater throughput of projects inside the enterprise," he says.
"I think with that greater throughput of projects, there's going to be no lack of work for IT departments. I think instead of focussing on things like signing data centre contracts and managing bandwidth and actually provisioning servers, they're going to be concerned with managing those environments in a highly scalable, highly automated fashion.
"And then, importantly, managing the applications that sit on top of that infrastructure. And at the end of the day that sort of tasks will provide more value to the enterprises than kind of the more traditional sort of tasks [of IT]."