Experimentation is giving way to specialization as more companies grow their comfort with cloud-based workloads. Yet there is room for growth and expansion.
Analysts estimate only 15% of IT spend is in the cloud, but 90% of businesses have implemented cloud systems. The mismatch highlights how much room there is for growth, especially around core app modernization.
Many trends of 2022 echo those of years past, but this year will lead to more specialized adoption as companies evolve and formalize their strategies.
Here are three trends that will shape cloud use in 2022:
Natural growth plateau
IaaS providers have comfortably relied on double-digit market growth, driven by initial service adoption. Though a land-and-expand strategy can fuel customer tool adoption and vendor buy-in, consolidation of infrastructure- and platform-based services is reshaping the market.
The lack of service separation could slow revenue down if vendors don't think about the innovation upside to consolidation and what they need to provide to customers to maintain growth, according to Milind Govekar, distinguished VP analyst at Gartner.
Industry has seen an example of stalled growth before — the enterprise resource planning market enjoyed popularity and widespread adoption, but then innovation died, Govekar said.
Monolithic ERP systems are cumbersome, making modernization difficult. While the technology became more composable, timing upgrades and modernization is an art.
IT is archaeological, with civilizations of applications buried under layers, which contribute to technical debt, Govekar said.
With smart adoption, companies can reduce technical debt by going cloud-native and using services, which will make way for innovation, he said. Any cloud provider who can support that will continue with their growth trajectories, at least for the next five years.
Maturity makes room for cloud cost optimization
Pandemic uncertainty led to more investment in technology, a trend set to continue this year. IT budgets are expected to jump 3.6%, the largest increase in a decade.
Concerns about how to manage technology spend coincide with investment and, as cloud bills grow, businesses are scrutinizing spend.
As cloud adoption evolves from a trial to concerted investment, businesses are looking at how to optimize their cloud spend, said Brian Adler, senior director of cloud market strategy at Flexera. More businesses are looking at savings plans, reserved instances and committed user discounts.
Hesitation surrounding long-term contractual commitment with the cloud is subsiding. In turn, business leaders are looking toward programmatic discounts, he said.
Multicloud strategies take the lead
Private, public or hybrid cloud has dominated industry at one time or another, with preferences shifting because of technology needs or security concerns. Multicloud strategies tap into multiple providers, aligning providers with workloads.
It's a shift away from gradual accumulation of cloud services, and into highly-controlled and strictly-planned adoption.
In Wells Fargo's case, Microsoft Azure is its primary public cloud provider, but it will also use Google Cloud for advanced workloads, including AI and data solutions.
In many cases, organizations are gearing toward single providers, but they're also concerned about becoming beholden to an individual market, said Dhaval Moogimane, partner, high tech and software at West Monroe.
Businesses are navigating cloud limitations, from service geography to support for edge analytics. If performance waffles with a primary provider, businesses will branch out to other organizations to support their computing needs.
Organizations are going to consolidate conditional transactions and workloads around a mainstay of big providers, but workload considerations could drive multiple vendor adoption, according to Moogimane.