The global economic slowdown has forced companies of all sizes and industries to take a hard look at their costs from a cloud computing and infrastructure perspective. It is being acknowledged, now more than ever, that legacy IT infrastructures simply cannot handle the computing needs of an interconnected, remote-first world. In response, more and more companies are moving from on-prem to cloud computing services – and the trend shows no sign of slowing down.
Let’s take a look at the numbers. In 2020 alone, 61% of companies moved to the Cloud, out of a need to build secure remote-first infrastructures and keep business going during the pandemic. Cloud spending that year was $140 billion, which went up to $191.7 billion in 2021. And the benefits are already coming in – over 78% of small and medium businesses report cost reductions after shifting to the cloud, while 80% of companies report seeing operational improvements. Small wonder, then, that there are currently over 3.6 billion active cloud users around the world – 47% of the world’s population.
Overall, according to Gartner, more than 85% of companies will have adopted a cloud-first approach by 2025. In this piece, we take a brief look at what migrating to the cloud will look like for companies in 2023 and beyond.
The cloud computing landscape is constantly evolving, in terms of the way companies are engaging with the cloud as well as the kinds of applications it is being used for. Here are some key cloud computing trends we can expect to see.
Cloud computing trends to keep in mind for 2023
- Multi-cloud environments – Different cloud vendors have different benefits, and going forward, companies are likely to work with a range of vendors to leverage the benefits of each rather than locking into just one. This keeps things flexible, and also guards against too much reliance on a single cloud ecosystem, which can become a problem if the cloud vendor alters or reduces the services it offers.
- Edge computing – A relatively new trend is the shift away from centralized data centers towards processing data on IoT devices or “on the edge” of the network. This is significant because networks and devices are becoming increasingly interconnected, and by processing data near its source, more data can be processed faster and thus be applied in real-time.
- Security – While moving to the cloud brings manifold opportunities, it also exposes company data to more cybersecurity threats. Cloud computing vendors will continue to invest in better encryption measures and vulnerability testing so that their clients’ data is secure at all times.
- AI/ML services – The application of AI and machine learning offer considerably higher scope for automation and granular decision-making across industries. From CRMs to payroll systems to ecommerce platforms, AI is changing the face of operations everywhere – and cloud platforms that offer AI/ML as part of their suite of offerings will gain favour with ambitious up-and-coming brands that may not have the resources to set up an in-house AI infrastructure.
- Low-code/no-code services – Tools that allow users to build applications and solve problems without coding knowledge are becoming increasingly popular. Several cloud vendors are offering low-code/no-code platforms as part of their service suite, and this is only going to increase beyond 2023.
Benefits of moving to the cloud
With cloud computing, companies no longer need to buy and own their computing infrastructure. They can purchase it “as a service” from cloud vendors like AWS who have their own data servers and storage centers. This keeps things flexible and low-cost, allowing companies to focus on applying cloud computing to create new solutions rather than worrying about IT infrastructure. Some of the core advantages of shifting to the cloud include:
- On-demand pricing – With the cloud, costs become a direct factor of operational expenditure. Companies can plan and track their infrastructure spending down to each gigabyte of data sent or received, which greatly reduces capital expenditure as compared to the on-prem model.
- Ease of scalability – Companies that have moved to the cloud are no longer constrained by the limits of their in-house infrastructure. They can add as much capacity as their growth calls for, paying only a service fee. Conversely, if they need to scale back, they can do so whenever they need to and pay a reduced fee.
- Ideal for data analytics – Being on the cloud isn’t just useful for data storage; it also enables data to be refined, processed, and converted into insights at lighting-fast speed via AI algorithms. This is particularly beneficial for industries with high data computing needs, such as driverless cars or genome sequencing, where large volumes of data from multiple pools need to be processed for insights.
Ideal for companies of all sizes – Startups can quickly prototype and set up their IT infrastructure with a cloud service like AWS. In addition, SMBs can continuously optimize and adjust their infrastructure costs as their business scales up or down. For emerging companies looking to be nimble about seizing new opportunities, the cloud offers a degree of flexibility and cost-effectiveness unlike any other solution.
How companies can make the most of their cloud migration
Moving to the cloud cannot be done just because everyone else is doing it. Every company should have a clear ‘why’ motivating their shift – which in turn will inform the nature and scope of cloud computing services to invest in. Leading cloud providers like AWS offer an optimal balance in terms of reliability, pricing, setup support, ongoing maintenance, scalability and security, which is why we recommend it for those new to the cloud. In addition, the company should invest in training its team members to manage cloud resources effectively.
Ultimately, companies exist to delight their customers. By leveraging the power of cloud computing along with their own innovative approach to solving industry challenges, startups and SMBs can accomplish this faster and more effectively.
