Currently, the adoption rate of cloud-based resources, services and infrastructure is more than 35 percent, a number that is expected to reach 50 percent over the next couple of years. While many organizations currently manage in-house systems, businesses are quickly migrating to cloud hosting deployments.
By the end of 2018, cloud implementation will encompass 70 percent of IT resources and infrastructure that's being outsourced or hosted. The need to develop modern business applications that operate through the cloud, a shortage of internal IT skills and potential cost savings are all driving forces behind an increased rate in cloud hosting.
While security remains a chief concern with cloud computing, the trust in such solutions has increased over time as businesses gain a better understanding of its benefits and capabilities. In fact, many companies have been able to improve security and performance through the cloud.
CIOs and CTOs continue to operate with shrunken budgets and have limited resources to maintain on-site infrastructure and provide the necessary manpower to respond to technical problems. For these reasons, IT decision makers are outsourcing IT to cloud-based hosting services to decrease costs while ramping up flexibility and quality.
Between 2010 and 2013, large and midsize corporations' use of cloud-based services increased by 40 percent. Approximately 90 percent of organizations now utilize some form of IT outsourcing through the cloud, compared to 63 percent in 2010. In addition, these businesses are also outsourcing human resources in order to compensate for their on-premises infrastructure, and in time, many large companies will gradually reduce their IT staff to a minimum.
Popularity of private platforms
The report also found widespread investment in on-premises, infrastructure-as-a-service clouds, especially as the use of hybrid solutions increases. In-house private cloud models were the second most popular IT infrastructure, and 32 percent of respondents noted security was better through their provider than internally.
"Those using cloud, co-location and managed services frequently projected 5-10 percent or 10-15 percent growth in revenue over the coming 12 months, versus the 1-5 percent projected by respondents relying primarily on in-house infrastructure," cited the study.
Cloud hosting and outsourcing trends are expected to continue seeing strong growth as more businesses come to rely on external help for increasingly complex computing demands.