On-premise IT holding steady around 65% of enterprise workloads – Highlights

barfing cloud.png

One of the more common questions I’ve had over the years is: “but, surely, everyone is just in the public cloud, right?” I remember having a non-productive debate with a room full of Forrester analysts back in about 2012 where they were going on and on about on-premise IT being dead. There was much talk about electricity outlets. To be fair, the analysts were somewhat split, but the public cloud folks were adamant. You can see this same sentiment from analysts (including, before around 2011, myself!) in things like how long it’s taken to write about private PaaS, e.g., the PaaS magic quadrant has only covered public PaaS since inception).

Along these lines, the Uptime Institute has some survey numbers out. Here’s some highlights:

Some 65% of enterprise workloads reside in enterprise owned and operated data centers—a number that has remained stable since 2014, the report found. Meanwhile, 22% of such workloads are deployed in colocation or multi-tenant data center providers, and 13% are deployed in the cloud, the survey found….

On-prem solutions remain dominant in the enterprise due to massive growth in business critical applications and data for digital transformation, Uptime Institute said
Public cloud workload penetration:
Some 95% of IT professionals said they had migrated critical applications and IT infrastructure to the cloud over the past year, according to another recent survey from SolarWinds.
Budgets:

That survey also found that nearly half of enterprises were still dedicating at least 70% of their yearly budget to traditional, on-premise applications, potentially pointing to growing demand for a hybrid infrastructure….

Nearly 75% of companies’ data center budgets increased or stayed consistent in 2017, compared to 2016, the survey found.

Metrics, KPIs, and what organizations are focusing on (uptime):

More than 90% of data center and IT professionals surveyed said they believe their corporate management is more concerned about outages now than they were a year ago. And while 90% of organizations conduct root cause analysis of an IT outage, only 60% said that they measure the cost of downtime as a business metric, the report found.

Demographics: “responses from more than 1,000 data center and IT professionals worldwide.”

Pretty much all Pivotal Cloud Foundry customers run “private cloud.” Many of them want to move to public cloud in a “multi-cloud” (I can’t make myself say “hybrid cloud”) fashion or mostly public cloud over the next 5 to ten years. That’s why we support all the popular public clouds. Most of them are doing plenty of things in public cloud now – though, not anywhere near “a whole lotta” – and there are of course, outliers.

This does bring up a nuanced but important point: I didn’t check out the types of workloads in the survey. I’d suspect that much of the on-premises workloads are packaged software. There’s no doubt plenty of custom written application run on-premises – even the majority of them per my experience with the Pivotal customer base. However, I’d still suspect that more custom written applications were running in the public cloud than other workloads. Just think of all the mobile apps and marketing apps out there.

Also, see some qualitative statements from CIO types.

So, the idea that it’s all public cloud in enterprise IT, thus far, is sort of like, you know: ¯_(ツ)_/¯

Building out the IoT backend at Ford

Predicting data storage requirements of 200PB by 2021 – growing from today’s 13PB – Ford chief exec Mark Fields said in a canned statement that the new bit barn “will increase the ability of Ford’s global data insights and analytics team to transform the customer experience, enable new mobility products and services, and help Ford operate more efficiently.”

Link

Rackspace positioning around cloud and OpenStack, from the CEO

Now that they don’t have to compete with AWS, they have an extra $300m floating around in the spreadsheets:

“Ultimately now it’s about how are we going to build a stronger company. If we don’t have to go spend $300 million a year in capital competing against Amazon, building computing storage and networking, where should we go put that? In things like managed cybersecurity and professional services,” said Rhodes.

On OpenStack, finding the product/market for for private cloud:

And what about OpenStack, the open-source cloud computing platform that Rackspace created with NASA?

“We thought the world wanted another alternative to public cloud,” said Rhodes. “What we are learning is the world doesn’t need another public cloud, so OpenStack is shifting form and going private cloud.”

Also, cameo from my former 451 colleague Carl Brooks.

Link

451: Container market to be $2.7B by 2020, from $762m in 2016

451-container-market-2017-01-09

451 Research estimated this week the application container segment reached a robust $762 million in 2016 and is forecast to grow at a 40-percent compound rate over the next four years to $2.7 billion.

And, on usage, from an April/May 2016 survey:

451 Research’s Voice of the Enterprise: Software-Defined Infrastructure Workloads and Key Projects survey conducted in April and May 2016 showed that of the roughly 25% of enterprises we surveyed who use containers, 34% were in broad implementation of production applications and 28% had begun initial implementation of production applications with containers.

I’m somewhat suspicious that there’s $762m in container software and services sales, but who knows, really?

I haven’t read through their entire cloud enabling technologies market sizing yet, from Dec 2016, (basically, private cloud software and services, any things used by *aaS vendors, not the actual public cloud services, which are another market) , which is more than just containers. That market is pegged at $23bn in 2016, going to $39bn in 2020:

2016 CET Market Monitor - Public Cloud vs. CET.png

More on 451’s blog.

Source: “Container Market Pegged at $2.7B by 2020”

On-prem still a big thing, Gartner survey

only 10% of organizations surveyed by Gartner are expected to close their on-premises data centers by 2018

Much of Pivotal’s business is on-premises, very much if it. However, most large organizations I talk with really want to get to much more public cloud as soon as possible. They look to Pivotal Cloud Foundry’s multi-cloud compatibility to help them down the line with that. For example, Home Depot is starting to move applications to Google Cloud.

Anyhow, most people outside of enterprise IY are surprised and a bit incredulous at how much “private cloud” there still is: ¯_(ツ)_/¯

Link

CloudBees launches certification and new private SaaS offering backed by Jenkins 2.0

2014, when the company pivoted away from its public PaaS offering to focus on Jenkins. That seems to have been the right move – headcount has grown from 60 to 164 since then, and revenue increased 150% year over year in 2015.

There’s pricing in there too and some notes on enterprise customers if you have 451 access.

Source: CloudBees launches certification and new private SaaS offering backed by Jenkins 2.0

Private cloud, still a thing

Round up of some recent private cloud surveys:

A comprehensive 451 Research report recently identified that hosted private clouds today accounted 25 per cent of budget for off-premises infrastructure spending and growing to 29 per cent in two years. Public cloud accounted for 17 per cent today and growing to 18 per cent in two years.

Private cloud has come to include “public private cloud,” hosted/dedicated gear.

Despite the howls of protest from public cloud evangelists who claim anything else to be a ‘false cloud,’ there is still real value — today — in companies bringing cloud-like ideas and practices inside their own data centers. Software like Eucalyptus, OpenStack, CloudStack and others offer ways to replicate some of the value offered by a public cloud such as AWS, Microsoft Azure, Google Compute Engine, or HP’s Helion. Run at scale, across the data centers of a large enterprise, the pool of available computing power can — and does — deliver real business value. At least until the company is ready to properly embrace public cloud, which is where most IT will eventually end up.

Nice piece from Paul Miller on HP’s OpenStack appliance. I could care less about the HP bashing: what I like is the point he makes around “small clouds.”

Amazon built my private cloud

Some good stuff from the latest from the $600m private cloud the CIA got from Amazon, including:

Meanwhile, Wolfe also acknowledged lingering industry criticism of its 2013 decision to award the $600 million cloud computing contract to AWS, essentially putting all the agency’s eggs in one basket. IBM unsuccessfully protested the cloud contract award to AWS. The CIA official defended the contract award this week, saying it provided AWS with nothing more than concrete pads and power to build the CIA cloud datacenters. AWS delivered all other cloud infrastructure and was up and running in less than 18 months, he added.

The scary thing would be if Amazon can build a $100m private cloud…a $10m one…then things get weird for vendors who are trying to achieve asymmetric competition with Amazon by hiding in private cloud land.

Also some fun anecdotes on resistance to change.