Conversations around digital transformation, artificial intelligence and big data analytics inevitably turn to cloud computing, the great enabler of many modern enterprise achievements.
More businesses are moving IT spending to the public cloud, but the bulk of enterprise IT is still sitting in traditional computing environments.
In 2018, big cloud providers kept getting bigger, often at the expense of smaller players. Gartner surprised many by dropping eight vendors off of its infrastructure as a service Magic Quadrant, leaving just six frontrunners on the board.
In the leaders board: Amazon Web Services, Microsoft Azure and Google Cloud Platform. And in the niche players: Alibaba Cloud, IBM and Oracle.
From hybrid and multicloud environments to the platform and software as a service layered on top, the cloud will continue shaping not only how business compute, but how they work. In 2019, even businesses well into a cloud migration will have to reassess what cloud computing means for their portfolio and near- and long-term strategies.
These five trends will shape enterprise cloud computing in 2019:
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Hybrid grows in prominence as cloud providers double down
"Moving to the cloud" can mean a thousand different things. Businesses have to choose between public and private options, and within those scores of choices abound.
It's easy for business to fall into the trap of trying to imitate the public cloud through private cloud means, according to Michael Warrilow, VP analyst at Gartner, in an interview with CIO Dive. Many companies have tried and failed.
For private cloud, businesses essentially have three options, according to Forrester Research: Build in-house with vSphere or OpenStack, or have a provider build it for them. Legacy systems will factor in to each option and demand integration.
The "dangers" of private cloud have made hybrid cloud the most popular option for many businesses, Warrilow said.
Big cloud providers are responding to the demand for hybrid and multicloud options.
AWS Cloud recently launched an offering for on-premise compute and storage capabilities for customers. Perhaps a little late to the game, the move helps legitimize the hybrid cloud focus other cloud providers have already been pushing, Warrilow said.
IBM also took a huge plunge in hybrid with the $34 billion acquisition of Red Hat.
Building hybrid capabilities will be a foundational element for businesses in 2019, according to Warrilow. Storage, network and identity will be the key parts of a successful bridge for hybrid cloud.
Multicloud is also a popular option for many businesses that can't put all their systems and data on one option. But handling multiple clouds — sometimes even upwards of 10 — multicloud management emerges as another priority to juggle.
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Businesses are still balancing with heavy noncloud workloads
Even in 2019, most workloads will not be in the public cloud.
Estimates today only have 10% to 20% on public cloud today, according to Warrilow. That means the bulk of enterprise spending is also not going to the cloud (hint: it's actually going to people).
Even though cloud-based offering spending will grow faster that noncloud over the next several years, cloud will remain a smaller portion of enterprise IT spending, according to Gartner. In 2018, 19% of cloud spending went to cloud; by 2022, that is expected to rise to 28%.
With noncloud workloads still dominating the bulk of IT market revenue, businesses in 2019 will continue investing in hybrid cloud use cases, according to Gartner. Cloud shift from noncloud to public cloud is an opportunity, and product engineering and go-to-market investments will help target those.
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The time for 'cloud first' is over
The cloud is not an end destination, but a journey. And the time for being "cloud first" has passed.
Now, businesses will transition to SaaS first, cloud second and IaaS third, according to Warrilow. It's important to make sure they aren't just indulging on moving workloads from one location to another, but rather transforming with the full benefits the cloud has to offer.
The API economy will be particularly transformational to cloud computing in the coming years, according to Warrilow, even if it isn't a popular topic of conversation right now. By 2020 and beyond, edge computing will also come into the mix, and hybrid and PaaS will refactor existing applications.
The belief that there is some simple, magical cloud-first approach is misplaced, according to Warrilow. The cloud is a lot of things and changing every year, and companies are keying in on software capabilities.
SaaS-based ecosystems will emerge that connect organizations in real-time, promote intercompany collaboration and support analytics, according to Forrester Research. Industries such as government, healthcare and manufacturing will be early candidates for strong information sharing and collaboration needs supported by these ecosystems.
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More focus on PaaS, serverless and containers
While IaaS and SaaS have moved through the Gartner Hype Cycle to the "plateau of productivity," PaaS is still lingering in the "slope of enlightenment," two to five years away from the plateau.
PaaS is being pushed from below by infrastructure but also squeezed from above, according to Warrilow. The Salesforce-MuleSoft acquisition is a good example of this.
In 2019, PaaS strategy will have to balance the experiences of "Day 1," the building and deploying, with "Day 2," the governance, according to Forrester Research. Businesses will have to decide whether to remain cloud neutral or get their PaaS from a provider.
The industry is seeing a lot more innovation in hybrid PaaS, containers and microservices, according to Warrilow. PaaS, the "glue between infrastructure and application," and these other technologies offer huge transformational benefit for businesses.
Containers, kubernetes and serverless computing offer distinct advantages for enterprise computing based on scaling, cost and what a business needs virtualized..
With containers, businesses don't have to build from scratch and can instead leverage scalable, distributed services from public PaaS, according to Warrilow.
For Kubernetes, 2019 will be all about making the orchestration management platform easier to deploy, monitor, secure and scale alongside the rapid growth in enterprise-ready container platforms.
These technologies will reshape core enterprise applications and help companies roll out digitally-native platforms that span across clouds, according to Forrester.
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Cloud changes affect team organization
Cloud will continue to disrupt not only how enterprises compute, but how IT pros work. Everything is speeding up, and teams have to adjust to a faster cycle and more complex computing environment.
Cloud helps a company reduce technical debt and quicken innovation and agility, which will have natural repercussions in organizational structure. The structure of the modern IT organization as it adopts the cloud has been a growing focus for many client inquiries, according to Warrilow, who expects this trend to continue well into 2019 and beyond.
A continuation of lift and shift projects would not serve many businesses well because it fails to unlock the full potential of the cloud, Warrilow said. The cloud isn't just about saving money, and businesses that succeed approach it in terms of what value can the cloud unlock that traditional computing approaches cannot.
Businesses approaching cloud just from a cost savings perspective demonstrate that the value proposition isn’t based on what technology and information can bring to the business.
Businesses will also have to refocus procurement, turning more focus onto consumption and expense management, he said. Businesses that want to increase use of the cloud need to be able to show they can handle unpredictable consumption and demonstrate value quickly.
Correction: This article has been updated to reflect that IBM has acquired Red Hat for $34 billion.