connecting services to make hybrid the new cloud foundation

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T EC H N O LO G Y B U S I N ES S R ES EAR C H , I N C .

TBR’s Cloud Program Hybrid Cloud Customer Insights

Technology Business Research Webinar Series

Feb. 6, 2014

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2 TBR Quarterly Webinar Series | 2.6.14 | www.tbri.com | ©2014 Technology Business Research Inc.

Cloud Business Research Highlights and Outlook: Hybrid Cloud Customer Insights

Allan Krans Senior Analyst, Software and Cloud Practice Email: [email protected]

Twitter: @allankrans

mailto:[email protected]

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TBR Cloud Program — Portfolio Product Descriptions

Customer and Competitor Reports: TBR cloud customer reports provide primary research-based insights into purchasing behavior, vendor adoption, satisfaction and demand across multiple cloud offerings and professional services segments.

Benchmarks: TBR’s benchmark reports provide analysis through qualitative and metric-based comparisons of key vendors in a market segment. Cloud data models are included with the benchmarks; this TBR research and analysis is built from the ground up based on 15-plus years of vendor-centric financial models.

Vendor Reports: Reports analyzing vendors’ cloud businesses cover all relevant segments and track performance across cloud-driven metrics including operating expenses, operating profit, headcount breakouts and geographic breakouts.

TBR Cloud Research Overview

Cloud

Benchmarks

Cloud

Business

Reports

Cloud

Customer

Research

Tracks

TBR


Cloud

Benchmarks

Public Cloud

Benchmark

Managed Private &

Professional Services

Cloud Benchmark

Cloud

Business

Reports

Accenture Amazon Atos Capgemini Cognizant CSC Dell

Deloitte Fujitsu Google HP IBM Infosys Microsoft

Oracle Rackspace Salesforce SAP ServiceNow Verizon Tata

Wipro Workday *Plans in place for additional vendors

Cloud Components

Benchmark

Cloud

Customer

Research

Tracks

TBR Cloud Program — Portfolio Product Overview

Private Cloud

Customer and

Competitor Report

Hybrid Cloud

Customer and

Competitor Report

Cloud Prof. Services

Customer and

Competitor Report

Topical Cloud Reports: 2013 reports included Cloud Security and Orchestration

TBR Cloud Research Overview

TBR


TBR Annual Cloud Customer Sampling Plan 2,200 surveys annually

Each report track for two reports per year: • Private Cloud: 650/year • Cloud Professional Services: 900/year • Hybrid Cloud: 650/year

TBR’s cloud customer research program contacts buyers at enterprises across the world for private cloud, hybrid cloud and professional services

Project Approach: Survey Methodology

N. America: 1,000 • United States • Firms >500 employees

Europe: 700 • United Kingdom • Germany • France • Firms >250 employees

Asia Pacific: 500 • India • China • Firms >250

employees

TBR


CLBQ Research Highlights:

Private Cloud Customer Report

TBR


Hybrid will become the new foundation for cloud service adoption as integrations become more standardized than custom Hybrid Cloud Migration

Although the direct integration opportunity is $7 billion, hybrid cloud will deliver the ability for customers to consume public and private clouds for more workloads and at greater scale.

Customers are planning the shift to hybrid environments but are still using largely custom connections between cloud resources.

Authenticity is required to capitalize on the hybrid opportunity and convert custom integrators to standardized approaches. Customers first seek cloud expertise before vendor relationship and price.

Executive Summary

Opportunity

Customer Landscape

Competitive Landscape

TBR


The $7 billion hybrid cloud opportunity is embedded at the intersection of public and private cloud markets

Executive Summary: Customer Landscape

2014 Hybrid Cloud Integration Opportunity

$67 Billion $40 Billion $7 Billion

Projected 2014 hybrid cloud integration

market opportunity

Public Cloud Market

Private Cloud Market

24% Public — Public Integration

$1.7 Billion

49% Public — Private Integration

$3.4 Billion

27% Private — Private Integration

$1.9 Billion SOURCE: TBR

TBR


Vendor Opportunity: Opportunity and Cloud Expenditures

Cloud adopters increasingly consider hybrid cloud integration an integral part of cloud budget allocation

Average Enterprise 2013 Cloud

Budget $17.5M

2013 Professional

Services Expenditures

2013 Public Cloud

Expenditures $3.4M

2013 Worldwide Hybrid Cloud Integration Expenditures (n = 1,100)

2013 Public and Hybrid

Cloud Integration

Expenditures $5.4M

2013 Private Cloud

Expenditures

2013 Hybrid Cloud

Integration Expenditures

$2M

TBR


Budgets vary by region, reflecting the varied state of cloud service adoption across the globe

Hybrid Cloud Expenditures by Geography

Vendor Opportunity: Opportunity and Cloud Expenditures

Hybrid Cloud: Regional Overview

• Although average hybrid cloud budgets vary by geography, aspirations to elevate individual cloud benefits across broader cloud environments are creating opportunities for cloud vendors and professional services providers.

• Prebuilt hybrid clouds as well as the integration of past cloud purchases are driving vendor opportunities across geographies.

• Recognizing the various approaches to achieving the hybrid cloud end-state by region will best position vendors for success.

$4,600

$3,100

$4,200

$0 $1,000 $2,000 $3,000 $4,000 $5,000

20

13

20

13

20

13

N. A

me

rica

(n=

13

2)

Euro

pe

(n=

10

0)

AP

AC

(n=

73

)

Average Expenditures (in $ thousands)

AVERAGE HYBRID CLOUD EXPENDITURES BY REGION

SOURCE: TBR

TBR

TBR



The next year is critical for vendors to capture hybrid cloud opportunity, as the wave of new customer investment will peak during 2014

Cloud Adopters’ Cloud Consideration

Although private and public clouds dominate the cloud marketplace, the percentage of consideration and anticipated purchase of the cloud environments drops drastically over the next two years. Hybrid cloud will be the primary cloud environment evaluated and purchased over the next two years, amplifying the need for integrated hybrid solutions and messaging of vendors’ hybrid cloud capabilities.

Evaluating and will purchase within the

next 12 months

Evaluating and will purchase after the

next 12 months

Public Cloud 19% 8%

Private Cloud 16% 8%

Hybrid Cloud 24% 12% n = 325; Percentages indicate percent of respondents.

“There is an awful sensation among some of the smaller groups in any business to try to build their own [cloud], and a hybrid solution appears to be the easiest way forward. It’s like putting your foot in the water and seeing how you can go with it.” — IT Architect, $1 billion to $4.9 billion, Media/ Publishing, Germany

TBR



The expectation for hybrid is that vendors can deliver standardization across the environment while maintaining the core benefits of cloud

Reasons for Migrating to Hybrid Cloud

• Improved operational efficiency • Ability to scale resources up and

down as needed • Reduction in total cost of ownership • Increased standardization of

processes across workloads

Top perceived benefits of hybrid cloud

Discrete benefits of individual cloud workloads

Unique value of hybrid cloud to elevate discrete benefits across holistic cloud environments

Vendor Strategy Messaging and demonstrating the integration capabilities of solutions (both cloud and services) will best position vendors to capture and maintain accounts as customers’ clouds evolve from point cloud solutions to integrated hybrid environments.

TBR



Hybrid approaches and needs vary significantly, requiring a service-led approach in APAC and more structured approach in N. America

Routes to Hybrid Cloud

Hybrid cloud purchase decisions in the Americas and EMEA are premeditated, with hybrid the intended end-state for cloud environments.

APAC adopters are arriving at hybrid models out of necessity,

integrating prior cloud purchases after the fact.

How vendors can succeed:

Americas and EMEA: Message integration capabilities of cloud

solutions to deliver desired hybrid end-state.

APAC: Lead with education and integration services

to help optimize cloud solutions.

Overall Hybrid Adoption rate = 22.5% (n = 2,001)

N. America Hybrid Cloud Adoption Rate = 21.7%

EMEA Hybrid Cloud Adoption Rate = 23.9%

APAC Hybrid Cloud Adoption Rate = 22.9%

TBR


Average Number of Integration Methods

Utilized Top Methods Utilized

2

1.9

3.2

Executive Summary: Opportunity

Early use of custom integrations in APAC and EMEA will eventually give way to prebuilt solutions currently utilized in North America

How Customers are Arriving at Hybrid Cloud

Hybrid Integration Methods

Custom integrations

Cloud integrations through a professional services firm

Prebuilt cloud vendor integrations

Cloud integrations through ISV

Third-party delivered hybrid cloud (through ISV, MSP or professional services firm)

TBR


0%

20%

40%

60%

80%

100%

WORKLOADS MIGRATED TO HYBRID CLOUD

2013 2014 EST.

TBR

SOURCE: TBR


Building on initial workload transitions, customers will accelerate hybrid adoption for core, mission-critical applications in 2014

Hybrid Cloud Workload Migration

While Storage and Test & Dev. will lead all workloads in hybrid migration in 2014, the most rapid migration of workloads to hybrid cloud will be across BI, HR and ERP workloads.

+39% +38% +36%

Messaging of integration services capabilities and delivering preintegrated workloads for hybrid cloud will position vendors for success in 2014.

TBR


Executive Summary: Competitive Landscape

Demonstrating a breadth of cloud-specific knowledge and capabilities can disrupt the traditional IT vendor landscape

Vendor Consideration

Cloud knowledge and complete line of cloud capabilities

With customers seeking proven cloud know-how and complete solutions, vendors cannot rely on existing relationships and market reputation to carry them into the hybrid cloud space — demonstrating tech leadership will be the key differentiator in the hybrid cloud market.

Value and price

Ease of doing business

Existing vendor relationships

SOURCE: REUTERS

TBR


Questions?

TBR


Allan Krans Senior Analyst, TBR’s Software & Cloud Practice Email: [email protected] Twitter: @allankrans Telephone: 603.758.1819

Hybrid Cloud Customer Insights: Webinar Contact Information

James McIlroy Vice President of Sales Email: [email protected] Telephone: 603.929.1166

Twitter: @TBRinc SlideShare: www.slideshare.net/TBR_Market_Insight YouTube: www.youtube.com/user/TBRIChannel



https://twitter.com/TBRinc

https://twitter.com/TBRinc

http://www.slideshare.net/TBR_Market_Insight

http://www.youtube.com/user/TBRIChannel

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Cloud Vendor Reports (Cloud Business Quarterly)

Benchmarks (Benchmark XLS data is also available)

• Accenture Cloud* • Amazon Web Services* • Atos Cloud* • Capgemini Cloud* • Cognizant Cloud* • CSC Cloud* • Dell Cloud* • Deloitte Cloud* • Fujitsu Cloud* • Google Cloud* • HP Cloud* • IBM Cloud* • Infosys Cloud* • Microsoft Cloud* • Oracle Cloud* • Rackspace* • Salesforce.com • SAP Cloud* • ServiceNow* • TCS Cloud* • Verizon Cloud* • Wipro Cloud* • Workday

Public Cloud Benchmark The public cloud program compares and analyzes the strategies, results and drivers of 50 key vendors in the public cloud segment across Software as a Service, Platform as a Service and Infrastructure as a Service. Managed Private & Professional Services Cloud Benchmark* The managed private cloud and professional services program compares and analyzes the strategies, results and drivers of 29 key vendors in the managed private cloud and professional services market across Business Process as a Service, Software as a Service, Platform as a Service, Infrastructure as a Service, cloud consulting, cloud SI and cloud ADM. Cloud Components Benchmark* The cloud components program compares and analyzes the strategies, results and drivers of 12 key vendors that sell the building blocks of software and hardware used to construct public and private clouds. Note: There are also three semiannual cloud adoption studies and cloud topic reports (Cloud Security is available now and Cloud Orchestration is upcoming).

Syndicated Research Coverage

TBR Cloud Practice Syndicated Coverage

*Semiannual Report

About Us Technology Business Research, Inc. is a leading independent technology market research and consulting firm specializing in the business and financial analyses of hardware, software, professional services, telecom and enterprise network vendors, and operators.

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