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Cloud Services

Irony? Verizon Report Shows Cloud Biz Booming

In a classic case of bad timing, Verizon Enterprise Solutions today released its annual look at the state of enterprise cloud deployment and was able to report that not only are enterprises moving more applications into the cloud, they are using cloud to transform their businesses.

The report, which had been scheduled for release for some time, comes as speculation is mounting that Verizon is getting out of the cloud business in some ways by divesting Verizon Enterprise Solutions . Company officials, including everyone involved in this report, aren't commenting on those rumors. (See Verizon Enterprise Sale Would Signal Big Shift.)

The State of the Market, Enterprise Cloud 2016, which you can find here, is based on Verizon interviews with its cloud customers, commissioned research by the Harvard Business School and third-party research as well. It shows, not surprisingly, that 53% of enterprises use more than one cloud provider, 75% have adopted or plan to adopt a hybrid cloud strategy and 84% have increased their use of the cloud.

VES Cloud CTO Ryan Shuttleworth was able to comment on the more interesting findings of the report, such as:

  • Eighty-seven percent of cloud users have put at least one mission-critical application into the cloud. "Cloud has passed the smell test," he says. "Some customers are literally mandating the percentage of their applications that must move to the cloud."

    Where there are concerns about using public cloud, enterprises will instead use private clouds, with similar functionality, but in a more controlled environment.

  • Just adopting cloud isn't enough -- more than two thirds of survey respondents have used cloud to transform at least one business process. "Where people are starting to differentiate is where they start innovating with cloud," Shuttleworth says. "In the way they deliver applications or the types of applications and functionality they can deliver by taking advantage of inherent properties of the cloud. It's like this wave of generation of thinking that comes in and says, 'How can I embody big data technologies in the middle of my applications and make my applications really truly dynamic?' That is a different level of thinking and that is how you transform."

  • In fact, using cloud isn't an advantage anymore -- only 15% of those surveyed saw cloud as a competitive advantage compared with 77% a year ago. "It tends to be riskier for people who do nothing -- they get left behind," he says. "They wind up out of kilter with their peers. It's not about throwing away a whole business model to cloudify. But there are frontiers of what they are doing in marketing or analytics or mobility, where they will be experimenting with new ways of delivering technology, and that's where this kind of innovation and transformation of business model comes in."

    Verizon's survey shows those are the projects getting moved into the cloud -- the ones at the business transformation end of the scale.

  • Like telecom operators, enterprise cloud users face a skills shortage and that impacts what they do as well. "There is a skills land-grab. People are trying to grab the best talent to bring into their organizations to use the sorts of cloud-native technologies that cloud service providers can offer them," he says. "That is difficult space, and one of the things underlying some of the data is that skills acquisition is a challenge and remains a challenge when you are trying to look at the cutting edge of these technologies."

    Verizon can provide some of that to its customers through professional services contracts, and there is a growing acceptance of cloud-based technologies, such as Puppet, Chef and more, that just three years ago were considered cutting edge, Shuttleworth adds.

    — Carol Wilson, Editor-at-Large, Light Reading

  • cnwedit 11/12/2015 | 9:07:52 AM
    Re: Irony board Agreed and they admitted as much Tuesday.
    nasimson 11/12/2015 | 8:31:39 AM
    Re: Irony board I don't think Verizon will close its enterprise business. 4G, Cloud, IoT, Enterprise Apps .. are too big opportunities to miss at this time.
    cnwedit 11/10/2015 | 9:34:50 AM
    Re: Irony board No doubt. I'm waiting to hear what Verizon's CFO has to say this AM as to whether or not all this speculation is valid. 
    mendyk 11/10/2015 | 9:19:49 AM
    Irony board Verizon Enterprise -- wherever it ends up regarding ownership -- has a better shot at solid, sustainable success than an operator that circles the wagons to focus on what's left of its diminishing legacy business.
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