Cloud computing investments to increase

Investments in cloud computing solutions and services are poised to increase in the next 12 months as opportunities for IT companies and their customers come into clearer focus, research from CompTIA reveals.

The study finds that 72 percent of end-user organizations surveyed plan to expand the number and types of cloud computing services they use over the next 12 months. Nearly two-thirds of end users (64 percent) plan to increase their investment in cloud solutions by more than 5 percent in the coming year.

From the customer perspective, the transition to cloud computing is accelerating because of a desire to reduce capital expenditures (cited by 85 percent of end user respondents) and to drive down costs (84 percent). Customers also expressed a desire to add new capabilities not available in current IT models as a reason to move to cloud computing. It was cited by 81 percent of end users surveyed, and offers up a compelling reason for channel providers to sell cloud services as a value-added solution, not simply a way to cut customer IT costs.

Medium-sized businesses with between $10 million and $99.9 million in annual revenues are the most aggressive users of cloud computing. The CompTIA study finds that nearly two-thirds (64 percent) of medium-sized businesses report involvement with cloud computing. That compares to 36 percent of small companies (less than $10 million in sales) and 58 percent of larger firms ($100 million and above in revenue).

Demand for cloud computing isn’t a given, however. The study identifies a number of challenges that end users cite during adoption, including difficulty integrating cloud solutions with existing IT systems and the painful transition away from legacy systems. Likewise, the channel has experienced obstacles along the way, mainly internally focused issues such as shouldering initial start-up costs associated with cloud computing and determining the right revenue model.

And yet, both constituencies are forging on.

Looking ahead, cloud-based business productivity applications and document and content management solutions are high atop end users’ shopping lists for the coming year. Forty percent of end users report plans to look to the cloud for business productivity applications and 38 percent identified document and content management services as a priority purchase. Other cloud services end users intend to buy in the next 12 months include security (35 percent), storage (35 percent) and general purpose services (35 percent).

More than half of end users surveyed say they will make their purchases from a third-party cloud services provider, defined as a value-added reseller, solution provider or other channel organization. Even more encouraging for IT channel companies, customers with the heaviest investment plans for the cloud over the next year overwhelming cite the channel as their source – 60 percent of them versus 40 percent that say they will seek out a vendor.

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