Cloud computing now the norm in a predominantly Hybrid IT market

Cloud computing has achieved mainstream deployment in the UK according to the latest research from the Cloud Industry Forum (CIF), with some 78 per cent of organisations formally adopting at least one Cloud-based service.

The research, conducted in June 2014, polling 250 senior IT and business decision-makers, indicated a nine-point increase or 15 per cent growth over the last research project conducted in September 2013. This suggests an annualised growth rate of nearer 20 per cent by the end of September 2014. Since the first research was conducted in 2010, UK Cloud adoption has grown by 61.5 per cent.

Large private enterprises are showing the highest rates of adoption at just over 80 per cent, whilst the sub 200 employee organisations are standing at around 75 per cent and the public sector is still lagging at around 68 per cent.

To set context, the research also recognises that the majority of organisations (85 per cent) operate on-premise servers or data centres. The existence of on-site technology is also a direct influence on the evolution of IT strategy based on historical investment. The co-existence of on-premise and Cloud services by nature leads to a Hybrid IT environment for the majority of organisations.

Key findings include:
· Of those using Cloud services, 45 per cent use only one Cloud service formally, 28 per cent use two Cloud services, 13 per cent use three and the remaining 14 per cent use four or more
· 79 per cent of organisations now formally consider Cloud as a part of their IT strategy
· 72 per cent of organisations make new IT deployment model decisions based around infrastructure refresh
· 61 per cent of organisations reported running Windows Server 2003, which formally goes end of support in July 2015 and will drive a new wave of opportunity for Cloud services adoption over the next year
· 78 per cent of organisations run IT predominantly with in-house personnel and 22 per cent use a managed service provider. MSPs have greatest penetration in the sub 20 employee organisation, where 38 per cent claim to rely on an MSP
· Web hosting, email, CRM, data back-up and disaster recovery continue to be the most pervasive Cloud services used. This is followed close behind by video conferencing, collaboration solutions, HR apps and data storage
· Looking into the drivers for first time Cloud adoption, flexibility of Cloud as a delivery model continues to be cited as the primary reason for adoption among private sector companies (17 per cent), while operational cost savings dominates the public sector (21 per cent)

Alex Hilton, CEO of CIF, stated: “We have now conducted five research projects over 48 months looking at Cloud adoption in the UK, and as such have a sound basis for assessment and evaluation of trends. Over the next year we can say with some confidence that first time Cloud adoption will increase by 12 points – or 15 per cent in real terms. This means that 90 per cent of all businesses in the UK will be formally using at least one Cloud service by the end of 2015. In the near term adopting will be driven in part by the end of support for Windows Server 2003 that concludes in July 2015.

“We can also predict that 10 per cent of businesses will likely report a primary Cloud-based IT strategy, 10 per cent will remain entirely on-premise and 80 per cent will have a Hybrid IT environment. This means that nine out of ten companies will continue to invest in on-premise IT alongside and integrated with Cloud solutions. In other words we are in fact seeing the normalisation of Cloud in the Hybrid IT market.”

Clare Barclay, General Manager Microsoft UK, Small, Mid-Market Solutions & Partner Group and a CIF Member welcomed the report, added: “What is clear is that Hybrid IT is fast becoming the principal technology within business. The research has confirmed that the role of IT is now firmly established as an enabler of services, business agility and transformation rather than just a cost centre to deliver services and devices.”

Nick East, CEO of Bath-based Zynstra, pioneers in Cloud managed server appliances for SMBs, said of the research: “SMBs are vital to the wellbeing of the economy and make up the majority of businesses in the UK. This research showed that over half of SMBs are running IT systems that are close to the end of their supported life. SMBs are turning to Cloud, with 69 per cent stating they consider an infrastructure refresh to be an opportunity to adopt a managed Cloud solution.”

Nick continued: “With this in mind SMBs need to consider which Cloud solutions are going to be the best fit for them in the future. Leaving it until the end–of–support date has passed is going to cause a major IT headache.”