The Adoption Of Cloud Technology by Enterprises

The Adoption Of Cloud Technology by Enterprises

Introduction

Cloud computing has become a must-have technology for every enterprise. Whether you realize or not, cloud has taken over how the world consumes technology today. And this is true for every business, big or small, new-age or traditional. In fact, cloud computing itself, is now, a big business. According to Gartner Inc., the worldwide public cloud services market is projected to grow at 17.3 percent in 2019 to a total of $206.2 billion, up from $175.8 billion in 2018.

Adopting the cloud has several benefits. You can improve your budget flexibility by shifting spending from Capex to Opex. It improves business agility and flexibility. There is a considerable reduction in time to market for new services. Enterprises have begun to rely heavily on cloud services for automation and to obtain resources on-demand with limitless computing cycles and storage available at the touch of a button.

This paper addresses the primary reasons for the enterprises migrating to the cloud infrastructure, various types of cloud deployment (technology & services) models IaaS, PaaS, SaaS, public cloud, private cloud and hybrid cloud, feature comparison of two popular cloud platforms – AWS and Microsoft Azure, and some examples of how enterprises and consumers are using the cloud technology.

As you read further, the paper presents a case study of a leading organization which is into admission, access control and data management solutions for the entertainment and sports industry. It draws upon  RapidValue’s experience of helping enterprises succeed in the complex cloud ecosystem.

The Adoption Of Cloud Technology by Enterprises

Why Cloud? - Key Benefits

The cloud ecosystem transforms enterprises large and small by offering the potential to engage with more customers with different business models. However, the benefits of cloud may vary from business to  business. Broadly, you can categorize benefits of cloud under three buckets – efficiency, flexibility and strategic value.

Efficiency

The efficiency benefits of cloud are mostly derived from the savings on capital investment and a payment structure that ensures businesses only pay for the resources they use. The ability to provision resources with just a click of a button also enables businesses to get their products to market quickly rather than wait for hardware to be brought in and configured.

Accessibility – The ease with which cloud-based applications can be accessed is one of its prime benefits. Virtually, any authorized user with any internet connected device can access applications and data in the cloud from anywhere in the world.

Speed to market – Developing applications in cloud development platforms provides developers with services that allow them to get their applications to market quickly.

Data security – Data security is one of the biggest concerns for organizations moving to the cloud. But, these concerns have time and again been proved to be myths. In fact, cloud providers like AWS or Azure go that extra mile to ensure data security that probably your organization wouldn’t have spent on. Cloud providers have dedicated specialized staff and automated processes to ensure users are provided with all the latest security measures.

Data backup – If your data is on the cloud, you do not have to worry about backups. Cloud providers provide networked backups so you do not have any data loss even in cases of hardware failure.

Savings on equipment – Moving to the cloud saves organizations the cost of buying and setting up servers and other equipment.

Pay structure – The payment structures of most cloud providers are such that users only pay for the resources they use.

Flexibility

The Flexibility benefits of cloud are mostly derived from the fact that users can scale services to fit their needs whenever required.

On-demand scalability – Cloud computing provides infinite computing resources to the users. Resources can be provisioned or released according to fluctuating workloads. Cloud services are able to handle high traffic demand, as the resources can be expanded, elastically. When the demand tends to get subsided, the resources, which are not needed, are, then, released, automatically.

Storage options – Cloud service providers offer various options like private, public or hybrid cloud. The user can choose according to their data requirements, security requirements and other considerations.

Tool selection – Cloud providers provide users with pre-built tools and features to build solutions that fit the user’s specific needs.

Resilient – Resiliency is important for any enterprise, since organizations depend on digital data to run their day-to-day operations. Cloud technology platforms have proved to be more resilient than the traditional storage solutions. This means, if a part(s) of the cloud platform fail(s), then the rest of the platform resources are able to function, until the problem/issue is solved.

Strategic Value

Moving to the cloud gives enterprises a competitive advantage as cloud providers offer the most innovative, latest technologies available in the market which can be leveraged by the users.

Superior collaboration – One of the most popular feature of cloud computing is all your data being updated in real-time. Cloud computing allows employees to operate from any location with an internet connection. The employees can synchronize their documents in high speed and it appears as if they are working from an office room.

Development and testing – During development and testing processes, cloud computing works in the most effective manner. You can set up your environment, through physical assets, with significant manpower and in a much shorter span of time.

Disaster recovery – Disaster recovery is yet another benefit which is derived from using cloud services. The cost effectiveness of a disaster recovery (DR) solution, which is provided by cloud computing, gives you a faster recovery. This is much advanced than the traditional DR site, which has rigid procedures and a much higher cost.

Streamlined work – Cloud service providers manage all the underlying infrastructure enabling you to focus on your priorities like application development.

Regular updates – Providers will keep updating their offerings to give users the latest technologies.

The Adoption Of Cloud Technology by Enterprises

The Cloud Deployment Models Technology

There are several types of deployment models available to host systems and applications on the cloud.

Technology Models

The three most popular cloud computing models are:

Public Cloud – Computing resources, provided by cloud, have been adopted by various organizations and enterprises, through the public Internet. Cloud providers ensure that there is a kind of separation for the resources that are used by different enterprises and organizations. It is based on the standard cloud computing model. The service provider builds resources – the applications and storage. These resources are available to the public through the Internet. Public cloud services can be obtained, either, free or bought on a ‘pay-per-usage’ model.

Private Cloud – Cloud infrastructure is, entirely, owned by the enterprise and maintained, either, by the enterprise or a third party. It can be located either on-site or off-site. Private cloud is a cloud computing platform, which is implemented within the corporate firewall. It is under the control of the IT department. A private cloud is designed in such a way that it offers the same features and benefits of the public cloud systems. But private cloud removes a number of objections to the cloud computing model. This includes control over the enterprise and customer data, issues about security, and concerns connected to regulatory compliance.

Hybrid Cloud – Hybrid cloud is considered to be the combination of any type of cloud model mentioned above, connected by a standardized technology. It is a combination of, on and off premises. Hybrid cloud offers the best of both the worlds and performs distinct functions, within the same organization.

Hybrid Cloud is the most preferred strategy.

Adopting a hybrid cloud approach is said to support the testing application workloads. This provides the comfort of an environment, without the initial investment, that might have been rendered useless, should the workload testing fail. Another use of the hybrid cloud is the ability to expand during periods of limited peak usage. Moreover, there is one more deployment model which is still gaining popularity; especially in the healthcare industry, which is the community cloud.

Community Cloud – As for Community cloud, the cloud infrastructure is said to be owned and shared by multiple organizations, with a shared concern.

Service Models

On the services side, there are four key service models in cloud computing:

Infrastructure as a Service (IaaS) – It is the delivery of computing infrastructure as a service. IaaS is using an existing infrastructure which can be adopted on a pay-per-use scheme. Because of this reason, it has become an obvious choice for the organizations. Companies find it useful as they can save on the infrastructural cost. IaaS is the fastest growing segment of the market. Gartner forecasts cloud system infrastructure services to grow 27.6% in 2019 to reach $39.5 billion.

Platform as a Service (PaaS) – Providers deliver not only infrastructure but also middleware (databases,messaging engines etc.) and solution stacks for the application, build and development and deploy. Organizations are willing to get PaaS for the same reasons. Enterprises desire for speed. Gartner forecast that the PaaS market will reach $18.8 billion in 2019 and could reach to $27.7 billion by 2021.

Software as a Service (SaaS) – They are applications, which are hosted by a provider on a cloud infrastructure. These applications are accessed over the network or they are accessed over a program interface, for instance, web services. SaaS is the largest segment in the cloud market. According to Gartner, the revenue from SaaS is expected to grow 17.8% to reach $85.1 billion in 2019.

Business process as a Service (BPaaS) – Users increasingly expect deep domain expertise, technology and global deployment capabilities from their cloud providers. In BPaaS cloud providers provide service portfolios that bridge legacy offerings and support new automated, digital and cloud service delivery paradigms. Gartner forecasts a revenue growth of 7.9%, to reach $50.3 billion in 2019.

The Adoption Of Cloud Technology by Enterprises

The Growing Cloud Technology

Mobile Backend as a service (MBaaS), Storage as a service (SaaS) and Communications as a service (CaaS) are three variants which emanates from the above service models. For more details on MBaaS, please read the whitepaper, ‘How MBaaS is changing Enterprise Mobility Landscape’

Examples – Use cases, Reasons for Migration and Popular Cloud Technology Providers

CIOs are trying to craft out well-planned strategies that include cloud technology services. Hence, more and
more companies have started to adopt cloud services. The increased competition in the cloud space will pave the way for better products, efficient services and greater innovation. It is expected that, as cloud services gain more popularity and continue to get adopted by the organizations, a large number of application developers will be seen as developing for the cloud.

This section illustrates some of the ways ‘the cloud’ is being implemented by enterprises and the global cloud technology providers.

Popular Technology Providers

As we mentioned before, the cloud services market will be worth about $206.2 billion in 2019. Many companies have spawned, big and small, offering cloud services and trying to get their share of the $206.2 billion. However, the top cloud providers are those that have moved the business customers past the infrastructure phase and into the high-value domain of AI and ML driven competitive advantage. Here are the top 3 the cloud service providers in the world

1. Amazon Web services – AWS dominates the public cloud space with over 40% of the market share. They provide a wide range of infrastructure services like database storage, computing power, networking, serverless computing along with memory cache system and auto scaling.

2. Microsoft Azure – Azure currently holds about 30% of the market. However, Microsoft Azure is the fastest growing cloud service provider in the market. Azure has deep involvement in all the 3 layers of the cloud, IaaS, SaaS & PaaS. Azure has been developing and helping customers to deploy AI, ML and blockchain in innovative production environments.

3. Google Cloud – Google only shares about 3% of the market but they provide an elastic and  inexpensive cloud computing experience for users with a slightly tight budget. The Google Cloud Platform enables users to create business solutions using Google-provided, modular web services. It offers a wide array of services including IaaS and PaaS solutions.

Current and planned usage of cloud platform services running applications worldwide in 2018

Feature Comparison – AWS, Microsoft Azure

The following table shows subset of services provided by AWS and Azure for each layer of digital platform.

The Adoption Of Cloud Technology by Enterprises

Case Study: Enterprise Ticketing System Hosted On Cloud

About the Client

The client offers a complete array of custom tickets, parking permits, roll tickets, design, and packaging & distribution services in the United States.

Business Challenge

For the past 20 years, the client has developed and sold an easy-to-use portable box office ticket device
called KIS. They wanted a transition from the features and functions of their traditional KIS hardware to an Enterprise Ticketing System (“ETS”) called “KIS Ticket”. Unlike other online ticket applications, KIS Ticket is intended for use by professional box office managers and their staff. The ETS allows for the simple sale or issuance of general admission event tickets, parking passes, wristbands, event credentials, merchandise and access control.

Delivering Multi-channel Solution

RapidValue designed and developed the web application and the mobile application. The important features of the solution are as follows:-

  The application is hosted on Amazon Web Services cloud.

  • Admins can use the web application to manage customers, create ticket templates, provide customer support, view reports and get notifications from customer registrations. 
  • Box office managers use the web application to manage events, manage sellers, customize ticket designs and manage ticket sales.
  • Sellers can select sales point, sell tickets, capture digital signatures, scan tickets, receive payments and refund tickets.
  • The solution is integrated with payment gateway to enable online ticket sales and can also be integrated with 3rd party hardware devices for ticket scanning, printing and card swipe.

The ticketing system solution uses the client’s core ticket engine running on the Amazon Web Services cloud
platform. Using AWS allows the client to benefit from a broad set of Amazon’s compute system tools, highly
scalable processing power, security protocols, storage capacity, database and analytics backend services.

Results

The client derived the following results by implementing the solution:

  • Reduced Event management Cost – The solution reduced total event management cost by 50%.
  • Start Selling in Minutes – The solution allows users to set up event and start selling tickets in just 5minutes.
  • Track Sales from Anywhere in Real-Time – Access real-time sales and check-in data, manage event 24/7, from any device.
  • High Scalability – The solution is hosted on AWS which allows on-demand provisioning of additional servers, which helps to constantly adjust capacity and costs to actual traffic patterns.
  • High Security – The solution provides host level security with Amazon EC2 and additional security features are added through AWS WAF in-line with CloudFront to defend against attacks such as cross-site scripting, SQL injection, and DDoS.
The Adoption Of Cloud Technology by Enterprises

The Future of Cloud

Many years from now, when we are travelling in our self-driven electric cars, going to meet our AI driven robotic personal trainers, historians will look back at 2010s as the cloud decade. The idea of cloud computing and cloud storage has dominated this decade. You could argue that the idea of cloud computing was formulated in the 1960s but it really had its “renaissance” moment in 2006 when Amazon launched EC2 in the market and 2010 when cloud had taken the stage as the transformational technology of our generation.In 2018, we crossed a significant 50% adoption milestone and cloud applications, platforms and services will continue to radically change the way enterprises compete for customers.

What to Expect?
  • 100% adoption of the cloud – Cloud has been such a buzzword for so long you’d think that every company has moved to the cloud. But it is not so. We have only reached about 50% adoption in 2018 according to Forrester. That leaves a lot of room for additional cloud adoption. But as cloud provider go all out to strengthen cloud security and provide additional value added services, cloud adoption will gather speed as more and more companies will flock to it.
  • Edge computing will redefine the cloud – In this digital edge, more and more companies are going to need instant access to data and compute large resources to serve customers faster. This is one of the biggest new opportunities for the cloud with its new technology called Distributed Cloud Infrastructure which enables Edge Computing. Edge computing pushes certain compute processes away from centralized data centers to points in the network closer to users, devices and sensors. Edge computing is very valuable for the Internet of Things which needs to collect and process huge amounts of data in real-time with minimal latency.
  • Containerization is just going to rise and rise – Containers enable developers to manage and easily migrate software code. Many companies are using containers to enable portability between cloud services from AWS, Microsoft Azure and Google Cloud as they build out their DevOps strategies for faster software production. This trend will only grow in the next decade. 451 Research forecasts that the application containers market will grow at a rate of 40% CAGR to $2.7 billion in 2020.
  • Serverless computing becomes popular – In serverless computing, a cloud provider manages code execution, executes it only when needed and charges only when the code is running. Developers do not need to buy expensive servers to develop and deploy application anymore. The world got to know of serverless computing when AWS launched Lambda in 2014. Serverless computing has huge potential and its usage will only increase over time. However, it will require an enormous rethink of the traditional ways of developing/producing software.

Thanks to the cloud, the development ecosystem is thriving. It has allowed developers to use DevOps strategies to develop applications faster. It has provided tools to enable build automation and fostered application delivery and availability. Cloud will continue to fuel digital transformation initiatives for the rest of the decade and beyond. As cloud technology can only evolve and improve and with so many new exciting trends coming up, you can safely predict that the best days for cloud computing are still ahead.

Shuvro S. Sarkar
Sr. Marketing Consultant,
RapidValue

Nairita Goswami
Marcom Specialist,
RapidValue

If you’d like to know more about Cloud Solutions, please reach out to us at contactus@rapidvaluesolutions.com

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