In a rapidly evolving cloud landscape, these emerging cloud trends highlight the importance of optimizing costs, ensuring resilience, and driving innovation.
Gartner predicts that by 2025, the dominant share of IT spending will be for public Cloud, shifting away from traditional solutions and rising up to 51% of the total spend as compared to 41% in 2022. This includes enterprise IT categories of application software, infrastructure, business process services, and system infrastructure. Almost two-thirds (65.9%) of spending on application software is predicted to be channeled toward cloud technologies alone. With that said, here is a look at the emerging cloud trends that are impacting businesses today.
Factors Accelerating Cloud Adoption
The COVID-19 pandemic acted as a powerful catalyst for fast-tracking the digitalization drive in organizations. It underscored the importance of cloud-based solutions in ensuring business continuity, facilitated a dispersed workplace, and supported the growing demand for online services.
Post-pandemic, as businesses faced an economic slowdown, fluctuating demands, and evolving customer expectations, the ability to scale resources up or down quickly became crucial. Cloud services offer on-demand scalability, allowing organizations to optimize resource allocation and avoid upfront infrastructure investments. This further provided an impetus for embracing cloud technologies and leveraging their potential for driving competitiveness, agility, and long-term growth.
The growing interest in innovating and working with artificial intelligence (AI) and machine learning (ML) has further intensified the emphasis on using cloud computing. AI and ML require massive computational power, extensive data storage, and efficient processing capabilities, all of which can be seamlessly provided by cloud infrastructure. AI/ML requires specialized hardware and software, which are out of reach of many organizations. The Cloud acts as an enabler for organizations seeking to leverage the potential of AI and ML, providing the resources for training and deploying complex models. With cloud-based AI/ML solutions, businesses harness the power of advanced analytics, predictive modeling, and automation to gain valuable insights, optimize operations and drive innovation.
As the digital juggernaut gains speed, the volume of data being generated and stored by organizations is increasing exponentially. Recognizing the critical importance of safeguarding valuable information from breaches and cyber threats and protecting sensitive personal information, businesses actively seek cloud solutions that provide robust security measures. Cloud providers employ dedicated security teams that stay updated with the latest threats and ensure the infrastructure is fortified against potential vulnerabilities. With enhanced data protection features like access controls, encryption at rest as well as in transit, and continuous monitoring, businesses prefer the Cloud to bolster their data privacy and security measures, often surpassing what they could achieve on their own.
As data volumes and computational requirements increase, the flexibility and scalability of cloud computing allow organizations to adapt quickly. They scale their resources up or down easily according to their needs, ensuring optimal performance and cost-efficiency. This agility allows businesses to respond quickly to changing market demands, handle peak workloads, and accommodate growth without the need for significant capital investments.
Emerging Cloud Trends
With the benefits of scalability, cost savings, enhanced collaboration, data protection, and the ability to foster innovation, cloud solutions have developed as a fundamental pillar of modern business operations. While cloud computing continues to evolve, the most significant emerging trends are:
Ensuring Better ROI
As enterprises continue to increase their usage of cloud services, there is a growing focus on optimizing the return on investment (ROI) on cloud costs. Managing and optimizing cloud expenses poses a huge challenge, especially as exploding data volumes drive up cloud compute costs.
Estimating and forecasting cloud costs is complex and often inaccurate. The dynamic nature of cloud environments, with resources being provisioned and deprovisioned on-demand, makes it difficult to keep track of usage and control expenses. When dealing with fluctuating workloads, businesses may end up overprovisioning resources leading to unnecessary costs, or under-provisioning resulting in performance issues.
The growing trend of cloud cost optimization goes beyond simple cost reduction. Enterprises are increasingly looking for ways to align cloud costs with business outcomes. This involves evaluating the impact of cloud investments on revenue generation, customer satisfaction, and overall business performance. By measuring the ROI of cloud initiatives, organizations can make informed decisions on resource allocation, prioritize high-value projects and ensure that their cloud investments contribute to tangible business outcomes.
Cloud cost visibility and governance also pose challenges. Businesses need tools and processes to gain clear insights into their cloud spending, track costs across various projects or departments, and allocate expenses accurately. Without proper governance and cost management strategies, businesses face difficulties in attributing cloud costs to specific areas of the organization.
Focus on FinOps
With an increasing emphasis on cost optimization of cloud usage, FinOps has gained prominence as a means to bridge the gap between business needs and budget. It is a forward-looking approach, now emerging as a practice that addresses the challenges of cloud cost management.
FinOps involves analyzing cloud costs based on business logic and implementing strategies to optimize cloud environments at a technical level. By emphasizing the importance of financial operations, organizations can avoid unexpected and excessive expenditures resulting from cloud usage. This practice also aligns with the priorities of the developers and cloud users.
Statista reports from a global survey that getting engineers to take action is the largest challenge in cloud cost management. Hence, FinOps practitioners advocate for multidisciplinary collaboration between engineering and finance teams to ensure cost optimization while achieving desired results. This collaboration brings together diverse skill sets to address the complexity of the task. It includes producing predictable costs and forecasts, as well as fostering a sense of ownership among individuals involved in cloud deployment.
Increasing Adoption of Multi-Cloud
Another emerging cloud trend is the adoption of multi-cloud architectures, which is experiencing a significant increase among enterprises. This approach involves leveraging multiple cloud service providers to build a distributed infrastructure that spans across different cloud platforms. There are several reasons driving this trend, including the need for enhanced resilience, mitigating the impact of a service interruption, and avoiding vendor lock-in. By strategically distributing workloads and data across multiple platforms, enterprises can ensure business continuity, maintain flexibility and optimize their cloud infrastructure based on specific needs.
When workloads and data are distributed across multiple cloud providers, it mitigates the risk of a single point of failure. If one cloud provider experiences an outage, the workload can seamlessly transition to another provider, ensuring uninterrupted operations. This redundancy and fault tolerance help businesses maintain high availability and minimize the impact of service disruptions on their operations and customers.
Another crucial benefit is the prevention of vendor lock-in. By using multiple cloud providers, enterprises avoid becoming overly dependent on a single provider’s services, tools, and infrastructure. This strategic decision enables businesses to maintain leverage during contract negotiations, prevent potential price hikes, and maintain the ability to switch providers if necessary. Multi-cloud architectures empower organizations to maintain flexibility and freedom of choice, ensuring they can adapt to evolving business needs and technological advancements.
A multi-cloud approach also allows enterprises to take advantage of the unique capabilities and strengths offered by different cloud providers. Each provider has its own set of services, pricing models, and geographical coverage. By leveraging multiple cloud platforms, organizations select the most suitable and cost-effective services and features from each provider, tailoring their architecture to specific requirements. This approach maximizes the benefits derived from each cloud provider’s strengths.
However, adopting multi-cloud architecture also introduces challenges. It requires careful planning and management to ensure seamless integration, interoperability, and consistent governance. Enterprises need to invest in monitoring tools that provide unified visibility and control over their multi-cloud environment. Additionally, managing data consistency, security, and compliance across different cloud providers can be complex.
While it presents these challenges, a well-designed, executed, and implemented multi-cloud strategy can significantly impact an organization’s ability to adapt, innovate and thrive in an increasingly cloud-centric landscape.
More Cloud Services are Going Serverless
Another of the emerging cloud trends is that of services adopting serverless architectures is gaining momentum and is expected to continue in the future. Traditionally, cloud services required users to provision and manage virtual machines or containers to run their applications. Serverless computing instead abstracts away the underlying infrastructure, enabling developers to focus solely on writing code. This shift empowers them to be more productive by focusing on delivering value from applications rather than managing infrastructure.
With serverless architectures, applications can automatically scale up or down in response to incoming requests or workload spikes, thus ensuring optimal performance and cost efficiency. This scalability is achieved through the use of functions or microservices that are triggered on demand, eliminating the need for idle resources and reducing overall costs.
Managed services such as databases, authentication systems, or messaging queues can easily be integrated into serverless applications, resulting in accelerated development and deployment cycles. Thus, serverless architectures set the stage for a faster time-to-market for applications.
Another advantage of serverless computing is its pay-per-use pricing model. With traditional cloud services, users pay for allocated resources regardless of actual usage. In contrast, serverless architectures charge users only for the actual execution time of their code. This granular pricing model allows businesses to optimize costs and pay only for the resources consumed during application execution leading to potential cost savings.
As businesses recognize the benefits of serverless computing, cloud service providers are expanding their offerings to include serverless options for a wide range of services, from compute and storage to databases and analytics. This expansion allows developers to build entire applications or systems using serverless components, further simplifying development and operations.
A final word about cloud trends
These emerging trends in cloud computing reflect the evolving needs and priorities of businesses. As they recognize the need to optimize cloud costs and align them with business outcomes, the focus is on FinOps practices to maximize the return on their cloud investments. By distributing workloads and data across multiple cloud providers, businesses are ensuring uninterrupted operations, maintaining flexibility, and taking advantage of the unique strengths and services offered by each platform. With the benefits of automatic scalability, faster time-to-market, and a pay-per-use pricing model, serverless computing is trending with increasing adoption.
In a rapidly evolving cloud landscape, these emerging trends highlight the importance of optimizing costs, ensuring resilience, and driving innovation.