AUSSIE CLOUD ADOPTION IS RISING RAPIDLY; COMPANIES OPTING FOR HYBRID PATH

SYDNEY – 27 October, 2009 - The number of Australian businesses planning for or testing cloud computing services has increased dramatically, according to new research commissioned by Avanade. The report findings reveal that cloud computing has evolved from being a ‘buzzword’ to a legitimate concept for IT delivery – with the number of respondents who say they are beginning to embrace cloud computing increasing nearly three-fold since January 2009.

This study is the second worldwide survey of cloud computing adoption, conducted by an independent market research firm. It polled more than 500 C-Level and IT executives in 16 countries in North America, Europe and Asia.

The research shows the gap is closing between the companies with cloud computing plans and trials, and companies with no plans to adopt it. At the time of the first study, commissioned in January 2009, the majority of companies (56 percent) had no plans to adopt cloud-based systems. In the most recent report however, that number had decreased to 32 percent – indicating a growing acceptance of cloud computing in the enterprise. 

Other key findings in the September 2009 survey show:

         64 percent of respondents regard cloud as a strategic investment while 36 percent view it as a cost-saving measure for their company

         More than half of respondents (52 percent) have opted for a mix of cloud-based and internal IT (on-premise) systems

         The vast majority (63 percent) of respondents say the economy has either helped (21 percent) their efforts or has had no effect (42 percent) on their efforts to implement cloud computing

According to Jeyan Jeevaratnam, Vice President, Australia and New Zealand, Avanade: “There has been an astonishing shift in attitudes and adoption of cloud computing over the past nine months and the acceleration in momentum we’re seeing shows no sign of slowing. With many enterprises seeking to incorporate cloud-based systems into business operations, it’s clear that companies are becoming more comfortable with cloud computing as a viable technology.”

Hybrid deployments seen as the way forward

While companies are now beginning to embrace the concept of cloud-based systems, there are still barriers to the sole use of cloud services in large organisations. The survey reveals that security issues, cost and a lack of an immediate need are the leading reasons for those not using cloud computing, while those currently using cloud-based systems say that they have experienced a ‘steep learning curve for IT staff ‘ (39 percent).

Given these concerns, there are very few reports of full migrations to the cloud, with the survey revealing that more than half of companies (52 percent) are adopting a hybrid approach of using cloud and internally owned systems. This compares with 16 percent of organisations using a combination of systems nine months earlier.

 “The move to cloud is not an all or nothing proposition. It provides great benefits, but not everything is meant to live in the cloud. Companies will need to make smart choices about where it might be best applied -- it’s about using the cloud in a way that is consistent with business strategy and the needs of the organisation. That being the case, as companies increasingly look to dip their toes into cloud, we see the future of cloud-based systems lying in a combination or hybrid approach of cloud and internally based systems,” said Jeevaratnam.

While companies are just now becoming comfortable with the concept of cloud computing, 64 percent of respondents report they are already embracing the adoption of Software-as-a-Service (SaaS) applications, one aspect of cloud computing. Other key SaaS findings include:

         The majority of respondents (52 percent) have been using SaaS for a year or less

         Although the technology may be new to most users, nearly one third of users (30 percent) report using three or more SaaS providers

          SaaS users would prefer to deploy SaaS applications delivered internally versus from a third party service provider

         97 percent of SaaS users view their experience as largely ‘successful’

         67 percent of respondents are looking to increase their SaaS usage in the next year