7 Key Cloud Computing Trends That Will Shape Enterprise Computing In 2020
Grow Your Business, Not Your Inbox
You're reading Entrepreneur India, an international franchise of Entrepreneur Media.
From being seen as a leverage for cost, cloud computing has become one of the most defining trends in the past five years. Today, cloud computing is being used as a key agent for business transformation, and the clear deployment model of choice for modernizing existing information technology infrastructure. Investments in cloud computing have steadily grown. For example, IDC predicted that cloud spending in India on public cloud services and infrastructure will reach $2.9 billion in 2019, an increase of 34.5 per cent over 2018, according to IDC Worldwide Semiannual Public Cloud Services Spending Guide. Although annual spending growth is expected to be moderate during the forecast period 2017-22, IDC predicts that the market is expected to hit a five-year compounded annual growth rate (CAGR) of 33.9 per cent in public cloud services spending.
This year too, expect cloud computing to dominate the market, as it will continue to be the platform for emerging technologies such as artificial intelligence (AI), blockchain and Internet-of-Things (IoT). In 2020, we see the following seven big cloud computing trends that will shape up enterprise computing:
The Continued Rise of Hybrid Cloud
In a multi-cloud world, hybrid cloud will continue to be the deployment model of choice as more flexibility is offered to enterprises by multiple cloud providers. Research firm Gartner, for instance, predicts that by 2020, 75 per cent of organizations will have deployed a multi-cloud or hybrid cloud model. Another report by research firm, MarketsandMarkets, found that the demand for hybrid cloud is expected to be driven by several factors, such as cost efficiency, scalability, agility and security. The firm predicts that the hybrid cloud market will grow from $44.6 billion in 2018 to $97.6 billion by 2023, at a CAGR of 17 per cent. The firm believes that hybrid cloud provides economies of scale while simultaneously delivering security to the sensitive information of businesses.
Edge Computing Moves to Center Stage
A survey by Cisco predicts that the number of devices connected to IP networks will be more than three times the global population by 2022. Similarly, a Gartner study forecasts that 14.2 billion connected things will be in use in 2019, and that this total will reach 25 billion by 2021, producing immense volume of data. A McKinsey study claims that 127 new IoT devices connect to the Internet every second. This clearly has a big impact on the way data centers are built, as companies will require smaller data centers at the edge and place it closer to the location where data is being generated. This has given to the rise of edge computing. Gartner states that by 2025, 75 per cent of enterprise-generated data will be created and stored at the edge. Similarly, an IDC FutureScape report states that by 2022, 40 per cent of enterprises will have doubled their information technology asset spending in edge locations and nearby co-location facilities versus core data centers to deliver digital services to local users and things.
Hyper-scale Data Centers Set to Scale Up
In the digital age, businesses operate at a hectic speed. This is an era of instant consumption, and enterprises cannot wait for their information technology systems to deliver the services at a pace that traditional systems offer. Organizations need an IT infrastructure that can scale at an extremely quick pace to provision increased demand and then scale down appropriately when demand reduces. This has led to the demand for hyper-scale data centers. Hyper-scale refers to the capability of an IT system or architecture to scale exponentially and rapidly to respond to demand that is increasingly heavily. A report by Markets&Markets estimates the hyper-scale data center market to grow from $25.08 billion in 2017 to $80.65 billion by 2022, at a CAGR of 26.32 per cent. Cisco estimates that by 2021, traffic within hyper-scale data centers will quadruple, and hyper-scale data centers will account for 55 per cent of all data center traffic by 2021. Due to the modularity of hyper-scale data centers, data center operators can replace individual physical components, which gives organizations extreme flexibility in scaling at the physical level, as components can be added modularly.
Demand for Disaster-Recovery-as-a-Service Peaks
As more organizations take the digital route, the cost of downtime is increasing rapidly. A report by IBM states that the average cost of a data breach is close to $3.92 million. According to Gartner, the average cost of IT downtime is close to $5,600 per minute. Of course, this depends on the business that the organization is in. For example, if it is an e-commerce firm, the cost can be disastrous as downtime means missed opportunities for sales. At the same time, regulations such as GDPR have mandated that organizations need to handle the data of citizens with extreme care. Organizations need to be legally compliant and also confident that their disaster recovery strategies are in place. This has encouraged organizations to increasingly look at DR-as-a Service, as an automated DR strategy can significantly reduce the recovery time. IDC estimates that the DRaaS market will reach $4.5 billion in 2020 with a 15.4 per cent through 2023.
Hyperconverged Infrastructure Set to See Increased Interest
Hyperconvergence—an IT framework that integrates storage systems, servers, and networking into one single platform—has emerged to be a popular choice due to its promise of centralized and simple monitoring, while increasing scalability. Gartner predicts that by 2020, 20 per cent of business-critical applications currently deployed on three-tier IT infrastructure will transition to a hyperconverged infrastructure (HCI). Research firm Mordor Intelligence predicts that the hyperconverged infrastructure market is expected to register a healthy CAGR of over 13 per cent from 2019-2024. The firm says that HCI solutions are increasingly emerging as the ideal alternative to public cloud platforms as these systems are simple to manage and help reduce the costs associated with traditional data center systems.
Increased Use of AI in the Data Center
2020 will see increased use of AI in the data center. From saving energy to detecting patterns in server or network hardware failures, AI can be used to proactively to solve problems before they occur. AI-based platforms can also help data centers in learning from past data and distribute workloads across peak periods more efficiently. AI can also help organizations in solving skill shortage issues. Gartner, for instance, predicts that by 2020, 75 per cent of organizations will experience visible business disruptions due to infrastructure and operations skill gaps (an increase from less than 20 per cent in 2016). AI can play a big role in automating many of the tasks that human agents do today. The impact of AI is such that Gartner predicts that more than 30 per cent of data centers that fail to sufficiently prepare for AI will no longer be operationally or economically viable by 2020. AI-based services and solutions will be delivered using the cloud.
The Rise of Containers
The build it once, run it anywhere mantra of containers has found huge interest among organizations. By 2023, Gartner predicts that more than 70 per cent of global organizations will be running more than two containerized applications in production, up from less than 20 per cent in 2019. Similarly, IDC predicts that 95 per cent of new micro-services will be deployed in containers by 2021. As containers simplify deployment, management and operational concerns associated with a hybrid cloud, they are expected to see a huge rise in deployment, in line with the growth observed with respect to the hybrid cloud.