When thinking about the future of cloud computing industry, there is one word that comes to mind – innovation. Cloud technology has matured hugely over the past year. While we do still talk about “cloud” as some abstract technology choice, this year the conversation will get subtler.
There may be a big shift away from explaining the basics and debating cost-benefits to exploring amazing things this type of computing allows us to do. Cloud computing won’t be about dry definitions and reduction of IT bottlenecks but about innovation, agility, and tailoring cloud architectures to better address challenges and enable new ideas.
Here are some ways in which cloud computing is set to change in the near future, and hence change the future of tech industry.
Adoption will rocket
Cloud computing has already transformed the way many businesses, and indeed whole industries, operate. With recent stats showing 86% of CISO’s (Chief Information Security Officers) now saying their organizations are moving to the cloud, this transformation will continue across many more businesses. Traditional companies and industries may well make the largest strides towards cloud in 2015.
The idea that it’s only startups and tech companies that can benefit from cloud technology is long gone. Cloud computing is modern computing and for many, it is now essential to business. The high level benefits are so widely understood that only few companies can afford to ignore it.
In addition, many more businesses will recognize the opportunity to aggressively compete or entirely disrupt their industries by leveraging cloud technology. By essentially becoming software companies at their core, the most innovative companies in industries as diverse as retail, music, and even transportation, have been able to revolutionize the way they do business.
Price wars will intensify
There is much talk in the cloud industry about the so-called ‘race to zero’. With so much competition in the cloud industry today, providers are essentially locked in a continuous price-slashing war, even as storage limits increase.
This price war will drive innovation throughout the whole industry, for a number of reasons. It will cause the cloud services providers to innovate to differentiate, rather than compete on price alone. This race has to end somewhere: presumably zero or somewhere close. In the meantime, cost savings from the IaaS and PaaS (Infrastructure as a Service and Platform as a Service respectively) get passed down the cloud chain to the software vendors. These vendors in turn pass savings onto their customers, ultimately making cloud solutions more compelling for the end user and cheaper for new SaaS players to get up and running. This, along with a reduction in upfront fees from some of the major cloud providers, should mean greater competition and innovation in the SaaS market too.
There is a potential downside of cloud computing though. Only the biggest companies can afford to take part in these kinds of price wars, which could deter new players from entering the IaaS space and eventually stifle competition and innovation.
Speed of software innovation will increase
As even the largest organizations gain experience in cloud computing, we’ll see it applied in more sophisticated ways to address more complex challenges. We’ve moved beyond the purely experimental, bleeding edge phase and now have established best practices for building cloud software, deploying it, designing and maintaining cloud environments.This is driving an unprecedented pace of software innovation.
We can set up a new cloud environment in minutes. We can scale it up or down with a few mouse clicks. We can iterate frequently and deliver new solutions quickly, so we are better able to react to customer feedback and anticipate changing market conditions. We can experiment more and fail fast. This agility is making the customer feedback loop much shorter.
Data-driven insight will increase
Cloud computing has given us the capacity to manage and process huge amounts of data. It has also provided the means for a new generation of cloud-based analytic tools to help make sense of it all.
Becoming a data-driven enterprise will be essential in order to compete in the years to come. Data drives innovation. The ability to analyze your marketplace, to spot trends and predict what lies ahead is key to knowing where to apply innovation efforts in the first place. As organizations becoming increasingly confident with storing data in the cloud, their ability to innovate will also increase.