Cloud Computing Could Fuel Economic Recovery, Shore Up IT Budgets, Researchers Say

Two separate studies of IT business decision-makers points to the cloud as driver of IT savings. Confidence in cloud technology building but security concerns persist among enterprise customers.

Cloud computing will allow business decision makers to pare IT budgets by up to 40 percent, help companies regain ground lost during the current economic slide and lower infrastructure costs, according to separate studies commissioned by Savvis Inc., a St. Louis, MO-based cloud infrastructure provider and Mimecast, a U.K.-based company offering software-as-a-service (SaaS) solutions for enterprise email management.

In the Savvis study, some 68 percent of the survey participants, which encompassed 658 C-level executives and other IT decision makers for large and mid-sized businesses based in the U.S., U.K. and Singapore, pegged cloud computing as a catalyst to assist companies attempting to regroup from the global economic downturn.

Accordingly, about three-fourths of the 500 U.S. and U.K. IT professionals in the Mimecast study said that using cloud services has lowered IT infrastructure costs.

A notable finding of the Mimecast study is that significant differences exist between users and non-users of cloud services not only surrounding well-stated issues such as security but also concerning benefits associated with cloud adoption. For example, more than half of the respondents in the Mimecast survey believe that the advantages of the cloud delivery model are overstated.

The Savvis survey found that businesses constrained by belt-tightened budgets believe that cloud computing can deliver more punch for less money than traditional solutions. Survey participants from business and the public sector predicted that cloud use will decrease IT budgets on average by 15 percent and perhaps as much as 40 percent.

“Flexibility and pay-as-you-go elasticity are driving many of our clients toward cloud computing,” said Bryan Doerr, Savvis chief technology officer.

Still, both the Savvis and Mimecast studies revealed that despite growing confidence in the cloud, security concerns persist. In the Savvis survey, more than 50 percent of participants not using cloud services pointed to security of sensitive data as the reason.

To bridge the gap in security issues, three-fourths of Savvis respondent said that they want cloud providers to fully manage security but allow configuration changes from the customer.

The Mimecast study revealed that 51 percent of respondents are using some form of cloud-based services with a relatively high degree of satisfaction. Nearly three-fourths of respondents in the Mimecast study said that the cloud has both alleviated pressure on internal IT resources and delivered an improved end user experience.

Studies support cloud computing’s market momentum

The Savvis data showed that 96 percent of IT decision makers believe cloud technology to be enterprise ready now and 70 percent either are already using, or plan to employ, an enterprise-level cloud service within the next two years.

In addition, the Mimecast survey indicated that two-thirds of businesses are considering adopting cloud-based applications.

Among cloud offerings, email, security and storage are the most popular services, with more than 60 percent of businesses using cloud-based email and more than 50 percent accessing cloud-based security or storage services, according to the Mimecast data.

“It is great to see that cloud computing has now been embraced by the majority of organizations,” said Peter Bauer, Mimecast chief executive and co-founder.

“The fact that more than 50 percent of businesses are now using cloud-based applications, with two thirds currently considering adopting them, is hugely encouraging for the industry and a clear indication that IT is increasingly willing to innovate in order to get better value for money, increased reliability and greater control of their data,” Bauer said.

Vanson Bourne, a U.K.-based technology researcher conducted the Savvis study, while Loudhouse Research, also a U.K. based research house, collected data for Mimecast.

Both Savvis and Mimecast initiated the cloud studies last year and, in some instances, compared this year’s data to results from the inaugural reports.

Savvis recently reported $221.8 million in revenue and a $13.2 million loss for its fiscal second quarter ended June 30, a flat sales performance both on a sequential quarterly and year-over-year basis, and more than double the loss posted from the year earlier period.

Mimecast landed some $21 million in venture capital funding early this year, tagging the money for research and development on the company’s cloud-based platform.

TAGS: cloud computing,cloud services,SaaS,Savvis,Mimecast



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