recently published “Flexera 2023 State of the Cloud Report”According to , 82% of all respondents said their top cloud-related challenge was “managing cloud expenses.” Security was 79%. Next comes the lack of resources or expertise (78%). This change could be the result of companies becoming more comfortable with cloud security while having to manage more expenses as they become more dependent on cloud services, according to the report.
Increased interest in cloud cost management may be a result, with nearly half (45%) of all respondents indicating that expected cloud usage and spending is somewhat or significantly higher than expected due to economic uncertainty.
Flexera’s 12th Annual Report contains the results of a survey of 750 IT managers and professionals from various industries around the world. Let’s take a look at the cloud trends for 2023 that will help cost-conscious companies scale up their digital transformation initiatives.
Cloud dependency continues to grow
With the cloud becoming more mainstream, the survey found that more than half of all workloads and data are now in the public cloud. About two-thirds (65%) of all respondents said their company uses the public cloud a lot. This is an increase from 63% in the 2022 report.
Nearly 1 in 10 respondents (11%) say they use only one public cloud. The majority (86%) say they use multiple clouds (multiple public clouds (12%), hybrid clouds (72%)). Multicloud usage is down slightly from last year’s survey results. The most common multicloud implementations were application silos (44%), disaster recovery (DR), or system failover between clouds (42%).
The most used multicloud tools across all organizations were security tools (30%), followed by cost optimization (pinops) tools (29%). Organizations with more than 1,000 employees have increased their use of these tools. 68% say they use cost optimization tools and 63% use security tools.
Twenty-four percent of all respondents said their public cloud spend exceeds $12 million per year. 18% say their current cloud spend exceeds their existing budget. Cloud spending will continue to rise, with 30% of all respondents expecting it to increase over the next 12 months.
The race for cloud market share continues
AWS and Microsoft Azure are leaders among cloud service providers. The two companies compete fiercely as market leaders, widening the gap with other competitors. In the 2022 report, Azure outperformed AWS in adoption rate. In 2023, AWS regains the lead. 46% of companies say they run mission-critical workloads on AWS and 41% on Azure.
Based on each company’s cloud usage and adoption rate of public cloud service providers, mature cloud companies preferred market leaders. Companies that have been using the cloud for a long time and use it a lot tend to use AWS more often.
The fastest growing public cloud providers, based on the number of respondents currently testing or planning to use the cloud, are Google Cloud Platform and Oracle Cloud Infrastructure. They are tied at 28% each.
Cloud cost management remains a challenge
Plexera’s estimate of wasted cloud spend was 28%. This is a slight decrease from 32% in 2022. However, there is still a need to optimize costs and minimize waste. Indeed, moving to the public cloud continues to present challenges that ultimately drive up costs.
Identifying application dependencies (49%), assessing technology suitability (46%), and sizing or selecting the optimal instance (42%) were cited as the top challenges in migration to the cloud. Post-migration challenges, such as application management and cost optimization, followed. This demonstrates the importance of understanding each step of the migration process to optimize cloud costs.
Cloud cost management responsibilities are often spread across multiple teams within the company. But each year, the vendor management, finance, and accounting teams take less responsibility for cloud-related spend, and that responsibility shifts to the pinops team. In other words, the priority of pinops is getting higher and higher. About three-quarters (72%) of all respondents said they have a dedicated pinops team, and 14% said they plan to set up a pinops team within the next 12 months.
As a way to improve cloud cost optimization, nearly two-thirds of all respondents cited discounts from service providers they don’t currently use. Additionally, while unit economics, a key metric used by pinops to measure the effectiveness of cloud spend, can be difficult to implement, 39% of companies have already implemented a unit economic model to analyze cloud costs. This figure is expected to increase in the future, the report adds.
editor@itworld.co.kr
