In this episode of our forecast series, we consider the evolving nature of the cloud across architecture, cost management and indeed lower levels of infrastructure. We asked our analysts Dana Hernandez, Ivan McPhee, Jon Collins, Whit Walters and William McKnight for their thoughts.
John: We are witnessing a maturing of architectural thinking, not just in cloud computing, but across the delivery of technologies. Keep in mind that what we know as the cloud is still only 25% of the total space – the other three quarters are on-premise or hosted in private data centers. It all has to work together as one imaginary platform, or at least the more accurate we can make it, the more efficient we can be.
While the key word may be “hybrid”, I expect to see a random shift from hybrid environments to hybrid by design – active decision making based on performance, cost and indeed areas of governance such as sovereignty. Cost management will continue to catalyze this trend, as demonstrated by FinOps.
Dana: FinOps is evolving and many companies are considering on-prem or moving workloads back from the cloud. At FinOpsX, companies looked at the combined costs of on-prem and cloud. Oracle has now joined the big three, Microsoft, Google and AWS, and it will be interesting to see who jumps in next.
John: Another example is repatriation, moving workloads out of the cloud and back on-premises.
William: Yes, repatriation is accelerating, but cloud providers can respond by 2025, likely through more competitive pricing and technical improvements that offer greater flexibility and security. We are still heavily moving to the Cloud and the repatriation may take several years to slow down.
White: The supplier’s reaction to the repatriation was interesting. For example, Oracle with Oracle Cloud Infrastructure (OCI) undercuts competitors with its pricing model, but there is skepticism – clients fear that Oracle may raise costs later due to licensing issues.
John: We’re also seeing past pure-play cloud providers move to embrace hybrid models, even if they probably wouldn’t say so out loud. On-premise cloud offering AWS Outposts, for example, can now work with on-premises storage from NetApp, and this type of partnership is likely to accelerate. I insist that “cloud” should be seen primarily as an architectural construct around dynamic provisioning and elastic scaling, and secondarily around who the provider is – I recognize that hosting companies can do a better job with resiliency. Organizations must put architecture first.
John: We’ll also see more cloud-native tools for managing these tasks. For example, on the SASE/SSE side, companies like Cato Networks are seeing success because people don’t want to install physical devices over the network. We also see this trend in the GDR with companies like Lumu Technologies, where security solutions are cloud-native rather than on-premises.
Cloud-native solutions like Cato Networks and Lumu Technologies have more pricing flexibility than those tied to hardware components. They will be better positioned to adjust pricing to drive adoption and growth than traditional on-premises solutions. Some vendors are exploring value-based pricing and considering factors such as the customer’s business value to tap into strategic accounts. Moving into the future can be an exciting shift.
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