IDC: Cloud Computing is Reshaping IT Marketplace

A new IDC (News - Alert) survey indicates that cloud computing is reshaping the marketplace and has the potential to create opportunities for IT suppliers and accelerate growth. IT companies will be spending $42 billion by 2012 on cloud computing, IDC predicted.

 

Spending on cloud computing is expected to accelerate throughout the forecast period, capturing 25 percent of IT spending growth in 2012 and nearly a third of growth the following year.

 

IDC is a provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets.

 

“A recent IDC survey of IT executives, CIOs, and their line of business (LOB) colleagues shows that cloud services are 'crossing the chasm' and entering a period of widespread adoption,” said Frank Gens, senior vice president and chief analyst at IDC, in a statement. “Moreover, IDC expects the cloud adoption trend to be amplified by the current financial crisis. The cloud model offers a much cheaper way for businesses to acquire and use IT – in an economic downturn, the appeal of that cost advantage will be greatly magnified. This advantage is especially important for small and medium businesses, a sector that will be key target in any plan for recovery.”

 

Cloud computing involves services delivered and consumed in real time over the Internet. This includes products, services and solutions for consumers and businesses. Cloud computing is an emerging IT development, deployment, and delivery model.

 

IDC pointed out that the IT “cloud” often is referenced in terms of online delivery and consumption models for business and consumer services. The “computing” in these cases lies behind recognizable services like banking, shopping or online storage.

 

The survey indicated that that the shift toward cloud computing is being driven by three market forces. First, there is the search for growth (and revenues) in important new segments, including emerging markets like Brazil, Russia, India and China (BRIC) as well as the small and medium business (SMB) sector. Second, there are the shortcomings of traditional approaches in capturing the growth in these increasingly important markets. Finally, there is competitive pressure from new players with little to lose and everything to gain from the new model.

 

IDC said that if IT suppliers are willing to cash in on the emerging cloud trend, they have to figure out means to deliver IT products or services to customers via the cloud model (for example, to consider whether to get into the software-as-a-service (SaaS (News - Alert)) business, the storage cloud business, or the server cloud business). Suppliers also need to sort out the traditional and cloud concerns before entering into cloud computing market.

 

According to survey respondents, the two most important things a cloud services provider can offer are competitive pricing and performance level assurances. These are followed by the ability to demonstrate an understanding of the customer's industry and the ability to move cloud services back on-premises if necessary.