Inside Advanced Scale Challenges|Friday, July 28, 2017
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AWS Lead Slips as Multi-Cloud Advances 

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New market intelligence emerges each week about the steady enterprise shift to the cloud as companies conclude they must upgrade their IT infrastructure to compete.

A "cloud transformation" study released this week by market analyst 451 Research found that 80 percent of the organizations it surveyed expect to overhaul IT operations over the next five years. Of those, 22 percent said they are adopting a "cloud first" approach as most consider their options for moving workloads to the public cloud. The shift also has shuffled the rankings among leading public cloud providers, the survey found, as companies seek to avoid dependence on a single vendor.

While infrastructure services are the fastest growing cloud model, the market researchers said respondents nevertheless gave cloud infrastructure service providers low marks for multi-cloud and hybrid cloud support as well as understanding their business requirements. "Those [infrastructure] service providers who position infrastructure and technological innovation alongside meeting business requirements will be best positioned to capitalize on this market opportunity," 451 Research analyst Melanie Posey noted.

That said, 55 percent of public cloud adopters said they went with Amazon Web Services (NASDAQ: AMZN), citing breadth of services and technical expertise. For the first time, 451 Research noted, AWS customer ratings slipped on the basis of "value for money/cost," a category now led by Google Cloud Platform.

Indeed, Google (NASDAQ: GOOGL) has been steadily expanded its cloud offerings to attract new public cloud customers and compete with AWS, including the addition of support for Microsoft database management server along with performance upgrades such as incorporating custom Xeon Skylake chips from Intel Corp. (NASDAQ: INTC) to its Google Compute Engine.

Meanwhile, IBM SoftLayer (NYSE: IBM) and Microsoft Azure rated highest in the category, "Understands my business," the researcher reported.

The survey also confirms the enterprise shift to a multi-cloud strategy in which companies divvy up workloads among different cloud providers. Microsoft (NASDAQ: MSFT) appears to be the main beneficiary, with Azure emerging as a "formidable competitor" to AWS, the cloud survey found. AWS remains respondents "most important" cloud provider at 39 percent, but the market researcher reported that Microsoft Azure is closing fast, up more than 20 percent from its previous survey as the top choice of nearly 35 percent of respondents.

Posey noted that the launch of Microsoft Azure Stack, scheduled for mid-2017, could further erode AWS dominance. The Azure extension is billed as enabling application upgrades across hybrid clouds, including application development using a set of Azure services and DevOps tools. The cloud service also can be run on-premises, Microsoft said.

Microsoft Azure also was the top choice of European customers (43.7 percent), leading AWS by more than 10 percentage points. "Microsoft’s efforts to address European customers’ data sovereignty concerns no doubt contributed to its elevated positioning in the region," 451 Research said.

The survey results were based on about 700 responses to a web survey of IT managers around the world.

About the author: George Leopold

George Leopold has written about science and technology for more than 25 years, focusing on electronics and aerospace technology. He previously served as Executive Editor for Electronic Engineering Times.

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