NFV Applications NEWS

There's Gold in the Cloud Shift, But Are Businesses Ready to Mine?

By Steve Anderson April 07, 2016

Businesses are making rapid moves to cloud-based technology. This is done for a host of reasons, starting with a desire to get access to more and better services and a nearly-equal desire to stay out of the huge expense that on-premises systems would require to produce the same services. A new look at this market from Technology Business Research shows that there's a lot of room for growth here, but it will take significant change from the businesses interested in getting in on the action.

The word from Technology Business Research notes that businesses are eager to lay claim to a chunk of this market, but in order to do so, are rapidly modifying currently available product lines to make it feasible. Legacy vendors are having a particularly rough time with this, particularly when compared with the vendors who went into the market directly to address cloud-based matters. Those software providers that also have hardware options on hand are also working to modify their approach in light of increasing cloud interest, using delivery models that are more flexible overall, and also focusing on the value of an integrated portfolio specifically designed to deliver the most in cloud function.

As noted by Meaghan McGrath, an analyst with Technology Business Research, vendors are putting their strongest foot forward. Vendors with hardware and software solutions are offering integrated product lines, and the smaller focused players work toward niche markets. It's a different approach based on the current strength in the field, and one that's allowing both sides to get the most out of what's currently on hand.

Interestingly, one gain is proving the direction of the market; applications software that's moving to a subscription basis is ahead of infrastructure management operations, owing mainly to simpler applications moving to the cloud rather than things like databases and “middleware technology.” License revenue is also on the decline, as the bring-your-own-license format means less forfeiture of license contracts. Subscriptions are gaining ground, and customers are increasingly in favor of technology models that allow users to adapt current infrastructure to accommodate new systems.

Businesses need to get the most out of currently-available systems, and if there's a way to retrofit these systems to accommodate current needs, then of course such a route will be taken unless it's more cost-effective to buy new. If the old material is breaking down frequently or not keeping up with what's needed, then it will almost certainly be replaced. With the shift to cloud, we're seeing vendors that were formerly hardware-focused deliver new hardware / software combinations, and we're seeing vendors that we've never seen before deliver strictly software.

Changing markets mean new opportunities, but opportunities seldom come without challenges. The shift to the cloud means a great opportunity for those businesses that can seize it, and being able to seize it means a change in the way business is done.  

Edited by Stefania Viscusi

Contributing Writer

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