IDC 2013 APeJ Cloud Predictions. Chris Morris AVP Cloud Services, APeJ
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1 IDC 2013 APeJ Cloud Predictions Chris Morris AVP Cloud Services, APeJ
2 2013: Business Overtakes Technology Fundamental IT And Business Changes Growing Importance Of Business: By 2016, 80% Of New IT Investments Will Directly Involve LOB Executives Cloud And Mobility: in 2013 CIOs And Business Managers Learn To Work Together Enterprise Talent Inventory Will Emerge As Major Differentiator For Innovation And Constraint To Technology Adoption Maturing Market Leads To Changing Adoption Patterns By 2016, A Growing Share Of It Infrastructure Spending Will Be Controlled By Cloud Service Providers. Active Trading And Arbitrage Of Cloud Services Will Emerge As A Business Model For Increasingly Commoditized IT-as-a-service Offerings. By 2015, Cloud Speed And Innovation Become Both Threat And Opportunity In 2013 Business Analytics In The Cloud Will Start Tenfold Growth As Horizontal PaaS Starts To Commoditize By 2015, Cloud Market Will Be Reshaped By Dual Forces Of Business And Technology Cloud M&A Will Accelerate By 50%, With $25 Billion In Worldwide SaaS Deals In The Next 20 Months By 2015, "The Cloud Marketing Label Has Negligible Value For Competitive Differentiation. The Rise Of "Industry Platform As A Service (PaaS)": IDCzxzVisit us at IDC.com and follow us on 2
3 Fundamental IT And Business Changes 1.Growing Importance Of Business: By 2016, 80% Of New IT Investments Will Directly Involve LOB Executives 2.Cloud And Mobility: in 2013 CIOs And Business Managers Learn To Work Together 3.Enterprise Talent Inventory Will Emerge As Major Differentiator For Innovation And Constraint To Technology Adoption 1. Growing Importance Of Business: By 2016, 80% Of New IT Investments Will Directly Involve LOB Executives With business managers driving demand: Match to business requirements still a primary selection criteria Time to market becomes a project defining imperative Externally sourced, standardized solutions based on best-practice service management processes becoming favored over on-premises, enterprise managed IT infrastructure IDC Visit us at IDC.com and follow us on 3
4 Cloud and Mobility Force Alignment 2.Cloud And Mobility: In 2013 CIOs And Business Managers Must Learn To Work Together With enterprise mobility, applications, UIs, OSes, APIs, middleware - every aspect of enterprise business software becomes subject to change There is no more omnipresent, useful, combined IT+Business hardware, software, and services factor. Massive challenges remain to be addressed, most notably development and support lifecycles, TCO, and security. Mobility s most critical factor driving revolution and evolution is that very little of the typical enterprise Mobility environment is within traditional Business or IT control. By forcing re-examination and re-configuration of business processes and IT together, Mobility is the force that mandates alignment of Business and IT leaders to an extent not seen before. IDCzxzVisit us at IDC.com and follow us on 4
5 Talent Shortage Impacts Growth 3.Enterprise Talent Inventory Will Emerge As Major Differentiator For Innovation And Constraint To Technology Adoption Business-driven demand for cloud services will stretch capabilities of IT professionals Tech roles increase in complexity to maintain SLAs Lack of combined tech/business talent will hamper cloud uptake IT team talent is often overlooked as the critical element of IT project success. An IT organization's level of embedded skill will affect project outcome regardless of technology complexity. Increasing team skill and employing successful practices reduce risk and contribute to successful implementations. IDCzxzVisit us at IDC.com and follow us on 5
6 Through 2013, Maturing Market Changes Behavior 4.By 2016, A Growing Share Of IT Infrastructure Spending Will Be Controlled By Cloud Service Providers. 5.Active Trading And Arbitrage Of Cloud Services Will Emerge As A Business Model For Increasingly Commoditized IT-as-aservice Offerings. 6.By 2015, Cloud Speed And Innovation Become Both Threat And Opportunity 7.In 2013 Business Analytics In The Cloud Will Start Tenfold Growth As Horizontal PaaS Starts To Commoditize 4.By 2016, A Growing Share Of IT Infrastructure Spending Will Be Controlled By Cloud Service Providers. Traditional ICT Supplier Model Hardware Services Software Enterprise Customer Current Locus of Power Cloud Computing Hardware & Software OEM Services Provider Consumer of Services Future Locus of Power Future Cloud Business Business Process Provider Services Provider Consumer of Business Services Further Expansion of Power With cloud SPs becoming major consumers of cloud infrastructure and also consumers of business process IP, their upstream partners must adjust to dealing with fewer but larger customers, which have very significant bargaining power. They will need to make significant change in their relationships with traditional business management software developers and providers, fundamentally changing their business nature and models IDC Visit us at IDC.com and follow us on 6
7 Datacenter Transformation Continues 5. By 2016, A Growing Share Of IT Infrastructure Spending Will Be Controlled By Cloud Service Providers. New technologies, designs Converged systems will account for over 1/3 of enterprise cloud deployments by 2016 Software-defined networks will penetrate 35% of Ethernet switching in the data center Bring Your Own ID (BYOID) will bring consumerization to enterprise security and applications IDC Visit us at IDC.com and follow us on 7
8 New Sales Models For Services 6.Active Trading And Arbitrage Of Cloud Services Will Emerge As A Business Model For Increasingly Commoditized IT-as-a-service offerings. By YE 2013, multiple types of Cloud IT services will be commoditized and re-sold on vendor-driven exchanges. Cloud providers business models will adapt and include such variables, or the providers will lose customers, revenues, and market position. Because of the commoditization pressures from such exchanges, IT providers will need to quickly find new ways to add value and differentiate their offerings and business models as well as define the secondary markets in which they will participate, and when and how.. IDCzxzVisit us at IDC.com and follow us on 8
9 Innovation Becomes A Threat 7.By 2015, Cloud Speed And Innovation Become Both Threat And Opportunity The pace of business innovation being driven by Cloud-based IT and business services is accelerating. This is a threat to IT organizations because of the unique and vast combinations of unknown, ungoverned, nonstandard and unaccountedfor adoption and utilization throughout and between enterprises. That threat includes the disintermediation of IT organizations and governance a threat to enterprises ability to do business securely and cost-effectively. Within that threat lies tremendous opportunity to rethink and repurpose IT roles, structures, and yes, power and influence. IDCzxzVisit us at IDC.com and follow us on 9
10 By 2015, Cloud Market Will Be Reshaped By Dual Forces Of Business And Technology 8. Cloud M&A Will Accelerate By 50%, With $25 Billion In Worldwide SaaS Deals In The Next 20 Months 9. By 2015, "The Cloud Marketing Label Has Negligible Value For Competitive Differentiation. 10. The Rise Of "Industry Platform As A Service (PaaS). 8. Cloud M&A Will Accelerate By 50%, With $25 Billion In Worldwide SaaS Deals In The Next 20 Months The SaaS spending spree will accelerate, to $25 billion in the next 20 months Targets will be those with key industry IP locked into their products and a supporting ecosystem of skilled partners SaaS vendors will grab software market leadership in key markets Impact will be felt as smaller vendors are acquired and product roadmaps realigned to the new parent s strategy IDC Visit us at IDC.com and follow us on 10
11 The Cloud Becomes Normal 9.By 2015, "The Cloud Marketing Label Has Negligible Value For Competitive Differentiation By 2015 cloud will be just a generic name for common 'as-a-service' delivery modes for supply of business and IT services. IT infrastructure devices will have inherent cloud capabilities, removing differentiation points. Most affected will be vendors of IT infrastructure, which must extend and adapt their go-to-market strategies. Public cloud as-a-service providers' market positioning must reflect the reality that the major buying centers are now in the lines of business (LOB), not the IT department. To retain relevance in the market as LOB spending on as-a-service offerings exceeds that of the IT department, both technology and as-aservice providers must rapidly adapt their ecosystems to include more value-add partners which have expertise in relevant business verticals and processes. IDC Visit us at IDC.com and follow us on 11
12 Cloud Platforms Verticalizing The Rise Of "Industry Platform As A Service (PaaS). An explosion in Industry PaaS offerings Less than 100 in 2012, will grow tenfold by 2016 Horizontal PaaS will become more commoditized Adoption of open source stacks, frameworks and tools is expanding Horizontal PaaS vendors need to move up the stack Horizontal PaaS vendors must increase their value (and "stickiness by following the value up into the industry PaaS world by creating their own industry-specialized PaaS capabilities and ecosystems, and by building partnerships with industry PaaS partners IDC Visit us at IDC.com and follow us on 12
13 Essential Guidance Cloud can t be planned, funded or executed without ties to mobility, social, big data & industry transformation IT Operations are transforming: hardware & software (easy), process & skills (hard), supplier terms & relationships (so-so) IT Industry leadership is ripe for turnover, again Enterprise IT leadership s role & agenda are being disrupted IDC Visit us at IDC.com and follow us on 13
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