cloud computing in germany results of a cloud computing...

Cloud Computing in GermanyResults of a cloud computing user survey amongst German companies

Deloitte Consulting GmbH

March 2011

Cloud Computing represents a major change in information technology sourcing and

services delivery

Service Source

Public Cloud (External)

Hybrid Cloud

Community Cloud

Business Model

Cloud Service Subscriber

Cloud Service Broker

Cloud Service Provider

Cloud Service Enabler

Service Type

Business-as-a-Service

Software-as-a-Service

Platform-as-a-Service

Infrastructure-as-a-Service

Cloud Computing is changing in how business purchase and deploy IT services, based on

the emergence of internet standards and virtualization.

“Location independent resource

pooling”

“Rapid elasticity”

“Pay per use”

“Ubiquitous network access”

“On-demand self-service”

Internet technologies,

virtualization &

standardization

Private Cloud

Cloud Computing definitions used for this survey

Cloud Computing in Germany1

Cloud Computing is an architectural which has evolved from traditional vertically

integrated systems to multi-tenant model

Each stage brings higher capacity utilization, scalability, and flexibility

Traditional

Architectures

Large Scale

Hypervisors

Virtualized O/S

Multi-Tennant

Cloud Computing

Cloud computing use a highly virtualized shared computing environment

Stages of Computing Architectures

App

OS

Hardware

App

OS

Hardware

Virtualization

Hardware

Virtualization

Hardware

Cust A App

Cust A App

Cust A App

Cust A App

Cust B App

Cust B App

Cust B App

Cust B App

Cust C App

Cust C App

Cust C App

Cust C App

Customer

“A”

App

OS

Hardware

App

OS

Hardware

App

OS

Virtualization

App

OS

App

OS

Hardware

App

OS

Virtualization

App

OS

App

OS

Hardware

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

App

OS

Hardware

App

OS

Hardware

App

OS

Virtualization

App

OS

App

OS

Hardware

App

OS

Virtualization

App

OS

App

OS

Hardware

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

Customer

“B”

Customer

“C”

App

OS

App

OS

App

OS

App

OS

App

OS

App

OS

1

2

3

4

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM

VM


Possible usage models vary for cloud computing architectures in enterprise settings,

as shown below:

External Clouds

Data Centre

Private CloudIaaS Cloud Other

Clients

Vendor Data Centre

Other

Clients

Data Centre Core Systems

Data Centre

Hybrid Cloud PaaS

CloudOther

Clients

Vendor Data Center

Vendor Data Center

Enterprise Data Center

Private

CloudOther

Clients

Vendor Data Center

SaaS

Cloud

Enterprise Users


© 2011 Deloitte Consulting GmbH

Cloud computing is based on a virtual global delivery model. However, local

legislation needs to be obeyed for a ―world service‖

AustraliaFederal Privacy Amendment BillState Privacy Bills in Victoria, New South Wales and Queensland, new email spam and privacy regulations

Numerous State LawsBreach Notification39 States from CA to NY

European UnionEU Data Protection Directive and Member States Data Protection Laws

South AfricaElectronic Communications and Transactions Act

U.S. Federal

GLBA, HIPAA, COPPA, Do Not Call, Safe Harbor, Red Flags

Hong KongPersonal Data Privacy Ordinance

Canada Federal/ProvincialPIPEDA, FOIPPA, PIPA

ChileLaw for the Protection of Private Life

South KoreaAct on Promotion of Information and Communications Network Utilization and Data Protection

New ZealandPrivacy Act

ArgentinaPersonal Data Protection Law, Confidentiality of Information Law

PhilippinesData Privacy Law proposed by ITECC

TaiwanComputer-Processed Personal Data Protection Law

JapanPersonal Information Protection Act

IndiaLaw pending currently under discussion

Impact on Cloud Computing — N. America

• The data owner must take reasonable

steps to ensure that the service provider is

capable of maintaining appropriate

safeguards to protect customer

information.

• Companies subject to the Massachusetts

regulations should determine whether the

cloud provider maintains appropriate

security measures to protect the data to

be stored.

• A process must be determined for data

owner to be notified by the cloud provider

that its data had been subject to

unauthorized access or acquisition.

Impact on Cloud Computing — EU

• Data Controller must undertake

assessment of its responsibility for the

personal data processed by the cloud

provider and enter into a data processing

agreement requiring the cloud provider to

act only according to the company's

instructions.

• Legal mechanisms for data transfer are

challenging to implement in a cloud

context and may require the approval of

an EU data protection authority.

• Due to the increased level of public

access to the cloud, the cloud provider

should be required by contract to inform

data controllers of any data breach

incidents.

• Requests for access, blocking,

rectification, or deletion of data are

effectively and properly managed.

4 Cloud Computing in Germany


Due to lack in governance and a lack of trust in cloud providers limits the adoptation

of cloud based solutions within German corporations

No54%

Yes 46%

0 10 20 30 40 50 60

Unclear licensing

No financial advantage

Risk of vendor lock-in

Doubt with regards to the service

duration and availability

Conliance and legal

unclarity

Unsuffcient data protection

Limited control and

weak governance

5

The majority of German businesses is currently not using cloud services and is not planning to do so in the near

future

Main reasons against the usage of cloud serices are lack of control, compliance and limited trust in the

capabilities of the cloud providers

Prozent

1

2

1

2

Question: Are you currently using cloud services or do you intend to adopt cloud

based solution in your productions within the next 12 months?

Question: What are the reasosn for you not to embrace cloud services?

(Multiple answers possible)

Cloud Computing in Germany


Our analysis revelas a siloed approach for current cloud implementations

– IT is not recognized as a true business partner

6

Percentage 0 5 10 15 20 25 30 35

Other

Production

Logistics

Controlling

Finance

HR

Marketing

Service

Sales

IT

1

2

Percentage

0 25 50 75 100

Business

Business &

IT

IT 92%

8%

0%

0 25 50 75 100

Business

Business &

IT

IT 33%

50%

17%

Percentage

Question: Which departments are currently using Computing services?


Question: Whio is driving cloud services in your comapny?


• The current statistic reveal that cloud initiatives are mainly driven by the IT department

• Initiatives to drive the business by cloud services are driven by the business itself in in 50% of all cases

1

2



Amongst all cloud based solutions, companies take a more conservative approach

7

0

10

20

30

40

50

60

PaaSBPaaSIaaSSaaS

0

10

20

30

40

50

60

PublicHybridPrivate

• Software-as-a-Service is the most commonly used

cloud service

• Corporations have been less active in BPaaS und

PaaS based cloud implementations

Service-Typ

• Companies are currently embracing Private Cloud-

delivery models

• As a main driver the respondents argued with a

better manageability and end-to-end governance

Cloud-Typ

Percentage Percentage

Question: Please specify the cloud service type, which you have been using Question: Please specify the cloud type



Iaas and PaaS service types are currently evaluated in a private cloud model

8

• Many cloud initiatives are still in an

initial state

• IaaS and PaaS models are currently

evaluated

Private Clouds are mainly used in

the context of IaaS or SaaS delivery

models.

Participants commonly reported

unexpected cost increase when public

cloud based solutions were taken into

production

This might foster the adaptation of

private based Iaas and SaaS solutions,

as increase cost for fault operation and

security can be better contained

1

2

2

3

Cloud solutions in day-2-day operation

Initial Cloud implementations

2

Implemetation

status

3

1

Question: Please specify the state of readiness

of your cloud implementation

0 10 20 30

Esablis

hed

Produc

tion

Implementation

Pilot

Evaluation

0

2

4

6

8

10

12

14

0

5

10

15

20

25

30

PaaSBPaaSIaaSSaaS

PublicPrivate Hybrid


PaaSBPaaSIaaSSaaS


Cloud computing is only for a minority of respondents on the strategic agenda. The

current focus is pilot testing

9

• Cloud computing initiatives mainly carried out to

proof economical and technical benefits

Respondents have named functional benfits and the

instnat availability as additional benefits

• 74% of all participants have claimed that cloud

computing is currently not on their strategic agenda

Qurestion: Name you main motivation to use cloud services


Question: Is Cloud Computing part of you business or IT strategy?

Prozent

21

2

1

3

3

Not known

22%

Yes

(Clear approach and

defined roadmaps)

26%

No52%

0 10 20

Other

Compelling

reason to act

Clear cloud

mandante

Technical

pilot

Proof of economical

Benefits



• Flexibility due to increased scalability, cost reduction and the avoidance of larger investments are most frequentlyy

named benefits, which drive the cloud adaptation

• More than half of the respondents had to confrm that those benefits have not been realized yet

More than half of the respondents claim to not have achieved their expectations on

flexibility, cost reduction and avoidance of larger IT investments

10

Question: Have you been able to realize the benefits?

1

2

1

2

Percentage

Question: Which business and IT benefits are you addressing with cloud based solutions?


0 10 20 30 40

Decrease dependence on

internal IT

Avoidance of

investments

Cost reduction

Increased Flexibbility

Other

Increased functionality

Quick distribution

Yes 45%

No55%

Benefit not achievedBenefit achieved



• The majority of participants want to expand the footprint of cloud computing. Many of them have been able to

achieve the expected benefits

• About a quarter of all participants is planning to maintain the existing cloud computing approach just to observe

how th emarket in general and the cloud providers in particular are changing

• In most case companies want to proceed with coud computing the most frequently mentioned activity will nbe a

furhter integration of cloud services into the existing IT landscape. However, business critical processes and

systems remain out of scope

Corporations are willing to extend the adoptation of Cloud computing, if they manage

to achieve the expected benefits

11

1

2

1 3

0 10 20 30 40

Other

Revert

Maintain

Increase

0 10 20 30 40

Business critical

processe and

systems

Further migration into

the cloud

Further integration

Prozent Prozent

2

3

Question: What are your next steps with regards to cloud computiung?

(Multiple answers possible))

Question: What are you short term (next 12 months) activites in the cloud?

(Multiple ansers possible)



• The common criteria to vet the trustworthiness of an IT provider such as certification level, references and

recognition do also apply forcloud providers

• Interestingly enough, the location and local presence of a cloud provider play an important role

Cloud Computing provider can increase trust in their offerings by certificates and

good overall reputation

12

Q: What makes a cloud provider trustworthy? (multiple answers allowed)

Percentage

1

2

1

2

0 10 20 30 40 50

Independence

Established

Player

References

Auditiert/

Zertifiziert

Location

Brand



The adaptation of Cloud Computing is significantly higher in the US compared to

Germany. However security and governance are equally important

13

Germany USA

Adoptation

Level

German enterprises are leveraging cloud computing less.

Only 46% currently apply cloud services and the majority

is not planning to apply large scale cloud services in live

production

With 55%, US companies proof a higher cloud adaptaion

level with 90% forecasting cloud deployments within the next

three years

Provider

aspects

German and American companies apply similar selection criteria when choosing a cloud provider, such as security .

However, US firms seem to have more confidence in the mostly US based cloud providers

Confidence buiding aspects:

Certification, References, Track Record

Selecion criteria:

Security, Pricing, Scalability

Top Cloud

Computing

Provider

The same group of cloud provider is dominationg the market in the US as well as in Germany

1. Google

2. Microsoft

2. Amazon

3. IBM

4. Salesforce

1. Microsoft

2. Salesforce

3. IBM

4. Google

5. Amazon

Cloud Type Private cloud computing is seen as an entry model for larger corporations in both economies, US and Germany. In any

case a trade off between cost adavantages and trust issues for public clouds determines the actul deployment model

German coporations generally are in exploarion mode

when it comes to cloud cloud computing

US companies are very confident to leverage the cost

benefits of private clouds and are increasingly willling to

expand to public cloud models


© 2011 Deloitte Consulting GmbHInnovation Funding in the Cloud

R&D budget Market position Revenue

Innovation fundingFoster R&D activities: cash effect, strategic instrument andleverage effect

Public funding leads to significant benefits for all of the companies’ fields of

interest

14

• Funding is primarily granted in

form of non-repayable cash

grants cash effect

• Influence future funding topics

through own funding demand

• Stimulates investments in novel

technologies platform for future

product generations

• Strengthens networks

• Grants access to knowledge ahead

the state of the art

• Increases possibilities of new

market access

• Provides powerful

marketing channels

and tools

• Internationalization of

company

• Increase of ROI


Funding opportunities

EU level: ICT Work Programme 2011/2012

Innovation Funding in the Cloud15

What is funded (extract)?

• Management of cloud resources

• Technologies for infrastructure

virtualization

• Interoperability amongst different clouds

• Seamless support of mobile, context-

aware applications

• Energy efficiency and sustainability for

software and services on the cloud

• Integration of computing and networking

environments

• Open Source implementations of a

software stack for clouds

Where to apply?

• European Commission, DG Research

• Application for specific Calls published by

the EC

Modes of Funding?

• Non-repayable cash grants

• Funding quota: up to 50 % – 100 % of

eligible costs

funding quota depends on the

status of the funded entity (large

company, SME, university,

research istitutions, etc.)

Who is funded?

Consortia consisting of at least three

partners of different nationality from

• Companies conducting R&D in Europe

• Universities

• Research institutions

• Selected public bodies

EUR 1.9

billion*

* Planed funding budget for ICT innovation projects in 2011/2012 (FP 7)


Funding opportunities

Federal level: IKT 2020 Strategy

Innovation Funding in the Cloud16

What is funded (extract)?

• Trusted Cloud Initiative: IaaS-, PaaS-,

and SaaS applications for private and

public sector Community Clouds

• Horizontal applications eg. costumer

relationship management, HR,

accounting

• Regional clouds

• Applications serving the needs for

enhanced security of public bodies

• Other applications with innovative cloud

approaches

Where to apply?

• Ferderal Government of Germany:

Federal Ministry of Economics and

Technology

Federal Ministry of Education and

Research

Modes of Funding?

• Non-repayable cash grants

• Funding quota: up to 50% - 100%

funding quota depends on the

status of the funded entity (large

company, SME, university,

research institutions etc.)

Who is funded?

• Companies conducting R&D in Germany

• Universities

• Research institutions

• Public bodies

EUR 1.5

billion*

* Federal funding granted within the IKT 2020 Strategy since 2007


Your Contact at Deloitte

Deloitte Consulting GmbH

Rosenheimer Platz 4

81669 Munich

Germany

Tel: +49 (0)89 29036 7940

Mobile +49 (0)171 5600867

[email protected]

www.deloitte.com/de

Robert HorndaschPartner

Technology, Media and

Telecommunications

17 Cloud Computing in Deutschland

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