It’s Clouds Ahead for Providers and the Enterprise in 2016

Jim Poole

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2016 promises to be a banner year for cloud service providers, according to a recent PivotPoint blog post titled Service Providers’ Roadmap to More Enterprise Sales in 2016 and new research from IDG. PivotPoint is an IBM knowledge resource targeted at managed and cloud service providers (MSPs and CSPs). The post interprets the following results of a recent 2015 IDG Enterprise Cloud Computing Survey as good news for MSPs and CSPs as enterprises continue to embrace the cloud:

  • 72% of enterprises have at least one application or some computing infrastructure in the cloud. This is huge, up from 57% in 2012. Some examples of typical cloud initiatives include customer relationship management (CRM), application development and testing and disaster recovery.
  • 48% aim to use the cloud to replace on-premises legacy technology, 46% to speed deployment, 43% to lower total cost of ownership, 35% to save on CAPEX.
  • 25% of total 2016 IT budgets will be allocated to cloud computing.

There are still some remaining concerns and challenges, however.

  • 67% say security concerns are a top challenge to implementing their cloud strategy, specifically the risk of unauthorized access and data integrity and protection.
  • 43% say integration is a top challenge, including making information available to applications outside the cloud and preserving a uniform set of access privileges. 90% say that APIs are critical to their cloud integration plans.
  • 35% have concerns about the ability of cloud computing solutions to meet enterprise and/or industry standards. This is in addition to 30% that have concerns about information governance (eDiscovery and other information management requirements).

As the PivotPoint post highlights, all this cloud activity means lots of opportunity for MSPs and CSPs, which can provide the expertise enterprises need to integrate the cloud with their existing legacy, home-grown and often isolated systems. The opportunity for providers is significant, as the majority of enterprises are expected to invest an average of $2.87 million each in the cloud in the next year. Providers can also help chief information officers pull together and present evidence of lower total cost of ownership based on the cloud.

Equinix and its Interconnection Oriented Architecture™ can help both providers and enterprises address these concerns, including security, speed of deployment, integration and reduced CAPEX ̶ not to mention performance.

Speed of deployment comes from extending the enterprise network to a Performance Hub in any of Equinix’s more than 100 global colocation centers, which provide direct, proximate, high-speed interconnections to more than 500 cloud providers, including major players Amazon Web Services, Microsoft Azure, Office 365, Google Cloud Platform, SoftLayer and Oracle Cloud. The Equinix Cloud Exchange allows enterprises to connect at lightning speed to multiple Infrastructure-as-a-Service, Platform-as-a-Service and Software-as-a-Service providers through a single network port.

Security comes from direct, proximate, dedicated connections inside highly secured colocation centers. Compare this to connecting over the hundreds or thousands of miles across the “wild west” of the public Internet.

Ease of integration comes through the Cloud Exchange portal and a raft of APIs for simplifying provisioning and managing cloud connections to multiple cloud services and networks. APIs allow sellers to build a single interface to the Cloud Exchange and cloud buyers to ramp up multiple cloud services quickly.

Reduced CAPEX comes from ease and speed of deployment, easy integration and lower-cost proximate connections, both to local colocation centers and colocated cloud and network providers, which result in lower operational costs as well. In fact, a recent Forrester study shows a 300% ROI and 4.2 months payback through Equinix interconnection solutions.

High performance and low latency are thanks to the Interconnection Oriented Architecture’s proximate high-speed interconnections to colocation centers and cloud providers. Colocated network peering means lower latency and fewer hops among interconnections.

2016 could be the year of the cloud for providers and their customers. Equinix can help both accelerate and optimize their cloud deployments and strategies.