Home Cloud Computing IaaS market on fast track to increased adoption

IaaS market on fast track to increased adoption

Australian businesses have moved past the initial cost savings they get from the adoption of cloud solutions to recognising the increased agility and scalability that adoption offers, according to a new report from Frost & Sullivan.

The report says that increasing awareness of cloud computing is driving an influx of market participant such as telecommunications providers, traditional IT companies and pure-play cloud vendors. The “robust momentum” that currently characterises the Australian IaaS (Infrastructure as a Service) and cloud computing market sees many organisations, from large companies to SMEs, adopting cloud solutions.

According to Frost & Sullivan’s Mayank Kapoor, most large organisations in Australia have now deployed a private cloud environment and “many are considering or have begun implementing an increasing number of mission critical workloads in the cloud.”

But Kapoor says that despite the benefits of cloud, many IT departments are still reluctant to move to the cloud, with common barriers to adoption including perceived loss of control, data sovereignty and security concerns when they move their workload and infrastructure to cloud. This concern is more common for public clouds, and is one of the reasons why many of the public cloud deployments in Australia are predominantly non-mission critical in nature.”

Frost & Sullivan reports that the “pure play” IaaS vendors are primarily global players and first movers such as Amazon and Rackspace, with recent entrants in the local IaaS market such as OrionVM, Cloud Central, Zetta Grid and UltraServe, also being successful.

“Telecommunications providers are actively moving into the cloud space and have a strategic advantage, because they can leverage their strong network capabilities through their underlying network. They can also offer private and public cloud offerings bundled with carrier services, says Frost’s Phil Harpur. “Telstra, Optus, Macquarie Telecom and AAPT have already embarked on cloud offerings as part of their strategic direction.

“A fast growing category is the Managed Service Providers (MSPs) in the IaaS space. Companies like Dimension Data, IBM, Fujitsu, HP, and local providers such as Brennan IT, Harbour IT and Melbourne IT are all expanding offerings in the cloud computing,” says Harpur. “Vendors in the IaaS market with a local data centre presence will have an edge over other players. We are witnessing many of the local IaaS players starting to establish or expand their local data presence in Australia.”

Frost & Sullivan cites one of the key benefits of using cloud-based IaaS solutions as the significant upfront savings that can be achieved, in terms of hardware and also associated maintenance costs, with the cloud model eliminating much upfront capital outlay.

“IaaS is rapidly becoming the delivery model of choice for companies looking at greenfield, test and development type of deployments or hosting applications in the cloud,” says Harpur. “With such low barriers to entry, the commercial case for any business of any size to adopt IaaS solutions is strong.”


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Graeme Philipson

Graeme Philipson is senior associate editor at iTWire and editor of sister publication CommsWire. He is also founder and Research Director of Connection Research, a market research and analysis firm specialising in the convergence of sustainable, digital and environmental technologies. He has been in the high tech industry for more than 30 years, most of that time as a market researcher, analyst and journalist. He was founding editor of MIS magazine, and is a former editor of Computerworld Australia. He was a research director for Gartner Asia Pacific and research manager for the Yankee Group Australia. He was a long time IT columnist in The Age and The Sydney Morning Herald, and is a recipient of the Kester Award for lifetime achievement in IT journalism.