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Cloud Infrastructure as a Service Market Update

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The U.S. Infrastructure as a Service (IaaS) market crossed the $3 billion mark in revenues for 2012, reflecting the increasing acceptance of the hosted, on-demand model for creating and delivering IT resources. In the seven years since the beginning of the cloud era, the market has finally emerged out of the early adopter stage, and is now in the early growth stages. Enterprises are still cautious about making a major commitment to the cloud, but more enterprises are trying out IaaS for more workloads than they did two years ago.

Why You Should Attend

- Learn about market trends driving IaaS adoption
- Gain insight into market revenue growth trends
- Understand the competitive landscape
- Learn what’s next in IaaS

Published in: Business, Technology
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Cloud Infrastructure as a Service Market Update

  1. 1. U.S. Cloud Infrastructure as a Service (IaaS) Market Update, 2013 Steady Growth Across all Segments Roopa Honnachari Program Manager – Business Communication Services June 19, 2013 © 2012 Frost & Sullivan. All rights reserved. This document contains highly confidential information and is the sole property of Frost & Sullivan. No part of it may be circulated, quoted, copied or otherwise reproduced without the written approval of Frost & Sullivan.
  2. 2. 2 Today’s Presenter •Industry Expertise includes – •Evolving Network Services ( MPLS and Carrier Ethernet), Data Center Services and Cloud Computing. •Specialization in analyzing Cloud implications on communication service provider business – emergence of ―everything as a service‖ model. •Functional expertise includes – •Providing strategic advice to companies on new market entry, new product/service development market share expansion and partnership development •Building market revenue forecasts, pricing forecasts, market share analysis and competitive analysis reports •11 years of market research, growth consulting, and technical marketing in the Telecom industry. Roopa Honnachari, Program Manager Frost & Sullivan
  3. 3. 3 Agenda • Defining Cloud IaaS • Why Should You Care About Cloud IaaS? • Market Drivers & Restraints • Market Revenue Evolution • Competitive Landscape • Key Takeaways
  4. 4. 4 Defining Cloud IaaS - What’s Included? Hosted, scalable data center infrastructure resources, available on-demand, without term or usage commitments, and charged via a pay-per-use model. IaaS comprises “raw” infrastructure, onto which users can build and deploy applications or workloads. Cloud Services Market IaaS Hosted Private Cloud Storage as a Service Computing as a Service Public Cloud PaaS SaaS Included in sizing Excluded from sizing
  5. 5. 5 Why Should you care about the Cloud IaaS market? MEASUREMENT NAME MEASUREMENT TREND Market Stage (Nascent, Growth, Mature) Growth — Market Revenue (2012) $3.02 B ▲ Base Year Market Growth Rate (2011 to 2012) 78.4% ▲ Compound Annual Growth Rate (CAGR), 2012-2016 60.0% — Customer Price Sensitivity (scale of 1 to 10, Low to High) 8 Number of Competitors 20+ ▲ Market Concentration (% of base year market controlled by top four competitors) 85% ▼
  6. 6. 6 Market Drivers • Decrease IT infrastructure costs • Cited by 55 percent of IT decision makers as a key driver for IaaS adoption • Support for business continuity and disaster recovery plans • Cited by 35 percent of IT decision makers as a key driver for IaaS adoption • Improve security and compliance profile • Cited by 25 percent of IT decision makers as a key driver for IaaS adoption • Reduce IT staff • Cited by 35 percent of IT decision makers as a key driver for IaaS adoption Source: 2012 Frost & Sullivan Cloud End User Survey. N=108
  7. 7. 7 Market Restraints • Concerns about application performance and reliability • Cited by 71 percent of respondents as a top restraint to cloud IaaS adoption • Unwillingness to recede control • Cited by 65 percent of respondents as a top restraint to cloud IaaS adoption • Concerns about security risks • Cited by 58 percent of respondents as a top restraint to cloud IaaS adoption • Concerns about regulatory compliance • Cited by 55 percent of respondents as a top restraint to cloud IaaS adoption Source: 2012 Frost & Sullivan Cloud End User Survey. N=108
  8. 8. 8 Market Revenue Trends - $ 3 Billion in 2012 Revenues Source: Frost & Sullivan 73% 27% 2012 Revenue breakdown by Compute vs. Storage Compute Storage 88% 12% 2012 Revenue breakdown by Public vs Hosted Private IaaS Public Hosted Private
  9. 9. 9 Competitive Landscape Amazon Web Services Rackspace Verizon/Terremark SAVVIS/CenturyLink Others Infrastructure as a Service Market: Market Share Analysis (U.S.), 2012 ―Others‖ category includes Microsoft, GoGrid, AT&T, SoftLayer, Windstream, NewServers, EMC, HP, IBM, Virtustream and several other small providers. Source: Frost & Sullivan
  10. 10. 10 Key Takeaways •IaaS adoption is growing, as enterprises increasingly turn to cloud-based IT model to reduce their capital expenditure. •The 2012 initiatives from leading cloud IaaS providers—to launch public cloud offerings and object-based storage offerings—are a testament to the fact that market demand for bare-metal IaaS continues to grow. •As enterprise-class IaaS services evolve, providers will take greater responsibility for security, compliance, backup and recovery, and application delivery—with the additional functionality either ―baked in‖ to their services or available as an option. •The future IT landscape will be a hybrid one, combining multiple cloud and traditional environments under the management of a single enterprise.
  11. 11. 11 Questions?
  12. 12. 12 Detailed TOC
  13. 13. 13 Your Feedback is Important to Us Growth Forecasts? Competitive Structure? Emerging Trends? Strategic Recommendations? Other? Please inform us by ―Rating‖ this presentation. What would you like to see from Frost & Sullivan?
  14. 14. 14 http://twitter.com/frost_sullivan Follow Frost & Sullivan on Facebook, LinkedIn, SlideShare, and Twitter http://www.facebook.com/FrostandSullivan http://www.linkedin.com/companies/4506 http://www.slideshare.net/FrostandSullivan
  15. 15. 15 For Additional Information Mireya Espinoza Corporate Communications Information & Communication Technologies (210) 247-3870 Mireya.espinoza@frost.com Roopashree (Roopa) Honnachari Program Manager, Business Communication Services - ICT Stratecast | Frost & Sullivan rshree@frost.com www.twitter.com/roopa_shree Lynda Stadtmueller Program Director | Cloud Computing Stratecast | Frost & Sullivan lynda.stadtmueller@frost.com Perry Somers, Director of Business Development, Stratecast | Frost & Sullivan psomers@frost.com P: 360.416.4982

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