Primetime for Cloud and DevOps

The quarterly reporting season is upon us again. IBM and Microsoft have already announced impressive cloud growth figures in the last week, Microsoft showing 102% quarterly growth for Azure. In a couple of days AWS will share its latest quarterly earnings with analysts expecting to see significant revenue growth and improved margins.

Meanwhile Gartner is predicting that, this year, around $111billion dollars will be redirected to cloud away from traditional in-house IT spend. By 2020 they believe this figure will hit $216billion.

Over at PuppetLabs their annual State of DevOps report highlights how the highest performing IT organisations deploy 200 times more frequently than low performers, with 2,555 times faster lead times. This doesn’t come at the expense of quality either. The high performers have 3 times less change failures than the low performers and recover from failures 24 times faster.

This is telling us that these technological and cultural shifts are reaching a significant tipping point. If the early days of Cloud and DevOps were about test and development use cases, followed by wider deployment of non-essential applications, accompanied by huge infrastructure land grabs and price wars, we are now reaching the point at which Cloud is becoming the preferred platform for core applications.

In such an environment the battle for market share and margin has moved from Infrastructure-as-a-Service to managed platforms, offering a complete stack that attracts significant developer support. AWS, Microsoft and IBM have all busily been building out a broad suite of capabilities and platform services. At the same time they have re-doubled their marketing efforts aimed at winning over the development community. This is where added value and higher margins reside.

For the CIO Cloud now offers the opportunity to deliver real digital transformation and open up significant new business opportunities at a cost and speed unimaginable a few years ago. Legacy systems and in-house IT operations are not going to disappear overnight. However, Boeing shifting its aviation analytics apps to Microsoft Azure, Netflix closing down its in-house infrastructure in favour of AWS, and the U.S. Department of Defence awarding AWS a number of contracts prove that Cloud is definitely ready for prime time.

That isn’t the end of the story either. Just as we were getting comfortable thinking about and using containers, AWS starts talking about “serverless computing”. Their Lambda product, launched in late 2014, has a little way to go before it is truly serverless, but the direction and the implications are clear… infrastructure will be completely commoditised, if it isn’t already. The irony is that the platforms above the infrastructure are already looking quite proprietary despite using many OpenStack components.

We have said this before, but it warrants being restated. There will continue to be strong demand for data centre compute facilities. Areas not touched on in this article, like the Internet of Things, Machine Learning and Analytics, will all add to that demand. But, as a data centre operator, if your focus is solely on the infrastructure layer you are likely to end up in a very aggressive price sensitive environment where only the most efficient will survive. You need to have a platform strategy that enables you to co-exist and co-operate with the likes of AWS, IBM, Microsoft and Google, but that also helps you find and integrate with those niche players who will end up servicing specific verticals or applications.

This post first appeared on the old Cassini Reviews website.