Cloud technologies are some of the biggest accelerators of innovation today. The demand for increased speed and service delivery is driving the adoption and development of cloud platforms across industries.
Gartner forecasts that the global public cloud service market will reach US$331.2 billion (S$455.83) in 2022, enjoying a 12.6% compounded annual growth rate. In Southeast Asia alone, it is estimated to reach US$40.32 billion (S$55.59 billion) by 2025 with a growing adoption among small and medium enterprises.
Cloud computing is a service that businesses rent from providers which includes data storage, management, and IT infrastructures. Nowadays, more and more companies are integrating, adopting, and migrating to the cloud to solve gaps and problems in their business, and be more dynamic and agile in delivering services.
Drivers of adoption
Every industry right now is going through a digital transformation thanks to cloud computing and other disruptive technologies. As industries are caught between disruption and the rise of tech startups, companies are now increasing their tech capabilities in order to survive.
Flexera’s RightScale 2019 State of the Cloud Report highlights that around 94% of enterprises are using cloud technologies and two-thirds of them have an in-house central cloud team. Cost cutting remains the top driver for adopting cloud technology as they provide fast and reliable services without the overhead costs of maintaining an in-house IT infrastructure.
But perhaps the most important aspect that drives businesses to migrate to the cloud is agility. Cloud services enable businesses to adapt much quicker to changes. Agility helps businesses enter new markets, improve productivity, and increases their responsiveness to customer demand.
Types and applications of cloud computing
Cloud technologies can be divided into three types—Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a Service (SaaS).
IaaS refers to servicing the fundamental needs of companies such as data storage, networking, and servers. Cloud giants like AWS, Microsoft Azure, Google Cloud Platform and IBM are in a constant flux in leading this space, increasingly repackaging PaaS and SaaS to gain IaaS dominance.
PaaS runs on top of the IaaS. This layer includes the tools that developers need to build applications on the cloud. Recently, Singaporean cloud company Wavecell was acquired by US cloud provider 8x8, signalling how U.S. data firms are expanding their operations into Asia. Wavecell offers SMS, chat apps, video interaction and voice solutions to businesses to enhance their CRM and on-cloud enterprise platforms.
Perhaps the most familiar is SaaS, as it delivers software services that are run on the cloud. This takes up the bulk of cloud investments, as enterprise software comprises 60% of the overall cloud revenue. CRM provider Salesforce, Microsoft, and Oracle dominate this particular market. Innovations including VR for manufacturing and AI-driven software are expected to be delivered in SaaS as it’s designed for frequent rollouts and constant service deliveries.
The future of cloud
The rise of cloud native startups, cloud architecture, and edge computing are what’s fuelling further innovation in cloud technologies according to industry leaders. However, challenges in the cloud skills gap and apprehensions in cybersecurity remain the largest hurdles for industry wide adoption.
One key challenge in cloud adoption is the skills gap. According to the IDC Worldwide CIO Agenda 2019 Predictions, around 30% of in-demand roles in emerging technologies will be left vacant until 2022. Additionally, over 14,000 cloud-related jobs on average are listed on job portal Dice.com on any given day. This gap could soon be filled though as more people are seeking ways to learn and understand about this particular technology. Udemy has over 498,000 students learning about cloud computing through a range of courses aimed at different abilities. This gap needs to be filled faster though, as the lack of expertise will eventually slow down the adoption and innovation when it comes down to cloud technologies.
Hybrid cloud configurations are the current popular trend. While most enterprises have adapted to private cloud services, the developing services being offered by public cloud providers and the pressure to innovate are pushing companies to adapt. Hybrid cloud strategies involve leveraging the agility of public cloud platforms while retaining full control over their data and applications. Currently, innovators and cloud providers are starting to find ways to dominate this space with hybrid-native approaches. Cloud architectural innovations including containerisation, microservices, and serverless computing are some of the cutting edge applications leading the way to stabilise and catalyse adoption.
Cloud platform providers are also looking at edge computing to lead the way in the fourth industrial revolution. Innovations such as the Internet of Things and 5G are pushing the demand for connectivity to be more ubiquitous. Coupled with the increasing computing power possessed by modern devices, and there’s a renewed incentive to store and compute data on-premises. Edge computing allows companies to leverage and integrate both on-premise and cloud computing in a seamless and productive fashion.
Many see this stage of adoption, mainly by large enterprises, as the growing pains of an industry that’s set to become the norm in the near future. As cloud technologies mature more and more companies and personal users will use the technology as an integral part of their daily data storage.
