2012 State of Cloud Computing: Rep Rts

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rep or ts.informationweek.com Februar y 2012 $99
2012 State of Cloud Computing

More than
500 IT pros weighed in on their use of public
cloud services, and we can sum the results up in two words: blind leap. Just
28% assess the impact on their internal networks, even though 73% are using multiple providers.
Its not too late to reverse the lemming migration. Heres how. By Michael Healey
Report ID: R4020212
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CONTENTS
3 4 6 7 9 10 11 13 15 15 18 19 29
Authors Bio Executive Summary Research Synopsis The Cloud You Didnt Know You Had The Reality of SLAs Impact Assessment How to Make Cloud Soup A Healthy Helping of Worry Can You Go All In? Three Points on a Path The Big Leap Appendix Related Reports
16 Figure 9: Future Degree of Cloud Use 17 Figure 10: Use of Cloud Computing Services 19 Figure 11: Cloud Providers in Use 20 Figure 12: Planned Cloud Provider Use 21 Figure 13: Replace or Fire a Cloud Provider? 22 Figure 14: Greatest Performance Inhibitor 23 Figure 15: Cloud-Based App Performance 24 Figure 16: Change in Performance 25 Figure 17: Job Title 26 Figure 18: Company Revenue 27 Figure 19: Industry 28 Figure 20: Company Size
TABLE OF
Figures 7 Figure 1: Identifying Cloud Impact on InternetFacing Architecture 8 Figure 2: Monitoring Cloud-Based App Performance 9 Figure 3: Cloud SLAs 11 Figure 4: Number of Cloud Providers Used 12 Figure 5: Integrating Cloud Applications 13 Figure 6: Cloud Provider Preference 14 Figure 7: Cloud Services Concerns 15 Figure 8: Weighing the Risk
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Michael Healey InformationWeek Reports
Michael Healey is the president of Yeoman Technology Group, an engineering and research firm focusing on maximizing technology investments for organizations, and an InformationWeek Reports contributor. He has more than 23 years experience in technology and software integration. Prior to founding Yeoman, Mike served as CTO of national network integrator GreenPages. He joined GreenPages as part of the acquisition of TENCorp, where he served as president for 14 years. Prior to founding TENCorp, Mike was an international project manager for Nixdorf Computer and a Notes consultant for Sandpoint Corp. Mike has taught courses at MIT Lowell Institute and Northeastern University and has served on the Educational Board of Advisers for several schools and universities throughout New England. He has a BA in operations management from the University of Massachusetts Amherst and an MBA from Babson College. He is a regular contributor to InformationWeek, focusing on the business challenges related to implementing technology. His work includes analysis of the SaaS market, green IT and operational readiness related to virtualized environments.
2012 InformationWeek, Reproduction Prohibited
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SUMMARY
EXECUTIVE
Next time that annoying guyyou know the onestarts going on about how the cloud is going to change everything, smack him upside the head. Everything has already changed, say the 511 business IT professionals, all from companies with 50 or more employees, responding to our InformationWeek 2012 State of Cloud Computing Survey. Adoption of public cloud services has been on a consistent upward pace for the past four years, since we began keeping track. One-third of 2012 respondents organizations are already receiving services from a cloud provider, and an additional 40% are in the planning or evaluation stages. Just 27% say they wont consider it. In our 2008 cloud survey, people couldnt even agree on a definition21% of 456 respondents from companies of all sizes said cloud was pretty much a marketing term used haphazardly. OK, so not everything has changed. Still, frustration with vendor hype aside, all types of public cloud services, whether SaaS, IaaS or PaaS, are gaining followers. So ITs got this down, right? Not so fast. Were seeing major gaps in how organizations are selecting, integrating and monitoring the services their employees depend on. The bulk of cloud initiatives come from the ground up and are reactive, in response to line-of-business requirements. IT rarely has an overarching vision of how it all fits together. Dont believe us? Then explain why only 28% of organizations scope out the potential impact of a cloud service on their internal architectures prior to going liveespecially given the transition our data centers are going through. Or that 24% have no performance monitoring in place at all. It gets worse. Almost half of respondents have opted to custom code each application directly into internal back-end systems, with only 9% leveraging cloud integration providers. Thats an expensive omission: Integrators large and small not only have ready-made tools, they can help you conserve bandwidth, as well discuss. Combine this customization nightmare with the fact that 73% of respondents already use multiple
February 2012 4
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SUMMARY
EXECUTIVE
cloud providers, and we foresee heartburn in our future. In fact, it appears that the bloom is already off the rose for some. While were still hiring cloud providers, this year, we saw a clear downward trend in opinions about performance and vendor satisfaction levels. In fact, 14% of organizations have fired a cloud provider, with 22% of those saying it had a major or catastrophic impact on the business. We expect the march to the public cloud to continue unabated, spurred by the siren song of lower costs, quicker implementation, and even less need for internal IT. Should we just fall in line and accept the inevitable? Not so fast. Cloud computing is still very much a work in progress, wedged somewhere between CB radios and penicillin on the worldwide-usefulness scale. Providers offers of lower initial cost and faster ramp up have lulled many organizations into a sloppy start, but you can get back on track. In this report, well lay out the critical steps every organization needs to take to make sure its cloud leap goes on more than just faith.
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SYNOPSIS
RESEARCH
Survey Name InformationWeek 2012 State of Cloud Computing Survey Survey Date December 2011 Region North America Number of Respondents 511 at organizations with 50 or more employees Purpose To determine in the role of cloud computing in the enterprise Methodology InformationWeek surveyed business technology decision-makers at North American companies with 50 or more employees. The survey was conducted online, and respondents were recruited via an email invitation containing an embedded link to the survey. The email invitation was sent to qualified InformationWeek subscribers.
ABOUT US
InformationWeek Reports analysts arm business technology decision-makers with realworld perspective based on qualitative and quantitative research, business and technology assessment and planning tools, and adoption best practices gleaned from experience. To contact us, write to managing director Art Wittmann at awittmann@techweb.com, content director Lorna Garey at lgarey@techweb.com, editor-at-large Andrew
Conry-Murray
at acmurray@techweb.com, and research managing editor Heather Vallis at hvallis@techweb.com. Find all of our reports at reports.informationweek.com
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The Cloud You Didnt Know You Had

Its downright shocking to think that almost three-quarters of the 511 business IT professionals responding to our InformationWeek 2012 State of Cloud Computing Survey are in the public cloud, planning to get there or considering cloud services, yet only 28% have scoped out the impact on their Internet-facing architectures. This is a major miss that can have a huge impact on your business. The first and most obvious issue is the impact on bandwidth, from user activity as well as integration traffic and any planned backups. Second is the question of redundancy, for your data lines as well as the cloud application itself. Obvious or not, these issues are going unresolved because of a lack of proper monitoring. Only 28% of respondents already in the cloud do what we consider proper internal oversight of their setups, including status monitoring, application tracking and throughput/performance monitoring. To be fair, most IT teams dont have a ton of experience designing their networks for inteFigure 1
Identifying Cloud Impact on Internet-Facing Architecture

Have you scoped out the potential impact of a cloud service on your Internet-facing architecture?
2012 2011
Yes
28% 26%
Not yet, but we plan to
32% 32%
Not yet, but we will before adopting any new services
2012 InformationWeek Cloud ROI Modeler

This Cloud vs. In-House investment modeler, a supplement to the InformationWeek 2012 State of Cloud Computing report, is intended to give some general guidelines when considering a cloud initiative. Data has been provided as a sample to be used as a starting point. All fields are unlocked and can be modified to suit your particular business needs.
28% 28%
No, and we have no plans to do so
4% 6%
Dont know
8% 8%
Base: 375 respondents in December 2011 and 272 in October 2010 using, planning to use or considering cloud computing services R4020112/12 Data: InformationWeek State of Cloud Computing Survey of business technology professionals at organizations with 50 or more employees
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grated connectivity with public cloud ser vices, whether SaaS, PaaS or IaaS; most of us just focus on getting the biggest pipes we can afford. And traditional network and system management platforms havent evolved to
support the complex traffic, application and environmental monitoring that youll need to truly understand a hybrid internal/external computing environment. For now, companies have to do some serious customization, comFebruary 2012 7
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bining existing suites, like those from CA, HP OpenView and IBM Tivoli with one or more of the tools offered by platform providers such as Amazon, Salesforce.com and VMware; we also recommend looking at the new breed of monitoring as a service tools from the likes of AppDynamics, LogicMonitor and New Relic. Speaking of monitoring, the 67% who say their companies are not yet making use of a public cloud service may be in for a rude awakening. Cloud apps have a sneaky way of creeping into an enterprise. Box.net claims more than 5 million users from 60,000 businessesvery likely including yours. And dont just blame the rank and file. Your IT staff is likely guilty of spinning up a few GoGrid virtual servers or an Amazon instance here and there. Its nothing to be ashamed of, but ignorance isnt going to be an excuse if Dropbox gets hit with a major breach and you find out that a saleswoman put an unencrypted spreadsheet containing customer information in her file share. Its time to find out exactly how much cloud you already have. The audit needs to start
Figure 2
Monitoring Cloud-Based App Performance

Do you actively monitor performance of your cloud-based applications?
2012 2011
Yes; our own basic monitoring (up/down)
24% 20%
Yes; our own advanced monitoring (application and transaction throughput monitoring)
28% 16%
Yes; vendor-provided basic monitoring
19% 21%
Yes; vendor-provided advanced monitoring (application and transaction throughput monitoring)
5% 6%
No; no formal monitoring is in use
24% 37%
Base: 166 respondents in December 2011 and 125 in October 2010 using cloud computing services R4020112/15 Data: InformationWeek State of Cloud Computing Survey of business technology professionals at organizations with 50 or more employees
with some good old-fashioned log file analyR sis of your inbound and outbound traffic. It should be fairly easy to identify usage and track it back to the individual or department. We recommend this versus asking if anyones done an end run around IT. Not only
does such an audit help close the loop on rogue projects, it gives your team hands-on experience building out monitoring and performance tracking. This is a critical step, especially for larger enterprises. Once you have a true picture of whats in use, you can deterFebruary 2012 8
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mine whats already been agreed to. If a department or group has opted into a vendors standard offering, its likely it just signed the contract and accepted stock SLA terms.
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Figure 3
Cloud SLAs
How do you create your SLA agreements with cloud providers?
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Clouds Role in BC/DR Strategy

These days, automatically replicating and archiving data to an offsite provider is as simple as plugging in a network storage appliance and filling out a few Web screensand recovery is about as easy and transparent. Backing up applications isnt quite so straightforward, though pairing internal virtualized apps with cloud-based VMs allows even small enterprises to achieve seamless recovery to world-class facilities with nearinstantaneous failover, without breaking the bank. By Kurt Marko
Report ID: R3271111
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These days, automatically replicating and archiving data to an off-site provider is as simple as plugging in a network storage appliance and filling out a few Web screensand recovery is about as easy and transparent. Backing up applications isnt quite so straightforward, though pairing internal virtualized apps with cloud-based VMs allows even small enterprises to achieve seamless recovery to world-class facilities with near instantaneous failover, without breaking the bank.
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The Reality of SLAs Cloud service-level agreements are the equivalent of a speeding ticket. Many people claim theyve beaten a ticket, but in reality, most of us get exactly whats coming to us. While 71% of respondents say they review the general vendor agreement and then negotiate terms, only 11% provide a template that providers must conform to. Fifteen percent are honest enough to admit accepting terms as is. Larger organizations can turn contracts over to their vilified (but secretly adored) contracts departments and let them battle providers. However, the vast majority of cloud SLAs are set, and were forced to either accept or negotiate the providers terms. The reality is that only the largest enterprises will be able to negotiate terms; we discuss how to get the best cloud SLA in more
Other Provide them with a template they must conform to
3% 11%
71%
Review their general agreement, then negotiate terms
15%
Accept their terms as is
R4020112/7 Base: 166 respondents using cloud computing services Data: InformationWeek 2012 State of Cloud Computing Survey of 511 business technology professionals at organizations with 50 or more employees, December 2011
depth here and here. RBut even giants like the federal government have to bend a bit, like in the case of the General Services Administrations recent email contract. The language of the request for proposal originally required data centers located in the continental United States only; it was
modified partway through the bidding process to allow any location that met the security requirements of the bid. Google, which has data centers worldwide, was eventually awarded the contract, and 17,000 GSA users have migrated so far, but the debate over data center location continues.
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Even if you do negotiate service-level concessions, the question then becomes, What do you get if theres an outage? When Microsoft had its big outages last year with Office 365, which included downed email, customers got a paltry 33% refund on their monthly service fees. Dig out the cost of downtime calculator from your last business continuity plan exercise and see if that would cover lost revenue. Not quite. It comes down to this: No public cloud vendor will ever agree to the same SLAs that you can create No public cloud vendor will in-house, the legendary fiveever agree to the same SLAs nines. A hosting provider like AT&T or Rackspace might that you can create in-house, match that for a specific ser the legendary five-nines. vice or hosted data center, but youll never get such an agreement on end-to-end connectivity. Nobody can guarantee uptime in the public, or even in a hybrid, cloud. Say it, breathe it, live it. There is a downtime reality you wont be able to control. While most IT organizations accept this as common
Impact Assessment: Cloud Computing

Impact to IT Organization Benefit
GG G G G Introduce a whole new platform option that can bring speed, flexibility, and potential cost savings to almost every element of the organization
Risk
GG G G G Requires a serious look at the basic vision of
your IT group. Challenges everything from security framework to staffing plans. Its easy to bury your head and ignore the big picture but youll have to address eventually
G G G G G Big potential of simply adding more junk
Business Organization
G G G G G Brings all of the same benefits that IT gets,
plus some potentially more advanced applications particularly as it relates to newer end user computing
that people cant handle. Needs the business to work in lock step with IT to make sure data flows seamlessly between all systems lest you lose your users
G G G G G Long term total cost and the potential of
Business Competitiveness
G G G G G Faster ramp up, more scalability, and lower
up-front costs have businesses drooling
building silos that someone else controls should make everyone pause
Bottom Line: GG G G G GG G G G Cloud as a computing is a valid option every organization needs to put into its planning. Simply ignoring it leaves you open to shadow IT that goes around you anyway. Adopting without a bigger framework that includes investments in interoperability, security and long term management of the platform is a sure way to blow another golden opportunity.
sense, its amazing we dont do a better job educating our business users. Time Warner and scores of other sites had problems last year related to Juniper switches and faulty firmware. This caused immense pain for scores of people who work at home and undoubtedly called IT in a huff.
This is where monitoring and tracking really become critical. IT always got the blame for any technology failure before cloud computing, and incorporating outside services has the potential to exacerbate the situation. There were outages last year from almost every big providerMicrosoft, Amazon, VMFebruary 2012 10
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ware, even Research In Motion. The calls go to you, not them. Proactive monitoring is the only way to ensure that your team knows whats going on before the phone rings. How to Make Cloud Soup Given that most IT teams today support a mishmash of applications, operating systems and hardware platforms, its no surprise that the majority of respondents have multiple cloud providers. Even organizations that embrace all Oracle or all IBM find it difficult to use their anointed vendor 100% of the time, especially when it comes to email, mobility and productivity applications. Respondents are fairly split over whether they favor a good partner fit or platform consistency; 29% select based primarily on the end product, regardless of who the provider is, while 27% value having a manageable set of vendors. Most, 44%, opt for a balanced weighting between the two. Regardless of your preference, you still have an integration challenge to overcome. Weve been able to manage data integration inter-
Figure 4
Number of Cloud Providers Used

Regardless of the number of different platforms and options, how many actual cloud providers do you use (e.g., Salesforce, Google, Oracle, GoGrid)?
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27%
91%
five or fewer cloud service providers.
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More than 10 6 to 10
4% 5%
64%
2 to 5
say their companies use
nally through standard plug-ins, custom code or by just letting users pull data together via R4020112_CloudComputing_chart 4 business intelligence or data warehousing apps. Sharing data among internal applications, however, is quite a bit different from making public cloud apps play welland yet we seem to treat these challenges the same
way, with an astounding 47% writing custom code to integrate services with internal applications (see Figure 5). That hub-and-spoke approach could end up crippling your network. Lets say that your company uses SaaS-based CRM, project management, hosted email and marketing platFebruary 2012 11
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5 Steps to Building A Private Cloud

Virtualization, automation and orchestration are the keys to making your IT infrastructure a business enabler rather than a cost centertheyll help you drive new initiatives through innovation and rapid service deployment. In this report, we lay out a staged approach to achieving this architecture. By Joe Onisick
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Virtualization, automation and orchestration are the keys to Register making your IT infrastructure a Previous Next business enabler rather than a cost center--they'll help you drive Next Previous new initiatives through innovation and rapid service deployNext Previous ment. In this report, we lay out a staged approach to achieving Next Previous this architecture.
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forms. All data is synced back to the internal accounting and ERP systems via custom code. Not only have you increased your inbound traffic fivefold, youre stuck supporting five custom integration points and often having users wait a day for updates. Integration as a service continues to evolve as a compelling alternative. Upstarts like Jitterbit and SnapLogic compete with larger vendors, including IBM and Informatica, that have built out their portfolios internally (Informatica) or by acquisition (IBM bought Cast Iron). While only 9% of cloud-using respondents leverage these systems today, they should be a core part of your cloud adoption strategy, especially when it comes to maintaining links and managing the growing amount of data residing off-site. These integration vendors are a natural outgrowth of the industry. Cloud vendors have to provide connectivity to end clients, but they have no incentive to work together. Its a natural fit for pure connectivity vendors. While the function of a Jitterbit or IBM Cast Iron may start with data integration
Figure 5
Integrating Cloud Applications

How do you integrate your different cloud and SaaS applications?
Custom coding directly to our internal system using each vendors API
47%
Leverage an internal integration platform
14%
Leverage a traditional VAN for data integration
10%
Leverage a cloud-based integration platform
9%
Other
11%
Dont know
27%
R4020112/3 Note: Multiple responses allowed Base: 166 respondents using cloud computing services Data: InformationWeek 2012 State of Cloud Computing Survey of 511 business technology professionals at organizations with 50 or more employees, December 2011
R4020112_CloudComputing_chart 3 today, we can see this role expanding to data analysis and enterprise search. If youre thinking you might just wait until new cloud standards are ratified by some agnostic committee, remember that IT standards groups move so slowly, theyre actually mocked by the U.N. Security Council. We dont think cloud stan-
dards effortswhether the Cloud Security Alliance, Cloud Standards Customer Council, DMTF, Open Data Center Alliance, Oasis TOSCA, or Bubbas Cloud API Shackwill be any different. Integration aside, theres also the somewhat touchy question of how to manage
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end user access to disparate services. While Microsoft Active Directory tends to dominate internal network access, theres a mishmash of authentication schemas in the cloud. Enterprise IdM (identity management) systems have a lot of catching up to do, especially when you look at the huge range of configuration possibilities related to the cloud. As we discuss in our recent IdM research report, cloud-based IdM and federation vendors seek to negate the need to manage and configure a vendors IdM system to run on your network. Rather, the idea is that you grant the vendor access to integrate your user directory to its IdM system; the provider then connects out to various integration points, such as your Active Directory or LDAP store. The enterprise single sign-on space has long been dominated by a mix of large and niche players, like CA, IBM and Oracle and ActivIdentity and Imprivata. These vendors are now playing catch-up to manage services such as those from Amazon, Google, Microsoft, Oracle and Salesforce. Likewise, a host
Figure 6
Cloud Provider Preference

Which of the following best describes your preference when it comes to cloud providers?
Provider consistency; having a manageable set of providers is a top priority and a major factor in the decision
27%
44% 29%
Balanced; we weigh the platform details and provider roughly the same
Platform fit; selection is based primarily on the end product regardless of who the provider is
R4020112/6 Base: 240 respondents using or planning to use cloud computing Data: InformationWeek 2012 State of Cloud Computing Survey of 511 business technology professionals at organizations with 50 or more employees, December 2011
of third-party SSO and IdM options are availR4020112_CloudComputing_chart Okta, able from the likes of Apere, OneLogin,6 Ping Identity and Symplified that either started as SaaS/cloud apps or were quickly retooled to capture mindshare. Its a big field that will only get bigger as VMware, Symantec and others join the fray.
A Healthy Helping of Worry Security has dominated respondents list of cloud concerns for the last several years, and that is essentially unchanged. Recent highprofile breaches not only continue to shine a light on the problem but may also be a contributor to the big jump we saw in responFebruary 2012 13
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dents who say cloud providers are riskier to work with compared with traditional outNext Previous sourcers or third parties. Its interesting that worries about cloud features and vendor lock-in have declined, in some cases fairly significantly. But we have no doubt that the inDownload ability of public cloud vendors to quell security concerns is a serious drag on their business. It also doesnt surprise Scott Matsumoto, principal consultant at the security testing firm Cigital. A lot of security profesSubscribe sionals just dont get cloud, says Matsumoto. Security A lot of security professionals teams tend to focus on infrajust dont get cloud. structure and architectural seScott Matsumoto, Cigital curity as the core part of their model. They have to naturally give that up as part of a cloud implementation. Theres an inherent lack of control associated with it that many just cant come to grips with. But he also realizes that infosec teams do get overruled or bypassed. He advises devising a standard audit approach that evaluates the vendors application suite and underlying
Figure 7
Cloud Services Concerns

When thinking about risks related to using cloud services, what are your top concerns?
2012 2011
51% 51%
48% 51%
Unauthorized access to or leak of our proprietary information
Unauthorized access to or leak of our customers information
48% 50%
Business viability of provider; risk company will fail
Integration of cloud data with our internal systems
Business continuity and DR readiness of provider
31% 33%
Features and general maturity of technology
Security defects in the technology itself
29%
Application and system performance
26% 27%
22%
28%
21%
15%
Vendor lock-in
12%
17%
February 2012 14
R4020112/9 Note: Three responses allowed Base: 511 respondents in December 2011 and 399 in October 2010 Data: InformationWeek State of Cloud Computing Survey of business technology professionals at organizations with 50 or more employees
technologies, so youre prepared for requests. R4020112_CloudComputing_chart 9 Organizations need to be able to expand their security frameworks to incorporate the
N/A
different risks and benefits that come with all the variants of cloud computing, he says. They just cant say no.
Other
4% 5%
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believe theres less risk in using a cloud provider than in using other thirdparty providers, unchanged from our 2011
Can You Go All In? You cant say no, but for all but the very smallest shops, youre not going 100% public cloud, either. Were always intrigued with the plucky few with this goal, though. In our 2012 survey, 4% of respondents say that, in 24 months, they expect 75% or more of their IT services to be delivered from the cloud. Sounds nice. Use Chrome laptops. Always be connected. Never worry about backup. Be free of IT. Is it feasible? Not likely, especially if you have an office with 100 or more users. Imagine the bandwidth requirements if all transactions, Office documents, email, backups, antivirus scans, heck, even printing had to go out over the wire, then back in. Even all in suites like NetSuite and SAP lack the ability to offer integrated Office documents. Remember, a major draw of the cloud is the lower upfront costs and perceived long-term cost savings. We say perceived because things arent that simple. Taking even one user all in with a true enterprise design gets pricey pretty quick, as we show in our table.
Figure 8
Weighing the Risks

When comparing cloud service providers with traditional outsourcers and third-party suppliers, do you believe these risks are...?
2012 2011
Greater with cloud providers
44% 38%
About the same
39% 44%
Lower with cloud providers
6% 6%
Dont know
11% 12%
Base: 511 respondents in December 2011 and 399 in October 2010 R4020112/10 Data: InformationWeek State of Cloud Computing Survey of business technology professionals at organizations with 50 or more employees
Three Points on a Path R4020112_CloudComputing_chart 10 Cloud computing is at an interesting pointdefinitely here to stay, but with growing pains still ahead. Many early adopters we spoke with are now grappling with the monitoring, management and integration requirements they somehow ignored during the honeymoon phase. The cloud has brought
much higher prices and lower customer service, says an infrastructure lead for a federal agency. However, since we outsourced, we cannot bring the functions back in-house. The 40% of respondents still in the planning or evaluation stages have a chance to avoid these pitfalls. Unfortunately, many seem to be ignoring the pioneers and slipping into the
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same traps that come with the promise of a quick implementation and a low up-front cost (see our Cloud ROI Modeler). Of the 27% still on the sidelines, our take is that some only think they dont have public cloud services in use by employees, others dont see a need. Everyones selling it, but I have yet to find a reason to replace what we have, one respondent says. We have secure remote access to our data anywhere in the world. Then there are the zealots. There will always be a the cloud is evil tea party-like fringe, but weve noticed that the percentage of respondents who fall into this category has dwindled to a loud and angry minority, unable to force everyone else to change and destined to fall in with the factions that hate Microsoft, Apple, open source, Oracle, Cisco you name it. If youre still on the sidelines, pay close attention to those who are blazing this trail. Talk to peers. Early adopters are pushing vendors to continuously drive down costs and improve functionality, and theyll inevitably make mistakes you can learn from. Three ar-
Figure 9
Future Degree of Cloud Use

Looking ahead 24 months, what percentage of your IT services do you predict will be delivered from the cloud?
2012 2011
75% or more; IT is a four-letter word to us
4% 2%
50% to 74%; if it can be outsourced, were looking to do it
11% 14%
25% to 49%; our core business isnt IT and were happy to use outside services
18% 17%
10% to 24%; some tasks are better done by others
29% 30%
1% to 9%; very limited usage
32% 29%
None, we hate the cloud
6% 8%
eas in particular to watch: R4020112_CloudComputing_chart 16 >> Be realistic about IT capital budgets. Theyll likely never return to prerecession levels; virtualization and cloud computing have
changed that forever. So your approach must move to more of an opex focus, as we discussed in our recent report on the morphing IT budget. >> Understanding what your current
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capabilities are in terms of your teams and existing platforms is a critical first Next Previous step. This will help you identify gaps and establish a base set of requirements that encourages cloud use on your terms. Yes, we said encourage. Download >> Figure out a rational cloud-approval procedure. Cloud never goes through the governance process, says one enterprise systems architect. Finance only cares about capital projects, so they just slip around the side. Subscribe This is a major gap that we see in multiple industries. IT needs Flexibility, speed to market to be looped in, and that and lower cost always means putting in place a streamlined, nonpunitive determine the success of a process for business units. Its new technology. highly likely you have multiple cloud instances running already. IaaS, SaaS, PaaS, storage, testing, backupsomebody has already gone rogue. Get a handle on the amount of usage, identify festering security or performance problems, and lay out guidelines so people will actually approach IT early on.
Figure 10
Use of Cloud Computing Services

What are your organizations plans for cloud computing?
2012 2011
Were receiving services today from a cloud provider
33% 31%
Were planning to use services from a cloud provider within the next 12 months
14% 14%
Were considering using services from a cloud provider
26% 23%
We have no plans to use services from a cloud
27% 32%
The elements of a cloud policy are fairly R4020112_CloudComputing_chart 1 straightforward: Establish baseline security requirements, integration guidelines and standard service levels everyone can understand. Offer monitoring and management options as a core part of the provisioning process. Long term, flexibility, speed to market and lower cost always determine the success of a
new technology. Public cloud services represent a continuation of that evolution at the application, platform and infrastructure levels. IT needs to position itself as the enabler of a hybrid cloud option, with both internal and external systems playing a role in enabling true service-oriented IT. Just make sure the public cloud becomes part of the core solution and not just a leap of faith.
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an you go all in? The concept of leaping headlong into the cloud is always kicked around, but is it realistic? Any enterprise would still need its investment in network infrastructure, cabling, printing, let alone large datasets that require single user access, like AutoCAD. Its also important to note that there are some major gaps, particularly when it comes to finding suitable applications for manufacturing, distribution and other specialty apps. We took a scenario of a pure office worker with no required access to external resources that couldnt be placed in the cloud. We gave two starting points, one Google-based and one Microsoft-based, to provide some interesting annual costs (see chart, right). Note: We added in a backup 4G data plan and a voice-over-IP plan since this is truly a cloud user who could never be without access to data. We also added access to Box.net since any
Sample Configuration 1: Google-Based Google Chrome laptop with 3G access VoIP Web solution (access and voice mail) Google enterprise email and app Box.net access NetSuite ERP GoToMeeting Additional 4G data plan Supplemental data backup service
Sample Configuration 2: Microsoft-Based $639 Annualized 3-year cost of laptop with hardware/software $708 Office 365 (with Office Suite, Exchange and VoIP) $50 Box.net access $180 VoIP Web voice access $667 $288 $180 $588 $780 $588 $240 $600 $36 Per user $3,264
$1,000 Salesforce.com $588 WebEx $600 Intuit accounting/finance $36 Additional 4G data plan for backup Supplemental data backup service Per user $3,765
Note: Users can mix and match cloud and SaaS options between the two samples based upon their application preferences. pure cloud player will eventually have to share outside with someone who doesnt allow access to Google Docs or Office 365. Standard vendor quantity prices were used as reference. These costs dont include any calculations related to moving your custom databases and apps to a hosted environment, or costs to provide virtualized desktops for legacy apps. Plus, youll still need a network within each building for high-speed Web access and printing.
February 2012 18
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APPENDIX
Figure 11
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Cloud Providers in Use

Which of the following types of providers are currently being used by your organization?
2012 2011
SaaS providers
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57% 56%
Virtualization technology providers
56% 61%
Platform providers
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42% 35%
Infrastructure providers
27% 21%
Other
11% 16%
Note: Multiple responses allowed Base: 166 respondents in December 2011 and 125 in October 2010 using cloud computing services Data: InformationWeek State of Cloud Computing Survey of business technology professionals
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Figure 12
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Planned Cloud Provider Use

Which of the following types of providers is your organization most likely to begin using within the next 12 months?
2012 2011
Virtualization technology providers
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Platform providers
48% 40% 42% 42%

SaaS providers
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Infrastructure providers
36% 31% 26% 38%

Other
14% 16%
Note: Multiple responses allowed R4020112/5 Base: 240 respondents in December 2011 and 147 in October 2010 using or planning to use cloud computing Data: InformationWeek State of Cloud Computing Survey of business technology professionals at organizations with 50 or more employees
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Figure 13
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Replace or Fire a Cloud Provider?

Have you ever had to replace or fire a cloud or SaaS provider?
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Yes
14%
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86%
No
February 2012 21
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Figure 14
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Greatest Performance Inhibitor

What do you believe is, or would be, the biggest bottleneck for performance of cloud-based applications?
2012 2011
Our own Internet bandwidth and connectivity
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Actual application and system design of vendors application
31% 31% 27% 29%
FAST FACT
Overall Internet traffic
31%
our 2011 survey.
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Cloud vendors Internet connectivity
23% 25% 12% 8%

Other
say their companies own Internet bandwidth is the obstacle to performance of cloud-based apps, the same percentage as in
2% 2%
Dont know
5% 5%
Base: 375 respondents in December 2011 and 272 in October 2010 using, planning to use or considering cloud computing services R4020112/11 Data: InformationWeek State of Cloud Computing Survey of business technology professionals at organizations with 50 or more employees
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Figure 15
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Cloud-Based App Performance

How would you rate the general performance of any cloud-based applications in use in your organization?
2012 2011
Better than same app hosted in-house
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Equal to in-house app
27% 26% 54% 56%

Subpar compared with in-house app
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19% 18%
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Figure 16
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Change in Performance
How has the performance of cloud-based applications in use in your organization changed over the last year?
2012 2011
Gotten better
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About the same
44% 45% 52% 54%

Gotten worse
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4% 1%
February 2012 24
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Figure 17
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Job Title
Which of the following best describes your job title?
IT director/manager
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IT executive management (C-level/VP)
31% 10%
Other
10% 4% 5% 4%
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Consultant Line-of-business management Non-IT executive management (C-level/VP)
36%
IT/IS staff
Data: InformationWeek 2012 State of Cloud Computing Survey of 511 business technology professionals at organizations with 50 or more employees, December 2011
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Figure 18
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Company Revenue
Which of the following dollar ranges includes the annual revenue of your entire organization?
$6 million to $49.9 million
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Less than $6 million
15% 4%
11% 14%
Dont know/decline to say
9% 11%
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8% 17% 11%
Government/nonprofit
$1 billion to $4.9 billion $5 billion or more

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Figure 19
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Industry
What is your organizations primary industry?
12%
11%
12%
Download
Consulting and business services
7%
Subscribe
Construction/engineering
Manufacturing/industrial, noncomputer
6%
10%
Telecommunications/ISPs
5%
Logistics/transportation
Media/entertainment
Healthcare/medical
Retail/e-commerce
Financial services
3%
Food/beverage
Government
2%
2%
2%
3%
4%
2%
Electronics
IT vendors
Education
Nonprofit
2%
Utilities
2%
R4020112/19
Other
15%
February 2012 27
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Figure 20
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Company Size
Approximately how many employees are in your organization?
50-99
100-499
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10,000 or more
3%
26%
28%
9%
500-999
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10%
5,000-9,999
24%
1,000-4,999
R4020112/20
February 2012 28
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2012 State of Cloud Computing

500 IT pros weighed in on their use of public

Report ID: R4020212

2012 State of Cloud Computing

2012 State of Cloud Computing

Michael Healey InformationWeek Reports

2012 InformationWeek, Reproduction Prohibited

2012 State of Cloud Computing

2012 State of Cloud Computing

2012 State of Cloud Computing

2012 State of Cloud Computing

The Cloud You Didnt Know You Had

Identifying Cloud Impact on Internet-Facing Architecture

2012 InformationWeek Cloud ROI Modeler

2012 State of Cloud Computing

Monitoring Cloud-Based App Performance

Yes; our own basic monitoring (up/down)

2012 State of Cloud Computing

Clouds Role in BC/DR Strategy

Report ID: R3271111

Other Provide them with a template they must conform to

Review their general agreement, then negotiate terms

2012 State of Cloud Computing

Impact Assessment: Cloud Computing

G G G G G Brings all of the same benefits that IT gets,

G G G G G Faster ramp up, more scalability, and lower

up-front costs have businesses drooling

2012 State of Cloud Computing

Number of Cloud Providers Used

say their companies use

2012 State of Cloud Computing

5 Steps to Building A Private Cloud

Report ID: S3981211

Integrating Cloud Applications

2012 State of Cloud Computing

Cloud Provider Preference

2012 State of Cloud Computing

Cloud Services Concerns

Unauthorized access to or leak of our proprietary information

Unauthorized access to or leak of our customers information

Business viability of provider; risk company will fail

Integration of cloud data with our internal systems

Business continuity and DR readiness of provider

Features and general maturity of technology

Security defects in the technology itself

Application and system performance

2012 State of Cloud Computing

Weighing the Risks

Greater with cloud providers

2012 State of Cloud Computing

Future Degree of Cloud Use

75% or more; IT is a four-letter word to us

2012 State of Cloud Computing

Use of Cloud Computing Services

Were receiving services today from a cloud provider

2012 State of Cloud Computing

The Big Leap

Like This Report?

2012 State of Cloud Computing

Cloud Providers in Use

2012 State of Cloud Computing