Cutting through the fog: What is private cloud and what role does it play in the broader IT market?

TBR

TECHNOLOGY BUSINESS RESEARCH, INC.

Cutting through the fog: What is private cloud, and what role does it play in the broader IT market?

July 31, 2014

TBR’s Private Cloud Webinar

TBR

TBR Quarterly Webinar Series | 7.31.14 | www.tbri.com | ©2014 Technology Business Research Inc.

Private Cloud Webinar: Presenter

Allan KransCloud Practice Manager

Email: [email protected] Twitter: @allankrans

Insert Analyst Photo

2

mailto:[email protected]

TBR


Key Takeaways: Point 1

Private clouds, combined with increasing management and integration capabilities, will enable the next step in cloud solution delivery

3

Customization is the driving force behind the growth in private cloud opportunity.

Multiple routes will exist for customers to create and consume more cloud-delivered integrated solutions.

Insert Picture

Insert Picture

Skills are a barrier vendors will need to help customers overcome.

TBR


• Skills to manage delivery and security• Growing public cloud

accessibility

Growth in private cloud will moderate as the broader market develops skills to build or consume IT through this new delivery methodGlobal Private Cloud Market

Drivers

2014:$41 billion

2018: $69 billion

Barriers

• Line of business (LOB) purchasing involvement• Tight data center capacity• Emerging standards

50%CAGR

14%CAGR

2010: $8 billion

Cloud Customization

~NEW~

~NEW~

~NEW~

~NEW~

4

TBR


Private cloud adoption returns more of the control and consideration to the IT department

Public Cloud Adoption • Shadow IT purchasing• Fragmented management

Private Cloud Adoption• IT-driven purchasing• Traditional management

Early Hybrid Adoption• IT and LOB purchasing• Modern management

Technology-focused Adoption

Outcome-based Adoption

Pendulum of Cloud Adoption

IT is at least involved, if not

controlling, nearly 70% of private

cloud purchasing.

Security, usage monitoring and integration are

top private cloud concerns.

Cloud Customization

5

TBR


Integration and

Aggregation Layer

Delivering cloud services as solutions is a largely services-based opportunity that exists above and across cloud servicesCloud Solutions Delivery Options

Public Cloud CRM

Self-built Private ERP

Traditional On-premises Accounting

Outcome

Delivered via: Systems Integration

Managed ServicesCloud Orchestration Services

Business Process as a Service (BPaaS)Cloud Brokerage

~NEW~

~NEW~

~NEW~

Cloud Customization

6

TBR




7

Insert Picture

Insert Picture




TBR


With IT more involved, private cloud is highlighting the gaps between cloud services and traditional IT organizationsGaps in Private Cloud Capabilities

NIST Cloud Essential Characteristics:

1. On-demand self-service2. Broad network access3. Resource pooling4. Rapid elasticity5. Measured service

Corporate IT Typical Characteristics:

1. IT-serviced2. Dedicated networks3. Resource dedication4. Incremental elasticity5. Aggregate service

Private cloud is highlighting the gaps

Top barriers:

How can I scale efficiently?

How can the usage be metered and reported back to constituents?

How can these services be integrated and

secured?

Private Cloud Skills

8

TBR


Gaps in the skills and requirements for application migration significantly impact the workloads that can be transitioned to private clouds2014 Expectations Versus Reality

Private cloud apps

Private infrastructure

Private cloud apps

Private infrastructure

Growth Expectations for 2014 2014 Growth Reality

Workloads migrated to private cloud

2014 has been a near total reversal of expectations for which workloads would be migrated to private cloud.


9

TBR


Public cloud data center build-outs are slowing, causing cloud components demand and growth opportunities to shiftAs public cloud service providers satisfy their base-layer IT infrastructure requirements,incremental enterprise private cloud build-outs will lead cloud components revenue growth


10

Rapid ODM-enableddata center build-outs

Publiccloud components

Privatecloud components

Year

-to-

year

reve

nue

grow

th

2012 2018

We are just ahead of the inflection point in growth

Accelerated migrationby early adopters

Incrementaladoption growth

SOURCE: TBR ESTIMATES

TBR

TBR


Cloud Components Market

With virtualized base-layer hardware in place, customers will shift focus to software-led efficiency and simplicity in 2015

$19.4B

$27.5B

$39.3B

Operations management and security software will lead 2013 to 2018 growth due to the need

to manage and secure hybrid clouds.

Infrastructure

optimization

IT efficiency and

IT operation simplification


11

TBR




Insert Picture

Insert Picture




12

TBR


Managed

Self-built

Solution Routes

Pressure to weigh opportunity cost and time to market is driving more customers to LOB-driven managed private cloud deploymentsGlobal Private Cloud Market

70% of customers adopted

30% of customers adopted“I like having all of my marbles in my hands; with the cloud, I have handed all my marbles to someone else and said, ‘Please look after them, watch out for them.’” — Large enterprise self-built cloud customer

• More LOB involvement• Less centralized purchasing

• Higher IT control• More centralized purchasing

“Say you can do [some function] through the cloud for a million dollars. And IT says, ‘Well, we can do it for $700,000.’ [The] payoff of that would be a no-brainer. But now it’ll take up to six months. What’s the opportunity cost of those five months? So, it drives a different analysis.” — IT Architecture, $10B+ Retail, U.S.

13

TBR


Cloud Expenditures

The pockets of growth in private cloud are shifting from infrastructure to more mission-critical development and application workloads

Decreasing growth rates as initial infrastructure-focused spending loses momentum

Rising importance as private development of environments and application replatforming assume greater importance

The most investment-rich area that will gradually gain momentum in dollars spent; the rate of spending growth will hinge on customer success stories and winning approval for core application migrations.

Solution Routes

14

TBR


Customization Method: Brokerage and Integration

The continuum of brokerage, integration and aggregation will be one of the strongest areas of cloud growth over the next 5 years

Brokerage Integration

•Aggregation (marketplaces)• Integration (of multiple cloud environments and services)• Customization (services-led)

• Platforms (cloud or software)•API management• Catalogs and frameworks

Solution Routes

15

SOURCE: TBR ESTIMATES

TBR

Integration and Aggregation Layer

TBR


Private Cloud Webinar: Q&A

Questions?

16

TBR


Private Cloud Webinar: Contact Information

James McIlroy Vice President of SalesEmail: [email protected]: 603.929.1166

Twitter: @TBRincSlideShare: www.slideshare.net/TBR_Market_InsightYouTube: www.youtube.com/user/TBRIChannelLinkedIn: www.linkedin.com/company/technology-business-research

Allan KransCloud Practice Manager

Email: [email protected] Twitter: @allankrans

17


https://twitter.com/TBRinc

http://www.slideshare.net/TBR_Market_Insight

http://www.youtube.com/user/TBRIChannel

https://www.linkedin.com/company/technology-business-research


TBR


TBR Cloud Research Overview

Continual portfolio expansion elevates TBR’s and clients’ knowledge of what ‘cloud’ means to vendors and customers

Accenture CSC RackspaceAWS Dell ServiceNowAtos Fujitsu TCSCognizant IBM Verizon

Capgemini Microsoft

Deloitte OracleGoogle SAPHP WiproInfosys

Salesforce.comWorkday

Hybrid CloudCustomer Report

Private CloudCustomer Report

Cloud Professional ServicesCustomer Report

Topical Cloud Reports: 2014 reports include Orchestration, and LOB vs. IT

Public CloudBenchmark

Managed Private & Professional Services Cloud Benchmark

Cloud ComponentsBenchmark

18

TBR


Cloud Vendor Reports (Cloud Business Quarterly)

Benchmarks (Benchmark XLS data is also available)

• Accenture Cloud*• Amazon Web Services*• Atos Cloud*• Capgemini Cloud*• Cognizant Cloud*• CSC Cloud*• Dell Cloud*• Deloitte Cloud*• Fujitsu Cloud*• Google Cloud*• HP Cloud*• IBM Cloud*• Infosys Cloud*• Microsoft Cloud*• Oracle Cloud*• Rackspace* • Salesforce.com • SAP Cloud*• ServiceNow* • TCS Cloud*• Verizon Cloud*• Wipro Cloud*• Workday

Public Cloud BenchmarkThe public cloud program compares and analyzes the strategies, results and drivers of 50 key vendors in the public cloud segment across Software as a Service, Platform as a Service and Infrastructure as a Service.

Managed Private & Professional Services Cloud Benchmark*The managed private cloud and professional services program compares and analyzes the strategies, results and drivers of 29 key vendors in the managed private cloud and professional services market across Business Process as a Service, Software as a Service, Platform as a Service, Infrastructure as a Service, cloud consulting, cloud SI and cloud ADM.

Cloud Components Benchmark*The cloud components program compares and analyzes the strategies, results and drivers of 12 key vendors that sell the building blocks of software and hardware used to construct public and private clouds.

Note: There are also three semiannual cloud adoption studies and cloud topic reports (Cloud Security is available now and Cloud Orchestration is upcoming).

Syndicated Research CoverageTBR Cloud Practice Syndicated Coverage

*Semiannual Report

19

TBR

TECHNOLOGY BUSINESS RESEARCH, INC.

About TBR

Technology Business Research, Inc. is a leading independent technology market research and consulting firm specializing in the business and financial analyses of hardware, software, professional services, telecom and enterprise network vendors, and operators.

Serving a global clientele, TBR provides timely and actionable market research and business intelligence in formats that are tailored to clients’ needs. Our analysts are available to further address client-specific issues or information needs on an inquiry or proprietary consulting basis.

TBR has been empowering corporate decision makers since 1996.

To learn how our analysts can address your unique business needs, please visit our website or contact us today.

Contact Us

[email protected] Merrill DriveHampton, NH 03842USA

This report is based on information made available to the public by the vendor and other public sources. No representation is made that this information is accurate or complete. Technology Business Research will not be held liable or responsible for any decisions that are made based on this information. The information contained in this report and all other TBR products is not and should not be construed to be investment advice. TBR does not make any recommendations or provide any advice regarding the value, purchase, sale or retention of securities. This report is copyright-protected and supplied for the sole use of the recipient. Contact ©Technology Business Research, Inc. for permission to reproduce.


http://www.tbri.com/

Cutting through the fog: What is private cloud and what role does it play in the broader IT market?

Technology

private cloud opportunity

cloud customization

private cloud concerns

tbrs private cloud webinar

cloud solution delivery

private clouds

public cloud service

service bpaas cloud