The Rush to the Cloud

In the most recent Cisco Global Cloud Index (2016-2021) white paper, Cisco predicts that nearly 94% of all computing will be conducted in the cloud by 2021.  Global cloud IP traffic will account for 95% of total data center traffic by 2021 and will grow in size to 20.6 zettabytes (one zettabyte contains one sextillion bytes).  As technology progresses, companies are finding themselves with more and more data to store and services to sell through the web.  This can only be expected to increase as data quality continues to rise and file sizes become larger.  To envision this, think about how much space a Blu-ray movie takes up compared to the same movie in DVD format.  This newer technology improves quality, but comes takes up more space.

The white paper also claims that the number of hyperscale datacenters will grow from 338 in 2016 to 628 by 2021.  Hyperscale datacenters are usually operated by large corporations, such as Apple, Google, and Amazon.  These datacenters are at least 10,000 square feet in size and contain at least 5,000 servers.  Hyperscale cloud operators must report earnings within the billions to qualify for this category. 

This trend indicates that more companies are recognizing the value and profit potential of building and offering public cloud offerings.  In fact, many large corporations mark having their own datacenter as a point of pride.  Certainly, it allows these companies to directly service their customers without relying on a competitor’s service.  Facebook for example maintains its own hyperspace datacenters partly because it competes with major cloud providers such as Google.  How could a company expect to rely on its competitor to host its data?

The Software as a Service (SaaS) deployment model continues to dominate with 75% of all cloud workloads falling into this category by 2021.  Compare this to 16% for Platform as a Service (PaaS) and 9% for Infrastructure as a Service (IaaS).  The SaaS cloud deployment model includes web applications such as public mail services (like Gmail), banking applications, and customer portals.  As more companies trend towards offering their customer services, this number can be expected to continue its trend. 

What is causing this huge shift into the cloud?

Companies are recognizing the advantages of cloud computing.  Cloud architecture allows companies to scale their resources in a cost efficient manner.  The traditional costs of hosting web applications would include the price of IT hardware, rent for a datacenter, security costs, personnel costs, and power.  It is very difficult to purchase only what is needed with these variables.  Often, companies would end up with too much hardware or processing power for their needs.  They might find that they require just a few extra gigabytes of additional storage, or that personnel changes were affecting the operation of their data center.  Small to mid-sized companies might not have the available capital to set up their own datacenter efficiently. 

With cloud computing, companies can purchase exactly what they need and no more.  They are able to scale their level of computing in direct proportion to their needs.  This is referred to as scalability.  Cloud service providers are also able to offer services at a cheaper cost compared to the benefits of a traditional datacenter because the costs of security, personnel, and utilities are mitigated by the number of clients. 

Cloud customers are also only charged for what they use.  This measured service approach is very attractive for companies with variable needs over time.  For example, a jewelry company with an online store might expect to do more business over Christmas and Valentine’s Day.  They would needs additional computing resources only during those periods and not throughout the rest of the year.  The company could quickly scale their level of service during those times.  This in the cloud industry is known as elasticity. 

The number of cloud services can only be expected to increase in the future.  Cloud deployments allow for global markets, direct customer interaction, scalability, and elasticity.  With so much data in cloud form, the importance of cloud security is at its highest point ever. 

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