Thursday, July 5, 2012
Not all major changes are visible to the naked eye. Standing next to a glacier it is difficult to determine direction (does it grow or shrink across seasons) and watching continents move takes even some stamina for the casual observer. Luckily this is not the case for cloud computing.
Apart from the very noticeable cloud hype (more on the cycle of that soon) there is also very noticeable growth. At the end of a deep and wide group effort, Gartner published its "Forecast: Public Cloud Services, Worldwide, 2010-2016, 2Q12 Update" accompanied by Market Definitions and Methodology: Public Cloud Services. As I highlighted several years ago in Can the Real Cloud Market Size Please Stand Up? definitions are all important when trying to compare various cloud forecasts and especially cloud forecast categories.
This year I was on the creating side of a cloud forecast, working on “Compute” services, which together with “Storage” and “Print” makes up the section “Cloud System Infrastructure Services (IaaS)”. Other sections in today’s published forecast are “Cloud Business Process Services”, “Cloud Application Services (SaaS)”, “Cloud Application Infrastructure Services (PaaS)” and the new “Cloud Management and Security Services”. I am sure there will be some public press announcements with numbers, percentages and stats later today, so I won’t go into that here.
Most publications picking up on this will likely focus on the overall biggest number ( the total of all cloud services in the furthest away year). Not sure that overall total has the granularity that makes it useful to anyone in particular - as it includes many different markets (IT and non IT) and areas (from IaaS all the way to BPaaS ). But at that level of granularity you could say that the size of the public cloud service market is developing from being roughly the size of Luxembourg’s GDP only a few years ago, via sizes comparable to countries like Oman, Angola, Vietnam, Hungary, New Zealand and Romania, into a size being roughly equal to the current size of the Irish economy by 2016. For reference, today’s overall Enterprise IT spend of 3.7 trillion per year is roughly equivalent to the size of the economy of Germany, so still plenty of room for growth. But that growth has to come from somewhere. One of the more interesting questions –more interesting than absolute size - is which traditional market glaciers are melting (or at least slowing down their progress) as a result of the global warming caused by cloud computing. A lot of the cloud growth comes from enabling stuff (technical term for new services, new markets) that simply was not possible before.
But - with global growth stagnating in some regions - some of the cloud growth will come from cannibalizing traditional markets. Scientists have not yet decided (at least the last time I looked) what actually killed the dinosaur and how long it took for them to become extinct, but for traditional IT it is safe to say it won’t be as sudden as a meteor hit, but it could happen significantly faster than global warming. And just like with these phenomena’ s, some people will be in denial (adapting too late) and others will be adapting too early . Guess –as always- timing is everything, and - as usual - timing is the hardest to get right, something our forecast efforts aim to help with.