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Cloud uptake in Australia soars as IaaS spending nears $1 billion

Cloud uptake in Australia soars as IaaS spending nears $1 billion

Majority of local CIOs plan to invest within the next 12 months

Australian enterprises are boosting usage and increasing spending on public cloud Infrastructure-as-a-Service (IaaS), according to new research from analyst firm, Telsyte.

Findings show that the local IaaS market is on track to grow by over 60 per cent reaching $621 million in 2016, and is forecast to reach $1.049 billion by 2020.

More than half of CIOs surveyed by Telsyte are planning to invest more in IaaS in the next 12 months.

The Telsyte Australian Infrastructure & Cloud Computing Market Study 2017 revealed local cloud uptake and spending is largely driven by changing ICT priorities, with IT infrastructure management becoming a top priority for Australian CIOs in the past 12 months, matching security for the first time.

Telsyte research shows big data analytics, storage, IoT, artificial intelligence and process digitisation are also driving the demand for cloud services as enterprises work towards modernising legacy systems and deploying new workloads.

Fewer than 10 per cent of organisations with more than 20 staff are not using any form of IaaS, indicating cloud services have quickly become a mainstream way of delivering IT infrastructure in Australia.

"The use of cloud aligns well with Australian enterprise ICT and business priorities; however, we still have some way to go before most organisations are using cloud to its full potential,” Telsyte senior analyst, Rodney Gedda, said.

Gedda said reliability and support factors far exceed cost for organisations when choosing a managed service provider (MSP) or pure cloud provider.

Cloud-first policies

According to Telsyte, more than 34 per cent of Australian enterprises now have a “cloud first” policy which is outweighing restrictions on cloud use, further driving uptake.

“As more global providers have extended their infrastructure to Australia, the data residency arguments for not using cloud have waned,” Gedda added.

According to research, selective cloud use is favoured by Australian CIOs over blanket off-premises adoption as applications like content management, backups, DR and software development are moved to pure clouds and managed service providers.

Private cloud use up

In addition to the growing appetite for public cloud services, Australian CIOs are investing in private cloud technology to enable more rapid service delivery.

With 78 per cent of enterprises building or planning to build a private cloud, Telsyte said it appears that private cloud is the preferred on-premises architecture for future deployments and infrastructure refresh programs.

Gedda added that with more virtualisation and acceptance of cloud automation and self-service, the platform is set for a hybrid cloud future where workloads are provisioned in response to business and application demands.

“There are many applications where it still makes business sense to deploy on private infrastructure, but having the agility to pick and choose the right cloud service for any application is the big promise of hybrid cloud," he said.

Additionally, Telsyte said CIOs are developing private clouds to respond to “business unit self-service”, which has risen to be second only to “more flexibility”.

Cloud containers and NaaS to drive innovation

According to Telsyte, operating system level virtualisation, or “containers”, is finding favour among enterprises with 70 per cent using or investigating their use.

Containers allow applications to be more portable across on-premises, MSP or pure cloud infrastructure.

The adoption of cloud networking, or Networking-as-a-Service (NaaS), is also growing alongside its server and storage counterparts with nearly 30 per cent of enterprises using some form for NaaS spanning from VPNs to firewalls and application acceleration.

“There are big opportunities for NaaS to improve operations and drive innovation as much of the complexity burden of network services is taken away from the customer,” Gedda added.

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Tags private cloudtelsytepublic cloudanalyst

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