Rise of the Cloud-First Enterprise

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It’s no surprise that most companies today use a cloud service or two as part of their IT mix. The latest edition of the Future of Cloud Computing Survey, an annual study from North Bridge, an equity and venture capital firm, and Wikibon, confirms that enterprises are not only adopting the cloud at a torrid pace, for many the cloud is their go-to approach to rolling out software and IT services.

Forty-two percent of those polled – the firms surveyed 1,351 respondents – said they subscribed to a cloud-first or cloud-only IT strategy. Another 49 percent said they make selective use of the cloud. In total, 90 percent of all enterprises rely on the cloud, in one way or another.

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This summer, Oracle acquired cloud business software maker NetSuite for a whopping $9.3 billion. Months earlier, the company spent a combined $1.2 billion to bolster its portfolio of software-as-a-service (SaaS) solutions for verticals by snapping up energy-management specialist Opower and Textura, a cloud software provider for the construction industry.

Moving to the cloud is one way to improve the bottom line.

In a surprise finding, 42 percent of companies said cloud-based applications help them generate at least 50 percent of their business. Nearly 80 percent said they produced some revenue thanks to the cloud.

Hybrid clouds (mixed cloud and on-premises) are the most popular implementation (47 percent), followed by public (30 percent) and private clouds (23 percent). “Cloud environments will remain predominantly hybrid in the coming years, enhancing the importance of a clearly defined cloud governance and orchestration strategy to optimize for security, self-service and agility, while minimizing costs,” commented Holly Maloney McConnell, principal at North Bridge, in prepared remarks.

“The continued growth in the cloud-first enterprise is forcing traditional IT vendors like Oracle to accelerate pace of acquisition to fortify their cloud platform strategies,” McConnell added.

After coming to grips with cloud computing, businesses are venturing into beyond-the-basics applications and services. More than half identified data analytics (58 percent) as a new top priority, followed by containers (52 percent) and the internet of things (48 percent).

“As security continues to improve, cloud environments are extending deeper into verticals and applications, allowing categories like content management and communications to take advantage of both public and private cloud for the digital transformation of industries,” Maloney McConnell said.

Pedro Hernandez is a contributing editor at Datamation. Follow him on Twitter @ecoINSITE.