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"Brutal" competition in IaaS causes market upheaval: Gartner

Brian Karlovsky | May 20, 2015
Australia set to spend US$341.7 million on infrastructure-as-a-Service this year, up 14.7 per cent

Gartner's 2015 CIO survey indicates that 83 percent of CIOs consider cloud IaaS as an infrastructure option, and 10 percent are already cloud-first with cloud IaaS as their default infrastructure choice. Cloud IaaS is now used for virtually all use cases that can be reasonably hosted on virtualised x86-based servers, according to Gartner.

"The most common use cases for cloud IaaS are development and testing environments; high-performance computing and batch processing; Internet-facing websites and web-based applications; and non-mission-critical internal business applications. An increasing number of organisations now also run mission-critical business applications on cloud IaaS," according to a statement. Leong said Cloud IaaS could now be used to run most workloads, although not every provider could run every type of workload well.

"Cloud IaaS is not a commodity," she said.

"Providers vary significantly in their features, performance, cost and business terms.

"Although in theory, cloud IaaS has very little lock-in, in truth, cloud IaaS is not merely a matter of hardware rental, but an entire data centre ecosystem as a service.

"The more you use its management capabilities, the more value you will receive from the offering, but the more you will be tied to that particular service offering." According to Gartner, organisations must learn to operate in two essential modes, known as bimodal IT, because they can't lose sight of the need to maintain IT operations while they innovate with new digital possibilities. Initially, most businesses adopt cloud IaaS for mode two: agile IT projects that may be peripheral to the organisation's IT needs, but may have a high business impact.

This affects sourcing: Mode two adoption is often business-led, driven by business managers who hold the budget, need greater agility and have shorter time frames than IT operations are able to accommodate. Over time, as a business becomes more comfortable with the use of cloud IaaS, it will be used in Mode 1, traditional IT projects as well, usually mirroring the past decade's adoption pattern of virtualisation in the data centre.

Many businesses, especially in the midmarket, will eventually migrate away from running their own data centres in favor of relying primarily on infrastructure in the cloud, according to Gartner.


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