Enterprise-class Cloud Strategy & Plans. Conducted on behalf of Dell and VMware Presented by: IDG Research Services

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1 Enterprise-class Cloud Strategy & Plans Conducted on behalf of Dell and VMware Presented by: IDG Research Services February CONTENT COMMUNITY CONVERSATION CONVERSION

2 Methodology Introduction This online survey was conducted on behalf of Dell and VMware among members of CIO s Forum on LinkedIn in order to learn more about cloud strategy and drivers for cloud computing investments, including the timeline for deployment of applications and infrastructure to an enterprise-class cloud. We also sought to determine the following: The percent of cloud-based applications and infrastructure that will be deployed via various cloud models looking ahead 12 months The critical issues that may be preventing or slowing the adoption of hybrid or public cloud solutions The criteria that is considered most important when evaluating these solutions Types of cloud support services that companies are interested in leveraging to help with cloud deployments over the next 12 months The role of virtualization as an enabler of cloud computing On January 25, 2012, members of CIO s LinkedIn Forum received an notification inviting them to participate in the survey. Quota sampling was employed to ensure respondents meet the following criteria: 50% employed at VP+ level Remaining 50% employed at Director level 1,000 or more employees at company The study closed on February 7, Results in this report are based on a total of 100 qualified responses. 2

3 Key Findings Interest in an enterprise-class public cloud model is high, with 25% already deploying via this cloud model and another 53% planning deployments. The majority (84%) have at least some infrastructure/ applications in any cloud model; 42% are pursuing a moderate to aggressive cloud strategy (more than 20% of infrastructure in the cloud). Increasing efficiency and reducing CAPEX are top cloud drivers. Looking ahead 12 months, more than one-third (34%) of cloud data is expected to be deployed via enterprise-class public cloud (either stand-alone or hybrid), double the percent of data expected to be deployed via a SaaS model (16%). Hosting business applications is the top goal with regard to the use of enterprise-class public cloud. Concerns regarding security is the most frequently mentioned inhibitor of hybrid or public cloud deployments. Therefore it is not surprising that the ability to meet security requirements is the top criteria in terms of importance when evaluating a public or hybrid cloud solutions provider. Integration and support & services are also high on the list of important criteria. More than one-quarter are already using consulting or application services to help jumpstart their journey to the cloud, and another 46% are likely to do so. Application support, backups and monitoring are the top cloud support services of interest over the next 12 months. 3 The majority consider virtualization to be an enabler or driver of public cloud computing; Respondents report that 55% of the infrastructure is virtualized on average.

4 4 SURVEY RESULTS

5 Increasing efficiency and reducing CAPEX are top cloud drivers. Importance of Cloud Computing Drivers (% Rating Critical/Very Important) Increasing efficiency via automation/reduction in manual processes 72% Reducing capital expenditurues 72% Improving agility to react to market changes 67% Increasing application availability 66% Implementing more comprehensive security and compliance controls 57% Reducing waste/lowering energy consumption 36% Q1: How important are the following as drivers of cloud computing initiatives at your organization? Base: 100 5

6 The majority (84%) have at least some infrastructure/ applications in the cloud; 42% are pursuing a moderate to aggressive cloud strategy. Overall Cloud Strategy Aggressive (More than 50% of infrastructure/ applications in the cloud) 9% Moderate (20% - 50% of infrastructure/applications running in the cloud) 33% Conservative (Less than 20% of infrastructure/ applications running in the cloud) 42% Passive/wait and see (Late adopters) 10% Research only 2% No interest in cloud 3% Other 1% Q2: How would you characterize your organization s overall cloud strategy? Base: 100 6

7 The majority consider virtualization to be an important enabler or driver of public cloud computing; On average, 55% of the infrastructure is virtualized. Somewhat important 14% Importance of Virtualization as an Enabler or Driver of Public Cloud Computing Deployments Not very important 12% Not at all important 5% Critical 25% Very important 44% 7 Q11: Approximately, what percentage of your organization s infrastructure is virtualized? Base: 100 Q12: How important is virtualization as an enabler or driver of public cloud computing deployments at your organization? Base: 100

8 Interest in an enterprise-class public cloud model is high, with 25% already deploying via this cloud model and another 53% planning deployments. Timeline for Deploying Applications and/or Infrastructure to an Enterprise-class Public Cloud (excluding SaaS) Already deploying applications/infrastructure to an enterprise-class public cloud 25% Deployments planned within 3-6 months 16% Deployments planned within 6-12 months 18% Deployments planned more than 12 months from now 19% No interest 22% Q4: What is your organization s timeline for deploying applications and/or infrastructure to an enterprise-class public cloud (excluding SaaS)? Base: 100 8

9 Hosting business applications is the top goal with regard to the use of enterprise-class public cloud. Objectives with Regard to Use of an Enterprise-class Public Cloud (Among those with current or planned deployments) Hosting of business applications 72% Managing IT operations Disaster recovery Increasing flexibility to respond to spikes in demand New product/service launches Development and testing Other 4% Not applicable 1% 54% 50% 50% 40% 40% Those companies that have more than 20% of their applications/infrastructure in the cloud are significantly more likely than others to cite managing IT operations as an objective with regard to enterprise-class cloud. Q5: Which of the following are objectives with regard to your organization s use of enterprise-class public cloud computing over the next 12 months? (Please select all that apply.) Base: 78 respondents deploying or planning to deploy applications and/or infrastructure to an enterprise-class public cloud 9

10 Looking ahead 12 months, more than one-third of cloud data is expected to be deployed via enterprise-class public cloud (either stand-alone or hybrid). Percent of Cloud-based Applications and Infrastructure Planned for Deployment via Each Cloud Model 12 Months from Now Private cloud 50% Enterprise-class public cloud as a standalone service 13% Enterprise-class public cloud combined wth private cloud for "hybrid" operating model 21% Commodity or opensource cloud services (including SaaS) 16% Q6: Twelve months from now, approximately what percent of your organization s cloud-based applications and infrastructure will be deployed using the following cloud models? Base:

11 Concerns regarding security are frequently preventing or slowing adoption of hybrid or public cloud. The Top Issue Preventing or Slowing Adoption of Hybrid or Public Cloud Security concerns 26% Regulatory compliance Perceived lack of control over data Application support or application compatibility 12% 12% 11% Skill/training gaps Resistance from business management Reliability/uptime concerns 4% 6% 5% Lack of knowledge about what to migrate 1% All of the above Other 9% 11% None of the above 3% Q7: What is the ONE critical issue preventing or slowing adoption of a hybrid or public cloud solution at your organization? Base:

12 Not surprisingly, the ability to meet security requirements is the top criteria in terms of importance when evaluating a public or hybrid cloud solutions provider. Importance of Characteristics when Evaluating a Public or Hybrid Cloud Solutions Provider (% Rating Extremely/Very Important) Ability to meet security requirements Integration into existing infrastructure Support and services Appropriate level of scalability Ease of use Easy-to-understand pricing model Experience in building & operating cloud Innovative solutions 92% 87% 85% 81% 80% 73% 68% 59% Q8: How important are the following characteristics when evaluating a public or hybrid cloud solutions provider? Base:

13 More than one-quarter are already using consulting or application services to help jumpstart their journey to the cloud, and another 46% are likely to do so. Likelihood of Using Consulting or Application Services to Jumpstart Cloud Journey Not at all likely, 4% Not very likely, 21% Already using, 29% Somewhat likely, 20% Extremely likely, 16% Very likely, 10% Q3: How likely is it that your organization will consider using consulting or application services to help jumpstart its journey to the cloud within the next 12 months? Base:

14 Application support, backups and monitoring are the top cloud support services of interest over the next 12 months. Types of Cloud Support Services Interested in Leveraging Next 12 Months Application support 47% Backups Monitoring 40% 37% OS Support Patching updates 25% 25% Other All of the above None of the above 6% 10% 13% Q9: Which of the following types of cloud support services is your organization interested in leveraging over the next 12 months? (Please select all that apply.) Base:

15 On average, 16% of organizations cloud computing budgets originate from the business (versus IT) Percent of Cloud Computing Budget Originating from the Business (versus IT) 31% Those companies that have more than 20% of their applications/ infrastructure in the cloud indicate that a larger proportion of their organizations cloud budgets originate from the business (21% versus 11% among all other respondents). 15% 14% 19% 10% 11% None 1%-10% 11%-20% 21%-30% More than 31% Not applicable Q10: What percent of your organization s cloud computing budget (sign-off) originates from the business (versus IT)? Base:

16 Business partners and vendors are key sources respondents turn to for information about public/hybrid cloud services. Primary Source of Information or Guidance Regarding Public/Hybrid Cloud Services Business partners/vendors 26% IT management team Technology news magazines or web sites Research briefs/whitepapers Online forums or peer communities Consultants 16% 16% 12% 11% 11% In-person discussions with peers 6% Other 2% Q13: As a senior-level executive, what is your primary source for obtaining information or guidance about public or hybrid cloud services? Base:

17 17 DEMOGRAPHIC PROFILE

18 Number of Employees 100,000 or more 15% 50,000-99,999 30,000-49,999 6% 8% Average no. of employees: 28,592 20,000-29,999 7% 10,000-19,999 11% 7,500-9,999 6% 5,000-7,499 1% 2,500-4,999 20% 1,000-2,499 26% Q14: Approximately how many people are employed in your entire company or enterprise? (Please include all plants, divisions, branches, parents and subsidiaries worldwide.) Base:

19 Job Title IT MANAGEMENT (NET) 93% CIO, CTO Director 28% 41% VP Manager, Supervisor Executive VP, Senior VP, General Manager BUSINESS MANAGEMENT (NET) Executive VP, Senior VP, General Manager 9% 9% 6% 7% 4% CEO, Chairman, President 1% VP 1% Director 1% Q15: Which of the following best describes your title within your organization? Base:

20 Industry/Function Public sector/nonprofit (including government Banking & Financial Services Manufacturing/Auto/Industrial Healthcare Business/Professional Services Transportation & Logistics Wholesale/Retail trade Technology Communications Consumer Goods, Food & Beverage Information, Media & Entertainment Insurance Aerospace/Defense Hardware/Software/Networking Travel & Hospitality Chemicals/Energy/Utilities Life Sciences, Pharmaceuticals, Biotechnology Other 13% 9% 7% 6% 6% 6% 5% 4% 3% 3% 3% 2% 2% 2% 1% 1% 11% 16% Q16: Which of the following best describes your organization s industry or function? Base:

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