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  • 29 August 2013 16:10

Cloud maturing into a $1b industry says IDC

According to market research firm IDC the market for cloud services in Australia - infrastructure, platform and software as a service - was worth almost $900m in 2012 and is set to reach $2.7b by 2017 - a compound annual growth rate of almost 25 percent - and the shift to cloud will have a profound impact on enterprise IT.

Driving this growth, IDC says is the fact that line of business managers are increasingly turning to cloud-based business services to meet their IT needs. Raj Mudaliar, senior analyst for cloud services research with IDC Australia, said: "Until 2012, cloud was primarily an IT label for IT infrastructure services delivered as a service. Now, cloud is no longer just an IT infrastructure play. Cloud-based business services being acquired by LOB managers will drive growth in the use of externally sourced services. “Cloud in 2013 is now business as usual for CIOs, IT managers, and LOB managers. By 2015, cloud will be just another delivery model for a range of ‘as-a-service’ offerings that are based on infrastructure as a service (IaaS), platform as a service (PaaS), and software as a service (SaaS)." Other trends identified by IDC in its report ‘Australia Cloud Services 2013-2017 Forecast and Analysis’ include a swing away from on-premises private cloud to virtual private cloud (VPC) as the number of these offerings increases, their price points came closer to those of public cloud and users increasingly choose SaaS for industry-specific applications and process functionality as they strive to improve business performance. “Virtual private cloud has been a safe choice for medium-risk applications, however the truly mission-critical applications like ERP will most often be deployed on dedicated private cloud - single tenant hosted from service provider's data centre,” IDC says. It adds: “In 2013, hosted private cloud intentions are on the rise, with standardised services as part of the package, reducing demand for pure private cloud deployments. It is expected that the services component will increase as larger and more complex projects get underway.” IDC sees the shift to cloud having a profound effect on enterprise IT. It predicts that over the next two years 80 percent of new enterprise apps will be developed for cloud and that by 2015, 20 percent of spending on enterprise applications will be via the cloud model. “The impact of this trend on cloud service buyers will be that they face a vast number of services and vendors, adding a management difficulty to easy adoption of new services,” IDC says. It predicts the emergence of cloud service brokers who will identify the best service for a customer based on a list of requirements specified by that customer. “In this future cloud scenario, effective management of service delivery chains which span multiple product and service provider ecosystems will determine the efficiency of an IT organisation,” IDC says. In relation to effective management, Bennett Oprysa, CEO of BitCloud could not agree more: “Growing and medium-size businesses in Australia are in a strong position to marry bespoke cloud services to proactive service delivery and management,” said Bennett. “IT Managers, CIOs and savvy business owners need to reap the benefits of the cloud through a hassle-free, managed model; the cloud simplifies and enables though seldom complicates.” “To be successful, the CIO of 2015 will need to put their team through an organisational metamorphosis, rebalance their skills portfolio from technology management to service management, learn to provide a business service and live with funding models in which capital expenditure is far outweighed by operating expenditure. Management of externally cloud IT and business services is the CIO challenge for 2015.”

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