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Global study: Hybrid model rules as cloud heats up, SaaS adoption blazing
Cloud catchy, SaaS infectious, says survey

Cloud” is the game and “hybrid” is the name. A recent global study has encouraging news for cloud-computing enthusiasts, revealing a sharp uptick in the adoption, as well as consideration, of cloud computing. The same study also indicates that those who are adopting cloud aren’t going whole hog, but are taking a hybrid approach -- mixing external and internal clouds.

The study, commissioned by global IT consultancy Avanade, showed a surprising increase in the interest in cloud computing, even from a similar study conducted in January of this year. In January, 54 percent of respondents said they had no plans to adopt cloud computing. By September, that percentage had shrunk to 37 percent.

At the same time, the percentage of companies planning or testing cloud computing increased three-fold, going from 3 percent of respondents to 10 percent.

What’s significant in the report is that less than 5 percent of companies are using an all-cloud model. The rest are relying on a hybrid approach, and report security concerns as the chief factor for being cautious.

Nine months ago, 61 percent of respondents indicated that they were using only internal IT systems and today, that number has dropped to 41 percent. At the same time, those using a combined approach on a global level have increased to 54 percent from 33 percent nine months earlier.

The report says it not clear whether the hybrid model will lead to a pure-play adoption at some point.

SaaS is taking off

One aspect of cloud computing that’s finding wide adoption is software as a service (SaaS), with more than half of the respondents worldwide -- and 68 percent in the US -- reporting that they have adopted SaaS at some level. Despite extremely high satisfaction -- more than 90 percent -- reliability is still an issue. About 30 percent of respondents said they had lost more than a day of business due to a service outage.

Still, the reliability concerns haven’t dampened users’ enthusiasm for SaaS, and 62 percent of respondents reported that they had plans to move into more SaaS within the next year. However, similar to their experience with cloud, users tend to deliver SaaS applications internally, rather than from the third-party provider.

On a global basis, those who deliver SaaS application internally outnumber those who used a third party by a ratio of 2 to 1. In the US, that increases to 4 to 1. Also, those who do use SaaS often rely on multiple providers, with one third using three or more providers. This leads the report to conclude that there is opportunity in the SaaS market.

Other conclusion from the report:

  • Cloud will continue to make significant inroads for the next year, although there won’t be a migration to a full cloud environment.

  • The gap is closing between companies with plans to adopt and those without. Avenade sees those curves intersecting in 2011 or 2012.

  • Despite the widespread adoption of cloud, there will be some applications that should remain on-premises.

  • SaaS adoption will continue to spread and is spreading faster than other technologies have in the past.

The study was conducted by Kelton Research and surveyed 500 C-level and IT executives worldwide.

BriefingsDirect contributor Carlton Vogt provided editorial assistance and research on this post.

About Dana Gardner
At Interarbor Solutions, we create the analysis and in-depth podcasts on enterprise software and cloud trends that help fuel the social media revolution. As a veteran IT analyst, Dana Gardner moderates discussions and interviews get to the meat of the hottest technology topics. We define and forecast the business productivity effects of enterprise infrastructure, SOA and cloud advances. Our social media vehicles become conversational platforms, powerfully distributed via the BriefingsDirect Network of online media partners like ZDNet and As founder and principal analyst at Interarbor Solutions, Dana Gardner created BriefingsDirect to give online readers and listeners in-depth and direct access to the brightest thought leaders on IT. Our twice-monthly BriefingsDirect Analyst Insights Edition podcasts examine the latest IT news with a panel of analysts and guests. Our sponsored discussions provide a unique, deep-dive focus on specific industry problems and the latest solutions. This podcast equivalent of an analyst briefing session -- made available as a podcast/transcript/blog to any interested viewer and search engine seeker -- breaks the mold on closed knowledge. These informational podcasts jump-start conversational evangelism, drive traffic to lead generation campaigns, and produce strong SEO returns. Interarbor Solutions provides fresh and creative thinking on IT, SOA, cloud and social media strategies based on the power of thoughtful content, made freely and easily available to proactive seekers of insights and information. As a result, marketers and branding professionals can communicate inexpensively with self-qualifiying readers/listeners in discreet market segments. BriefingsDirect podcasts hosted by Dana Gardner: Full turnkey planning, moderatiing, producing, hosting, and distribution via blogs and IT media partners of essential IT knowledge and understanding.

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