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Febr uar y 2012 $ 99

Report ID: R4020212

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2012 State ofCloud ComputingMore than 500 IT pros weighed in on their use of publiccloud services, and we can sum the results up in two words:

blind leap. Just 28% assess the impact on their internalnetworks, even though 73% are using multiple providers.Its not too late to reverse the lemming migration. Heres how.

By Michael Healey

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reports

3 Authors Bio

4 Executive Summary

6 Research Synopsis

7 The Cloud You Didnt Know You Had

9 The Reality of SLAs

10 Impact Assessment

11 How to Make Cloud Soup

13 A Healthy Helping of Worry

15 Can You Go All In?

15 Three Points on a Path

18 The Big Leap

19 Appendix

29 Related Reports

Figures

7 Figure 1: Identifying Cloud Impact on Internet-

Facing Architecture

8 Figure 2: Monitoring Cloud-Based App

Performance

9 Figure 3: Cloud SLAs

11 Figure 4: Number of Cloud Providers Used

12 Figure 5: Integrating Cloud Applications

13 Figure 6: Cloud Provider Preference14 Figure 7: Cloud Services Concerns

15 Figure 8: Weighing the Risk

16 Figure 9: Future Degree of Cloud Use

17 Figure 10: Use of Cloud Computing

Services

19 Figure 11: Cloud Providers in Use

20 Figure 12: Planned Cloud Provider Use

21 Figure 13: Replace or Fire a Cloud

Provider?

22 Figure 14: Greatest Performance Inhibitor

23 Figure 15: Cloud-Based App Performance

24 Figure 16: Change in Performance

25 Figure 17: Job Title

26 Figure 18: Company Revenue

27 Figure 19: Industry28 Figure 20: Company Size

CONTENTS

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TABLE OF

2 0 1 2 S t a t e o f C l
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2012 InformationWeek, Reproduction Prohibited

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2 0 1 2 S t a t e o f C lTable of Contents

Michael Healey is the president of Yeoman Technology Group, an engineering

and research firm focusing on maximizing technology investments for organi-

zations, and an InformationWeek Reports contributor. He has more than 23

years experience in technology and software integration.

Prior to founding Yeoman, Mike served as CTO of national network integrator

GreenPages. He joined GreenPages as part of the acquisition of TENCorp, where

he served as president for 14 years. Prior to founding TENCorp, Mike was an in-

ternational project manager for Nixdorf Computer and a Notes consultant for

Sandpoint Corp.Mike has taught courses at MIT Lowell Institute and Northeastern University

and has served on the Educational Board of Advisers for several schools and uni-

versities throughout New England. He has a BA in operations management from

the University of Massachusetts Amherst and an MBA from Babson College.

He is a regular contributor to InformationWeek, focusing on the business

challenges related to implementing technology. His work includes analysis of

the SaaS market, green IT and operational readiness related to virtualized

environments.

Michael Healey

InformationWeek Reports
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Next time that annoying guyyou know the onestarts going on about how the

cloud is going to change everything, smack him upside the head. Everything has al-

ready changed, say the 511 business IT professionals, all from companies with 50 or more

employees, responding to our InformationWeek2012 State of Cloud Computing Survey.

Adoption of public cloud services has been on a consistent upward pace for the past four

years, since we began keeping track. One-third of 2012 respondents organizations are al-

ready receiving services from a cloud provider, and an additional 40% are in the planning

or evaluation stages. Just 27% say they wont consider it. In our 2008 cloud survey, people

couldnt even agree on a definition21% of 456 respondents from companies of all sizes

said cloud was pretty much a marketing term used haphazardly.

OK, so not everything has changed.

Still, frustration with vendor hype aside, all types of public cloud services, whether SaaS,

IaaS or PaaS, are gaining followers. So ITs got this down, right? Not so fast. Were seeingmajor gaps in how organizations are selecting, integrating and monitoring the services

their employees depend on. The bulk of cloud initiatives come from the ground up and

are reactive, in response to line-of-business requirements. IT rarely has an overarching vi-

sion of how it all fits together. Dont believe us? Then explain why only 28% of organiza-

tions scope out the potential impact of a cloud service on their internal architectures

prior to going liveespecially given thetransition our data centers are going through. Or

that 24% have no performance monitoring in place at all.

It gets worse. Almost half of respondents have opted to custom code each application

directly into internal back-end systems, with only 9% leveraging cloud integration

providers. Thats an expensive omission: Integrators large and small not only have

ready-made tools, they can help you conserve bandwidth, as well discuss. Combine this

customization nightmare with the fact that 73% of respondents already use multiple

EXECUTIVE


reports

SUMM

ARY

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cloud providers, and we foresee heartburn in our future.

In fact, it appears that the bloom is already off the rose for some. While were still hiring

cloud providers, this year, we saw a clear downward trend in opinions about performance

and vendor satisfaction levels. In fact, 14% of organizations have fired a cloud provider,

with 22% of those saying it had a major or catastrophic impact on the business.

We expect the march to the public cloud to continue unabated, spurred by the siren

song of lower costs, quicker implementation, and even less need for internal IT. Should we

just fall in line and accept the inevitable?

Not so fast. Cloud computing is still very much a work in progress, wedged somewhere

between CB radios and penicillin on the worldwide-usefulness scale. Providers offers of

lower initial cost and faster ramp up have lulled many organizations into a sloppy start,

but you can get back on track. In this report, well lay out the critical steps every organiza-

tion needs to take to make sure its cloud leap goes on more than just faith.

EXECUTIVE


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SUMM

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RESEARCH

Survey Name InformationWeek2012 State of Cloud Computing Survey

Survey Date December 2011

Region North America

Number of Respondents 511 at organizations with 50 or more employees

Purpose To determine in the role of cloud computing in the enterprise

Methodology InformationWeeksurveyed business technology decision-makers at North

American companies with 50 or more employees. The survey was conducted online, and

respondents were recruited via an email invitation containing an embedded link to thesurvey. The email invitation was sent to qualified InformationWeeksubscribers.

reports

SYNO

PSIS


ABOUT US

InformationWeek Reports

analysts arm business technol-

ogy decision-makers with real-

world perspective based on

qualitative and quantitative re-

search, business and technology

assessment and planning tools,

and adoption best practices

gleaned from experience. Tocontact us, write to managing

director Art Wittmann [email protected],

content director

Lorna Garey [email protected],

editor-at-largeAndrewConry-Murrayat [email protected], and

research managing editor

Heather Vallis at

[email protected].

Find all of our reports at

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Its downright shocking to think that almost

three-quarters of the 511 business IT profes-

sionals responding to our InformationWeek

2012 State of Cloud Computing Survey are in

the public cloud, planning to get there or con-

sidering cloud services, yet only 28% have

scoped out the impact on their Internet-fac-

ing architectures. This is a major miss that can

have a huge impact on your business.

The first and most obvious issue is the im-

pact on bandwidth, from user activity as wellas integration traffic and any planned back-

ups. Second is the question of redundancy, for

your data lines as well as the cloud application

itself. Obvious or not, these issues are going

unresolved because of a lack of proper moni-

toring. Only 28% of respondents already in the

cloud do what we consider proper internal

oversight of their setups, including status

monitoring, application tracking and through-

put/performance monitoring.

To be fair, most IT teams dont have a ton of

experience designing their networks for inte-

grated connectivity with public cloud ser -

vices, whether SaaS, PaaS or IaaS; most of us

just focus on getting the biggest pipes we can

afford. And traditional network and system

management platforms havent evolved to

support the complex traff

environmental monitoring

truly understand a hybrid

computing environment. F

have to do some serious c

Previous Next

2012 2011

Have you scoped out the potential impact of a cloud service on your Internet-facing architectur

Identifying Cloud Impact on Internet-Facing Architecture

Yes

Not yet, but we plan to

Not yet, but we will before adopting any new services

No, and we have no plans to do so

Dont know

Base: 375 respondents in December 2011 and 272 in October 2010 using, planning to use or considering cloud compu

Data: InformationWeek State of Cloud Computing Survey of business technology professionals at organizations with

26%

4%

8%

8%

6%


The Cloud You Didnt Know You Had

reports 2 0 1 2 S t a t e o f C lTable of Contents

Figure 1

2012 InformationWeekCloud ROI Modeler

This Cloud vs. In-House invest-

ment modeler, a supplement to

the InformationWeek2012 Stateof Cloud Computing report, is

intended to give some general

guidelines when considering a

cloud initiative. Data has beenprovided as a sample to be

used as a starting point. All

fields are unlocked and can bemodified to suit your particular

business needs.

DownloadDownload
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bining existing suites, like those from CA, HP

OpenView and IBM Tivoli with one or more of

the tools offered by platform providers such

as Amazon, Salesforce.com and VMware; we

also recommend looking at the new breed of

monitoring as a service tools from the likes of

AppDynamics, LogicMonitor and New Relic.

Speaking of monitoring, the 67% who say

their companies are not yet making use of a

public cloud service may be in for a rude

awakening. Cloud apps have a sneaky way of

creeping into an enterprise. Box.net claims

more than 5 million users from 60,000 busi-nessesvery likely including yours. And dont

just blame the rank and file. Your IT staff is

likely guilty of spinning up a few GoGrid vir-

tual servers or an Amazon instance here and

there. Its nothing to be ashamed of, but igno-

rance isnt going to be an excuse if Dropbox

gets hit with a major breach and you find out

that a saleswoman put an unencrypted

spreadsheet containing customer information

in her file share.

Its time to find out exactly how much cloud

you already have. The audit needs to start

with some good old-fashioned log file analy-

sis of your inbound and outbound traffic. It

should be fairly easy to identify usage and

track it back to the individual or department.

We recommend this versus asking if any-

ones done an end run around IT. Not only

does such an audit help

rogue projects, it gives yo

experience building out m

formance tracking. This is a

cially for larger enterprise

true picture of whats in u

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2012 2011

Do you ac tively monitor performance of your cloud-based applications?Monitoring Cloud-Based App Performance

Yes; our own basic monitoring (up/down)

Yes; our own advanced monitoring (application and transaction throughput monitoring)

Yes; vendor-provided basic monitoring

Yes; vendor-provided advanced monitoring (application and transaction throughput monitoring)

No; no formal monitoring is in use

Base: 166 respondents in December 2011 and 125 in October 2010 using cloud computing services

Data: InformationWeekState of Cloud Computing Survey of business technology professionals at organizations wit

24%

20%

28%

16%

19%

21%

5%

6%

24%



Figure 2


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mine whats already been agreed to. If a de-

partment or group has opted into a vendors

standard offering, its likely it just signed the

contract and accepted stock SLA terms.

The Reality of SLAs

Cloud service-level agreements are the

equivalent of a speeding ticket. Many people

claim theyve beaten a ticket, but in reality,

most of us get exactly whats coming to us.

While 71% of respondents say they review

the general vendor agreement and then ne-

gotiate terms, only 11% provide a templatethat providers must conform to. Fifteen per-

cent are honest enough to admit accepting

terms as is.

Larger organizations can turn contracts over

to their vilified (but secretly adored) contracts

departments and let them battle providers.

However, the vast majority of cloud SLAs are

set, and were forced to either accept or nego-

tiate the providers terms.

The reality is that only the largest enter-

prises will be able to negotiate terms; we dis-

cuss how to get the best cloud SLA in more

depth here andhere.

But even giants like the federal government

have to bend a bit, like in the case of the Gen-

eral Services Administrations recent email

contract. The language of the request for pro-

posal originally required data centers located

in the continental United States only; it was

modified partway thro

process to allow any locat

curity requirements of the

has data centers worldwi

awarded the contract, and

have migrated so far, but th

center location continues.

November 2011 $99

ReportID:R3271111

Next

reports

Clouds Role inBC/DR StrategyThesedays,automaticallyreplicatingandarchivingdatatoan

offsiteproviderisassimpleasplugginginanetworkstorage

applianceandfillingoutafewWeb screensandrecoveryis

aboutaseasyandtransparent.Backingupapplicationsisnt

quitesostraightforward,thoughpairinginternalvirtualized

appswithcloud-basedVMsallowsevensmallenterprisesto

achieveseamlessrecoverytoworld-classfacilitieswithnear-

instantaneousfailover,withoutbreakingthebank.

ByKurtMarko

re p o rt s . i n f o rma t i o n w e e k. c o m

Related Report

These days, automatically repli-

cating and archiving data to anoff-site provider is as simple as

plugging in a network storage

appliance and filling out a fewWeb screensand recovery is

about as easy and transparent.

Backing up applications isntquite so straightforward, though

pairing internal virtualized apps

with cloud-based VMs allowseven small enterprises to achieve

seamless recovery to world-class

facilities with near instantaneous

failover, without breaking the

bank.

DownloadDownload



How do you create your SLA agreements with cloud providers?

3%

15%

11%

71%

Cloud SLAs

Base: 166 respondents using cloud computing services

Data: InformationWeek2012 State of Cloud Computing Survey of 511 business technology professionals at organizemployees, December 2011

Other

Provide them with a templatethey must conform to

Accept their terms as is

Review their gethen negotiate

Figure 3
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Even if you do negotiate service-level con-

cessions, the question then becomes, What do

you get if theres an outage? When Microsoft

had its big outages last year with Office 365,

which included downed email, customers got

a paltry 33% refund on their monthly service

fees. Dig out the cost of downtime calcula-

tor from your last business continuity plan ex-

ercise and see if that would cover lost rev-

enue. Not quite.

It comes down to this: No public cloud ven-

dor will ever agree to the

same SLAs that you can createin-house, the legendary five-

nines. A hosting provider like

AT&T or Rackspace might

match that for a specific ser-

vice or hosted data center, but

youll never get such an agree-

ment on end-to-end connectivity. Nobody

can guarantee uptime in the public, or even

in a hybrid, cloud.

Say it, breathe it, live it. There is a downtime

reality you wont be able to control. While

most IT organizations accept this as common

sense, its amazing we dont do a better job

educating our business users. Time Warner

and scores of other sites had problems last

year related to Juniper switches and faulty

firmware. This caused immense pain for scores

of people who work at home and undoubt-

edly called IT in a huff.

This is where monitoring

become critical. IT always

any technology failure bef

ing, and incorporating ou

the potential to exacerb

There were outages last

every big providerMicro

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No public cloud vendor will

ever agree to the same SLAs

that you can create in-house,

the legendary five-nines.

Impact to Benefit Risk

IT Organization

Business Organization

Business Competitiveness

Bottom Line:

GG G G GIntroduce a whole new platform option t hatcan bring speed,flexibility, and potential cost savings to

almost every element of the organization

GG G G G Requires a serious your IT group.Challenges everyt

work to staffing plans.Its easy t

nore the big picture but youll ha

GG G G G Big potential of sthat people cant handle. Needs

lock step with IT to make sure d

tween all systems lest you lose y

GG G G G Long term total building silos that someone el

everyone pause

GG G G G Brings all of the same benefits that IT gets,plus some potentially more advanced applications partic-

ularly as it relates to newer end user computing

GG G G G Faster ramp up,more scalability,and lowerup-front costs have businesses drooling

Cloud as a computing is a valid option every organization needs to put into its planning.Simply ignoring it leaves you open to

you anyway.Adopting without a bigger framework that i ncludes investments in interoperability,sec urity and long term man

sure way to blow another golden opportunity.

GG G G GGG G G G

Impact Assessment: Cloud Computing


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ware, even Research In Motion. The calls go to

you, not them. Proactive monitoring is the

only way to ensure that your team knows

whats going on before the phone rings.

How to Make Cloud Soup

Given that most IT teams today support a

mishmash of applications, operating systems

and hardware platforms, its no surprise that

the majority of respondents have multiple

cloud providers. Even organizations that em-

brace all Oracle or all IBM find it difficult to

use their anointed vendor 100% of the time,especially when it comes to email, mobility

and productivity applications.

Respondents are fairly split over whether

they favor a good partner fit or platform con-

sistency; 29% select based primarily on the

end product, regardless of who the provider

is, while 27% value having a manageable set

of vendors. Most, 44%, opt for a balanced

weighting between the two.

Regardless of your preference, you still have

an integration challenge to overcome. Weve

been able to manage data integration inter-

nally through standard plug-ins, custom code

or by just letting users pull data together via

business intelligence or data warehousing

apps. Sharing data among internal applica-

tions, however, is quite a bit different from

making public cloud apps play welland yet

we seem to treat these challenges the same

way, with an astounding 4

code to integrate services

cations (see Figure 5).

That hub-and-spoke app

crippling your network.

company uses SaaS-based

agement, hosted email a

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Regardless of the number of different platforms and options, how many actual cloud providers(e.g., Salesforce, Google, Oracle, GoGrid)?

27%

4%

5% 64%

Number of Cloud Providers Used


Data: InformationWeek 2012 State of Cloud Computing Survey of 511 business technology professionals at organizaemployees, December 2011

2 to 5

1

6 to 10

More than 10



Figure 4

FAST FACT

91%say their companies use

five or fewer cloud

service providers.


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forms. All data is synced back to the internal

accounting and ERP systems via custom code.

Not only have you increased your inboundtraffic fivefold, youre stuck supporting five

custom integration points and often having

users wait a day for updates.

Integration as a service continues to evolve

as a compelling alternative. Upstarts like Jit-

terbit and SnapLogic compete with larger

vendors, including IBM and Informatica, that

have built out their portfolios internally (In-

formatica) or by acquisition (IBM bought

Cast Iron).While only 9% of cloud-using respondents

leverage these systems today, they should be

a core part of your cloud adoption strategy,

especially when it comes to maintaining links

and managing the growing amount of data

residing off-site. These integration vendors are

a natural outgrowth of the industry. Cloud

vendors have to provide connectivity to end

clients, but they have no incentive to work to-

gether. Its a natural fit for pure connectivity

vendors. While the function of a Jitterbit or

IBM Cast Iron may start with data integration

today, we can see this role expanding to data

analysis and enterprise search. If youre think-

ing you might just wait until new cloud stan-

dards are ratified by some agnostic commit-

tee, remember that IT standards groups move

so slowly, theyre actually mocked by the U.N.

Security Council. We dont think cloud stan-

dards effortswhether th

liance, Cloud Standards

DMTF, Open Data Cent

TOSCA, or Bubbas Cloud

any different.

Integration aside, ther

what touchy question o

Previous Next

How do you integrate your different cloud and SaaS applications?

Integrating Cloud Applications

Custom coding directly to our internal system using each vendors API

Leverage an internal integration platform

Leverage a traditional VAN for data integration

Leverage a cloud-based integration platform

Other

Dont know

Note: Multiple responses allowed


Data: InformationWeek2012 State of Cloud Computing Survey of 511 business technology professionals at organizemployees, December 2011

14%

10%

9%

11%

27%



Figure 5

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end user access to disparate services. While

Microsoft Active Directory tends to domi-

nate internal network access, theres a mish-mash of authentication schemas in the

cloud. Enterprise IdM (identity management)

systems have a lot of catching up to do, es-

pecially when you look at the huge range of

configuration possibilities related to the

cloud. As we discuss in our recent IdM re-

search report, cloud-based IdM and federa-

tion vendors seek to negate the need to

manage and configure a vendors IdM sys-

tem to run on your network. Rather, the ideais that you grant the vendor access to inte-

grate your user directory to its IdM system;

the provider then connects out to various in-

tegration points, such as your Active Direc-

tory or LDAP store.

The enterprise single sign-on space has

long been dominated by a mix of large and

niche players, like CA, IBM and Oracle and Ac-

tivIdentity and Imprivata. These vendors are

now playing catch-up to manage ser vices

such as those from Amazon, Google, Mi-

crosoft, Oracle and Salesforce. Likewise, a host

of third-party SSO and IdM options are avail-

able from the likes of Apere, OneLogin, Okta,

Ping Identity and Symplified that either

started as SaaS/cloud apps or were quickly

retooled to capture mindshare. Its a big field

that will only get bigger as VMware, Syman-

tec and others join the fray.

A Healthy Helping of Wo

Security has dominated

cloud concerns for the las

that is essentially unchan

profile breaches not only

light on the problem but

tributor to the big jump

Previous Next

Which of the following best describes your preference when it comes to cloud providers?

27%

29%

44%

Cloud Provider Preference

Base: 240 respondents using or planning to use cloud computing

Data: InformationWeek 2012 State of Cloud Computing Survey of 511 business technology professionals at organizaemployees, December 2011

Provider consistency; having a manageableset of providers is a top priority and a

major factor in the decision

Platform fit; selection is

based primarily on the end productregardless of who the provider is

Balanced; wedetails and p



Figure 6
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dents who say cloud providers are riskier to

work with compared with traditional out-

sourcers or third parties. Its interesting thatworries about cloud features and vendor

lock-in have declined, in some cases fairly sig-

nificantly. But we have no doubt that the in-

ability of public cloud vendors to quell secu-

rity concerns is a serious drag on their

business. It also doesnt surprise Scott Mat-

sumoto, principal consultant at the security

testing firm Cigital. A lot of security profes-

sionals just dont get cloud,

says Matsumoto. Securityteams tend to focus on infra-

structure and architectural se-

curity as the core part of their

model. They have to naturally

give that up as part of a cloud

implementation. Theres an inherent lack of

control associated with it that many just cant

come to grips with.

But he also realizes that infosec teams do

get overruled or bypassed. He advises devis-

ing a standard audit approach that evaluates

the vendors application suite and underlying

technologies, so youre prepared for requests.

Organizations need to be able to expand

their security frameworks to incorporate the

different risks and benefits

the variants of cloud com

They just cant say no.

Previous Next

When thinking about risks related to using cloud services, what are your top concerns?

Cloud Services Concerns

Note: Three responses allowed

Base: 511 respondents in December 2011 and 399 in October 2010


2012 2011

Securitydefectsinthetechnologyitself

Unauthorizedaccesstoorlea

kofourcustomersinformation

Unauthorizedaccesstoorlea

kofourproprietaryinformation

Applicationandsystem

perfo

rmance

Integrationofclouddatawithourinternalsystems

Businessviabilityofprovider;riskcompanywillfail

BusinesscontinuityandDRreadinessofprovider

Vendorlock-i

n

51%

51%

48% 5

1%

48% 5

0%

31% 3

3%

29%

N/A

26%

27%

22%

28%

15%

21%



Figure 7

A lot of security professionals

just dont get cloud.

Scott Matsumoto, Cigital


15/29

Can You Go All In?

You cant say no, but for all but the very

smallest shops, youre not going 100% publiccloud, either. Were always intrigued with the

plucky few with this goal, though. In our 2012

survey, 4% of respondents say that, in 24

months, they expect 75% or more of their IT

services to be delivered from the cloud.

Sounds nice. Use Chrome laptops. Always

be connected. Never worry about backup. Be

free of IT.

Is it feasible? Not likely, especially if you

have an office with 100 or more users. Imag-ine the bandwidth requirements if all trans-

actions, Office documents, email, backups, an-

tivirus scans, heck, even printing had to go

out over the wire, then back in. Even all in

suites like NetSuite and SAP lack the ability to

offer integrated Office documents. Remem-

ber, a major draw of the cloud is the lower up-

front costs and perceived long-term cost sav-

ings. We say perceived because things

arent that simple. Taking even one user all in

with a true enterprise design gets pricey

pretty quick, as we show in our table.

Three Points on a Path

Cloud computing is at an interesting

pointdefinitely here to stay, but with grow-

ing pains still ahead. Many early adopters we

spoke with are now grappling with the moni-

toring, management and integration require-

ments they somehow ignored during the

honeymoon phase. The cloud has brought

much higher prices and lo

vice, says an infrastructur

agency. However, since w

cannot bring the function

The 40% of respondents

or evaluation stages have

these pitfalls. Unfortunatel

ignoring the pioneers an

Previous Next

2012 2011

When comparing cloud service providers with traditional outsourcers and third-party suppliersthese risks are...?

Weighing the Risks

Greater with cloud providers

About the same

Lower with cloud providers

Dont know



6%

6%

11%

12%

FAST FACT

6%believe theres less risk in

using a cloud provider

than in using other third-

party providers, un-

changed from our 2011

survey.



Figure 8


16/29

same traps that come with the promise of a

quick implementation and a low up-front cost

(see our Cloud ROI Modeler). Of the 27% still onthe sidelines, our take is that some only think

they dont have public cloud services in use by

employees, others dont see a need. Every-

ones selling it, but I have yet to find a reason

to replace what we have, one respondent

says. We have secure remote access to our

data anywhere in the world.

Then there are the zealots. There will always

be a the cloud is evil tea party-like fringe,

but weve noticed that the percentage of re-spondents who fall into this category has

dwindled to a loud and angry minority, un-

able to force everyone else to change and

destined to fall in with the factions that hate

Microsoft, Apple, open source, Oracle, Cisco

you name it.

If youre still on the sidelines, pay close at-

tention to those who are blazing this trail. Talk

to peers. Early adopters are pushing vendors

to continuously drive down costs and im-

prove functionality, and theyll inevitably

make mistakes you can learn from. Three ar-

eas in particular to watch:

>> Be realistic about IT capital budgets.

Theyll likely never return to prerecession levels;

virtualization and cloud computing have

changed that forever. So y

move to more of an opex fo

in our recent report on the m

>> Understanding w

Previous Next



2012 2011

Looking ahead 24 months, what percentage of your IT services do you predict will be delivered

Future Degree of Cloud Use

75% or more; IT is a four-letter word to us

50% to 74%; if it can be outsourced, were looking to do it

25% to 49%; our core business isnt IT and were happy to use outside services

10% to 24%; some tasks are better done by others

1% to 9%; very limited usage

None, we hate the cloud


Data: InformationWeekState of Cloud Computing Survey of business technology professionals at organizations with

4%

2%

11%

14%

18%

17%

6%

8%

Figure 9
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17/29

capabilities are in terms of your teams

and existing platforms is a critical first

step.This will help you identify gaps and es-tablish a base set of requirements that en-

courages cloud use on your terms. Yes, we

said encourage.

>> Figure out a rational cloud-approval

procedure. Cloud never goes through the

governance process, says one enterprise sys-

tems architect. Finance only cares about cap-

ital projects, so they just slip around the side.

This is a major gap that we see

in multiple industries. IT needsto be looped in, and that

means putting in place a

streamlined, nonpunitive

process for business units. Its

highly likely you have multiple

cloud instances running al-

ready. IaaS, SaaS, PaaS, storage, testing,

backupsomebody has already gone rogue.

Get a handle on the amount of usage, identify

festering security or performance problems,

and lay out guidelines so people will actually

approach IT early on.

The elements of a cloud policy are fairly

straightforward: Establish baseline security

requirements, integration guidelines and

standard service levels everyone can under-

stand. Offer monitoring and management

options as a core part of the provisioning

process.

Long term, flexibility, speed to market and

lower cost always determine the success of a

new technology. Public cl

sent a continuation of th

application, platform and i

IT needs to position itself

hybrid cloud option, with

external systems playing

true service-oriented IT. J

public cloud becomes pa

tion and not just a leap of

Previous Next



2012 2011

What are your organizations plans for cloud computing?

Use of Cloud Computing Services

Were receiving services today from a cloud provider

Were planning to use services from a cloud provider within the next 12 months

Were considering using services from a cloud provider

We have no plans to use services from a cloud


Data: InformationWeek State of Cloud Computing Survey of business technology professionals at organizations wit

14%

14%

26%

23%

27%

Figure 10

Flexibility, speed to market

and lower cost always

determine the success of a

new technology.
http://reports.informationweek.com/abstract/83/8438/IT-Business-Strategy/research-service-oriented-it.htmlhttp://reports.informationweek.com/abstract/83/8438/IT-Business-Strategy/research-service-oriented-it.htmlhttp://prevpage/http://reports.informationweek.com/indexhttp://reports.informationweek.com/indexhttp://reports.informationweek.com/indexhttp://reports.informationweek.com/indexhttp://reports.informationweek.com/abstract/83/8438/IT-Business-Strategy/research-service-oriented-it.htmlhttp://reports.informationweek.com/indexhttp://reports.informationweek.com/indexhttp://prevpage/


18/29

Previous Next



Like This Report?

Rate It!Something we could dobetter? Let us know.

RateRate

Can you go all in? The concept of

leaping headlong into the cloud is al-

ways kicked around, but is it realistic?

Any enterprise would still need its investment

in network infrastructure, cabling, printing, let

alone large datasets that require single user

access, like AutoCAD.

Its also important to note that there are

some major gaps, particularly when it comesto finding suitable applications for manufac-

turing, distribution and other specialty apps.

We took a scenario of a pure office worker

with no required access to external resources

that couldnt be placed in the cloud. We gave

two starting points, one Google-based and

one Microsoft-based, to provide some inter-

esting annual costs (see chart, right).

Note: We added in a backup 4G data plan and

a voice-over-IP plan since this is truly a cloud

user who could never be without access to

data. We also added access to Box.net since any

pure cloud player will eventually have to share

outside with someone who doesnt allow ac-

cess to Google Docs or Office 365. Standard

vendor quantity prices were used as reference.

These costs dont include any calculations

related to moving your custo

apps to a hosted environmen

vide virtualized desktops for

youll still need a network w

ing for high-speed Web acce

The Big Leap

REALITY CHECK

Sample Configuration 1: Google-Based Sample Configuration 2: Micro

Google Chrome laptop with 3G access $639 Annualized 3-year cost of laptop with hardw

VoIP Web solution (access and voice mail) $708 Office 365 (with Office Suite, Exchange and V

Google enterprise email and app $50 Box.net access

Box.net access $180 VoIP Web voice access

NetSuite ERP $1,000 Salesforce.com

GoToMeeting $588 WebEx

Additional 4G data plan $600 Intuit accounting/finance

S uppl em ent al dat a bac ku p s er vi ce $3 6 Addit io na l 4G data pl an f or bac ku p

Supplemental data backup service

Per user $3,765

Note: Users can mix and match cloud and SaaS options between the two samples based up on their a
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Previous Next


reports 2 0 1 2 S t a t e o f C l

A

PPENDIX

2012 2011

Which of the following types of providers are currently being used by your organization?

Cloud Providers in Use

SaaS providers

Virtualization technology providers

Platform providers

Infrastructure providers

Other



Data: InformationWeekState of Cloud Computing Survey of business technology professionals

R4020112/2

57%

56%

56%

61%

42%

35%

27%21%

11%

16%

Table of Contents

Figure 11


20/29

Previous Next

2012 2011

Which of the following types of providers is your organization most likely to begin using within the next 12 months?

Planned Cloud Provider Use

Virtualization technology providers

Platform providers

SaaS providers

Infrastructure providers

Other


Base: 240 respondents in December 2011 and 147 in October 2010 using or planning to use cloud computing

Data: InformationWeek State of Cloud Computing Survey of business technology professionals at organizations with 50 or more employees

R4020112/5

48%

40%

42%

42%

36%

31%

26%38%

14%

16%



Figure 12
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Previous Next

Have you ever had to replace or fire a cloud or SaaS provider?

14%

86%

Replace or Fire a Cloud Provider?


Data: InformationWeek 2012 State of Cloud Computing Survey of 511 business technology professionals at organizations with 50 or moreemployees, December 2011

R4020112/8

No

Yes



Figure 13


22/29

Previous Next

2012 2011

What do you believe is, or would be, the biggest bottleneck for performance of cloud-based applications?

Greatest Performance Inhibitor

Our own Internet bandwidth and connectivity

Actual application and system design of vendors application

Overall Internet traffic

Cloud vendors Internet connectivity

Other

Dont know

Base: 375 respondents in December 2011 and 272 in October 2010 using, planning to use or considering cloud computing services


R4020112/11

31%

31%

27%

29%

23%

25%

12%8%

2%

2%

5%

5%

FAST FACT

31%say their companies own

Internet bandwidth is the

obstacle to performance

of cloud-based apps, the

same percentage as in

our 2011 survey.



Figure 14


23/29

Previous Next

2012 2011

How would you rate the general performance of any cloud-based applications in use in your organization?

Cloud-Based App Performance

Better than same app hosted in-house

Equal to in-house app

Subpar compared with in-house app



R4020112/13

27%

26%

54%

56%

19%

18%



Figure 15


24/29

Previous Next

2012 2011

How has the performance of cloud-based applications in use in your organization changed over the last year?

Change in Performance

Gotten better

About the same

Gotten worse



R4020112/14

44%

45%

52%

54%

4%

1%



Figure 16


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Previous Next

Which of the following best describes your job title?

10%

10%

5%

4%

31%

4%

36%

Job Title

Data: InformationWeek 2012 State of Cloud Computing Survey of 511 business technology professionals at organizationswith 50 or more employees, December 2011

R4020112/17

IT director/manager

IT/IS staff

IT executive management (C-level/VP)

Line-of-business management

Non-IT executive management (C-level/VP)

Consultant

Other



Figure 17


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Previous Next

Which of the following dollar ranges includes the annual revenue of your entire organization?

15% 11%

11%

9%

4%

14%

11%17%

8%

Company Revenue


R4020112/18

$50 million to $99.9 million



$1 billion to $4.9 billion


Less than $6 million

Dont know/decline to say

Government/nonprofit

$5 billion or more



Figure 18


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Previous Next

What is your organizations primary industry?

Industry

Construction/engineer

ing

Consultingandbusinessservices

Education

Electronics

Financialservices

Food/beverage

Government

Healthcare/medical

ITvendors

Logistics/transportatio

n

Manufacturing/industrial,noncomputer

Media/entertainment

Nonprofit

Retail/e-commerce

Telecommunications/ISPs

Utilities

Other

Data: InformationWeek 2012 State of Cloud Computing Survey of 511 business technology professionals at organizations with 50 or more employees, December 2011 R4020112/19

2%

5%

11%

2%

12%

2%

12%

7%

6%

3%

10%

2%

3%

2%

4%

2%

15%



Figure 19


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Previous Next

Approximately how many employees are in your organization?

3% 26%

9%

10%

28%

24%

Company Size


R4020112/20

100-499

500-999

1,000-4,999

50-99

10,000 or more

5,000-9,999



Figure 20

P i
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