2020 Tech Market Predictions
The beginning of every new year is a healthy time for businesses to survey the cloud landscape, reflect on the market outcomes from the previous year, and evaluate their business objectives for the next 12 months. Of course, the market is an ever-changing animal with variability at every turn, and the global economic outlook isn’t always favorable. Yet, when it comes to the cloud, there are many reasons to be optimistic. Many businesses will continue to rely on cloud services for their global operations and to manage a dispersed workforce. Microsoft has a host of product end-of-life deadlines on the slate for 2020, which will drive software upgrades for many companies, as will the continued aging of hardware and legacy infrastructure. Considering these factors, there is significant opportunity for rapid growth in the global cloud-services market.
Below, we explore five cloud-market predictions we expect to see come to fruition in 2020.
Cloud-to-cloud migrations will remain strong
The majority of BitTitan’s business is around cloud-to-cloud migrations. This doesn’t mean on-prem-to-cloud migrations are slowing down, but it does indicate that a substantial number of businesses are already in the cloud and migrating between cloud instances to find their most ideal digital environment. This trend will only continue.
Historically, the primary hurdles that kept organizations from moving to the cloud were concerns around security and reliability. But many organizations have since seen the enhanced security that the cloud can offer with effective strategies in place, which has led to increased confidence among businesses in relying on cloud services. Now the primary concern among users is vendor lock-in, which occurs when a customer is “locked-in” with their service provider and unable to switch to another vendor without being subjected to significant switching costs.
To address this concern, many businesses are employing a multi-cloud strategy, where they rely on multiple cloud providers for cloud services. This approach not only helps companies manage potential business risks, it also allows them to compare service offerings and leverage the most ideal options. A multi-cloud approach gives companies a sense of assurance and control. Given the many benefits, this approach will further drive cloud-to-cloud migrations.
SaaS will evolve
The continued adoption of cloud services leaves much opportunity for the growth and evolution of software as a service (SaaS) offerings. The cloud market is a $200 billion industry, yet overall IT spending is in the trillions, indicating that most of this spending is for On-Premises software and there is considerable room for digital transformation and optimization.
As companies look to further leverage cloud benefits, they will migrate more office-productivity workloads to the cloud, moving away from homegrown applications and adopting more turnkey solutions that are born in the cloud. The movement of workloads to the cloud will continue to accelerate, leading to significant growth in the SaaS area.
Microsoft and Google will outpace AWS in growth
Of the top three public-cloud providers, Amazon Web Services was the first to market and has since grown to capture the largest share of the cloud market, appealing to companies that want to provide “born in the cloud” services.
But in 2020, sustaining such massive growth won’t be realistic, and AWS will cede some of its market dominance to its public-cloud rivals. Microsoft Azure and Google Cloud Platform will outpace the growth of AWS and chip away at its overall market share. Microsoft has a solid foothold in the enterprise sector and has developed trust among these organizations with enabling the migration of legacy infrastructure environments. Microsoft Azure’s strong pedigree in this area gives it a unique advantage at chipping away at AWS’ market share. Alternatively, Google boasts technology that is streamlined and easy to use, offering a solution that may provide simplified management for end users. Google has also committed to investing more funding toward increasing the appeal of Google Cloud for enterprise organizations.
Containerization use will thrive
Growing at an annual market rate of 40 percent, containerization has achieved mainstream adoption and reshaped the approach toward application development and DevOps. Containerization is the process of bundling an application with all its files and libraries, allowing it to run across different environments. Its value propositions are numerous: Containerization accelerates development, improves quality, establishes reliability, eliminates points of failure, and reduces complexity from a deployment perspective. When moving to the cloud, Containers eliminate the cumbersome methods of manual configuration, instead employing automation to define and replicate an environment in a fraction of the time while minimizing the risk for error. They enable a significant reduction in cost, essentially “de-risking” a cloud migration. The significant value that containerization affords will ensure its utilization rates will continue to rise.
5G will augment global cloud services
Deployment of 5G technology is going global, as Ericsson Mobility predicts there will be 1 billion 5G subscriptions by 2023. This technology – which offers an array of benefits that include faster data transmission, lower latency and increased network capacity – will enable of level of connectivity that hasn’t yet been seen on a global scale. This will be similar to the introduction of broadband to replace dial-up internet services. The improved speed and reliability afforded by 5G will enhance cloud computing and allow for increased networking in underdeveloped economies. It will bring significant improvement to the world of cloud computing and create opportunity for innovation.
There is always unpredictability when it comes to forecasting the cloud-market landscape. By taking a proactive approach and anticipating what developments are on the horizon, businesses can prepare themselves for capitalizing on opportunities as they emerge. Continue looking forward to stay a step ahead of your competitors and keep your business operations humming along.
By Mark Kirstein