To say the IT market is going through a transformative period would be an understatement. Yes, cloud computing is changing the way businesses and individuals purchase and consume technology. Yes, consumerization and BYOD (bring your own device) are mashing together personal and business data and applications on the same devices. And yes, mobility via smartphones, tablets and, soon, ultralight notebooks is making accessibility to applications and data universal.

While much of the market calls cloud, consumerization and mobility “transformative trends,” they’re equally characteristic of a larger movement around “comprehensive productivity.” And what business couldn’t use a little boost in output? Businesses and their employees are searching for ways to remain connected, collaborate, and share data while simultaneously having complete access to their personal digital life. Consumerization is the trend driving the convergence of business and personal digital lives, but the trends of cloud computing and mobility are truly enabling consumerization.

To grasp how this is impacting small and mid-size businesses, Spiceworks conducted a study with 323 users across North America and EMEA to find out how the cloud is effecting three business applications that influence employee productivity: file sharing/storage, email and productivity suites. Spiceworks is the world’s largest social business network for IT pros that offers free network management software coupled with an active community for discussion around all things IT. In 2011 alone IT professionals spent almost three billion minutes in Spiceworks, making it one of the most active sites in the IT industry.

The Spiceworks Cloud Barometer:Insights into how small and mid-size companies use cloud services to support file sharing, email and productivity applications.

A Spiceworks Market Insights Report sponsored by EMC

EMC on Spiceworks

July 2012Voice of IT TM

Migration to the Cloud(Based on companies using the cloud today or in the next 6 months)

File Sharing

File Sharing

Email

ProductivitySuites

Use Today

Email ProductivitySuites

52%

52%

42% 6%

6%14%

9%

9%

42%

6%

14%6%

0%

0% 20% 40% 60% 80%

10%

20%

30%

40%

50%

60%

70% 71%

61%

48%

48%

20%

20%

Plan to use in next 6 months

Use cloud today

Plan to use cloud in next 6 months

Migration to the cloud

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THE SPICEWORKS CLOUD BAROMETER

Overall, the findings show that productivity is a powerful lure. Cloud apps are in demand that reduce burdens on internal IT management while simultaneously enabling access to data and applications wherever and whenever users want. But SMBs struggle to find the best way to implement cloud-based solutions while maintaining their principles around data control and security.

While both North American and EMEA companies have fairly similar usage rates across all of the cloud-services measured, North America leads the way in each category.

File Sharing

Use Cloud Today 52% 53% 49%

Total North America EMEA

Email

Use Cloud Today 42% 43% 37%

Total North America EMEA

Productivity Suites

Use Cloud Today 14% 15% 13%

Total North America EMEA

0%

10%

20%

30%

40%

50%

60%

52% 53%49%

42% 43%37%

14% 15% 13%

File Sharing Email Productivity Suites

Total North America EMEA

Usage of the cloud today by region

* Based on companies using the cloud today

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THE SPICEWORKS CLOUD BAROMETER

Cloud-based file sharing: the employee-driven appUsers want access to data whenever they want and from whatever device is in their hands. To facilitate universal data, a broad field of innovative cloud-based companies has popped up across the landscape under the monikers of file-sharing, file synchronization and content management services. They all share the same basic characteristics: allowing users to store and back up unstructured data files (text, audio, video, images) in the cloud and making this data available on demand via any Web-compatible device.

Over half of respondents state they’re using cloud-based file sharing services in their organization today and there’s a distinct possibility every business has some level of file-sharing activity since employees can bring these services in through the front door. This is true for 33% of respondents who state they know their employees are using these services on their own and without approval. Another 5% are not sure what their employees are doing. IT departments are mixed on how to manage this behavior with 31% of companies allowing employees to use any provider they wish and another 32% discouraging the behavior at some level. This reluctance to implement policy indicates that employees and businesses want so badly to see the productivity benefits of file sharing that they might loosen their standard around security, access control and data management.

By region, North American companies are more likely to have an approved vendor for file sharing (25% vs. 12% for EMEA), while EMEA companies are more likely to have employees using file sharing services on their own (37% vs. 27% in North America).

Yes, they are using them on their own

Nope, but planning to implement these services in

the next 6 months

Nope

Not Sure

Yes, and we have an approved vendor

Do your employees use any cloud-based �le sharing services?

33%

19%

9%

35%

5%

How does your IT department manage employee usage of cloud-based

�le sharing services?

31%

12%25%

24%

8%

We allow employees to use any provider they wish

We allow employees to use any provider, but we monitor bandwidth

We allow employees to use only those providers approved by the IT department

We discourage this behavior, but do not monitor it

We strongly discourage employees using these services in the o�ce

“ “

FROM THE COMMUNITY

I tend to give more leeway to some users if (file sharing) will make their work-life a little easier without negatively impacting the company.

Darko1884Spiceworks Usercommunity.spiceworks.com

Company use and management of file sharing services

284 Respondents 89 Respondents

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THE SPICEWORKS CLOUD BAROMETER

While accessibility, collaboration and convenience are the top advantages gained from cloud-based file sharing, businesses often feel insecure about the data that’s being passed through these services. This is why the lack of control over data and security, legal liabilities and compliance issues, and reliability are the top three concerns businesses harbor over file sharing. Only 6% have no concerns about file-sharing services. While many file-sharing companies tout the security of their services and how protection of data is paramount, they still operate in the public domain and are not impenetrable to hackers and malware.

0%

10%

20%

30%

40%

50%

60%

70%

80%

What do you believe are the primary advantages of cloud-based �le sharing services? (Select top 3.)

Accessibility

from anywhere

76%

Collaboration/

sharing capabilities

51%

Convenience

36%

Backupfeatures

32%

Lower cost

25%

Ease ofuse/interface

19%

Security

14%

Storagefeatures

12%

Other,please specify

3%

I don’t see

any advantages

2%

0%

10%

20%

30%

40%

50%

60%

70%

80%

What concerns does your company have with cloud-based le sharing services? (Select top 3.)

Lack of control

around data/

security issues

73%

Legal liability/

compliance

49%

Reliability

48%

Management

headache

36%

Escalating or

unexpected costs

24%

Other,please specify

4%

We don’t have

any concerns

6%

Advantage and concerns with cloud-based file sharing

159 Respondents

156 Respondents

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THE SPICEWORKS CLOUD BAROMETER

When it comes to the selection of cloud-based file sharing providers, employees play an essential role. Employees have a clear preference for Dropbox with 87% of IT pros stating this is the vendor their employees are using on their own. But vendor preference among IT pros isn’t quite as clear. While Dropbox leads the way with nearly 30% of companies stating they use or plan to use them as their approved vendor, nearly 40% are using a file sharing provider in the “other” category. This fragmentation among IT pros indicates that there’s no one solution that’s accurately addressing the concerns of the IT department.

Overall there’s a clear desire for cloud-based file sharing services by small and mid-size businesses and their employees. But it’s evident, from the IT perspective, that the playing field for this category remains open and no one vendor has emerged as the clear leader for this service. Therefore vendors need to find the right solution that addresses companies’ concerns around security, compliance and reliability while giving them what they want: complete accessibility, collaboration and low cost. Otherwise the employee rather than the IT pro may be choosing the winner in this category.

“ “

FROM THE COMMUNITY

I love Dropbox and use it daily for my personal files. That being said I still have some concerns with corporate data being in aDropbox account.

IT FreakSpiceworks Usercommunity.spiceworks.com

Cloud-based file sharing vendor preference

Employee PreferenceWhich cloud-based �le sharing

vendors are your employees using? (Select all that apply)

IT Pro PreferenceWhat provider did you select or are you

most likely to select to support cloud-based �le sharing for your

company? (Select only one)

Dropbox 87%

Box 8% Box 10%

Egnyte 0% Egnyte 8%

TrendMicro 0% Trend

Micro 6%

Other 20% Other 37%

Don’tknow 11%

Dropbox 28%

93 Respondents 71 Respondents

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THE SPICEWORKS CLOUD BAROMETER

Email: onward movement up to the cloud, but on-premise still leadsWhen it comes to email, productivity improvement is the goal. The pursuit of productivity, though, is different from that of file sharing, mostly because of the nature of email systems and how they’re bound to a brand and domain. For that reason, businesses must sponsor their email system, whether it’s on-premise or hosted.

Hosted email offers the advantages of accessibility, scalable storage, management, administration and security. This explains why 42% of companies have moved to a hosted email solution and another 6% plan to migrate in the next 6 months. These companies are most attracted to relieving administrative burdens for their IT staff and the service’s ease of deployment. Surprisingly, security, storage and backup features are not rated as the top motivating factors for implementing a hosted solution.

By region, North American companies are slightly more likely to have a hosted solution vs. EMEA companies with 43% vs. 37% currently using a hosted solution.

Is your company’s email solution currently hosted or on-premise?

Currently on-premise, but plan to move to a hosted solution within the next 6 months

0%

10%

20%

30%

40%

50%

60%

What are the primary reasons for moving your company’s email to a hosted solution? (Select top 3).

On-Premise Currently Hosted

52% 42% 6%

Reduces burden on

IT sta�

56%

Ease of deployment

46%

Accessibility to email

at anytime

46%

Lower cost per user

32%

Security

22%

Backup features

21%

Storage features

18%

Cost structure

16%

Customer support

7%Other,

please specify

7%Don’t know

4%

Hosted email adoption and reasons for migration

262 Respondents

112 Respondents

FROM THE COMMUNITY

SpiceList*: How do you feel about hosted email?

#1 I love on-site Exchange

#2 I’m not convinced about outsourcing

#3 I’m already hosting and happy with my provider

#4 Considering moving, but waiting for the right time

#5 I’m looking to switch from on-site to hosted

* A SpiceList tells you what IT pros in the Spiceworks Community think about a particular issue.

For a complete list click here.

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THE SPICEWORKS CLOUD BAROMETER

Microsoft dominates the on-premise email market with Exchange but in terms of cloud-based email service providers Google leads the way followed by Office 365. The almost 40% using “other” providers reflects the broad availability of POP3 and Exchange email services through service providers.

When selecting a hosted email service provider, reliability dwarfs all other considerations, including security and lowering costs. This deference speaks to the desire for improved productivity. Email outages can cause significant business and revenue disruptions. Businesses often elect to retain their on-premise email because it gives them greater control over operations, information flow, security and support.

0%

10%

20%

30%

40%

50%

60%

70%

80%

What are the primary considerations when choosing the vendor for your company’s hosted email solution? (Select top 3.)

Reliability/24/7 uptime

Security meets

our standards

Lowest cost

per user

Ease of deployment

Cost structure

Customer support

Backup features

Storage features

Other(please specify)

75%

46%40% 38%

22%17% 17%

11% 9%

What vendor are you using or looking to use to support your company’s hosted email solution? (Select only one.)

34% 16% 4% 3% 3% 40%

O�ce 365 Go Daddy

Google Rackspace Intermedia Other

Hosted email vendor preference

Top selection criteria for hosted email vendors

116 Respondents

113 Respondents

While hosted email is seen as a means for reducing IT burdens and increasing productivity, it’s still not the preferred model. The survey revealed that 58% of businesses surveyed are currently using on-premise email, and only 6% of them will migrate to cloud-based email in the next 6 months. That makes for a huge base of potential customers to convert, provided a service provider can clearly demonstrate reliability, security and cost-containment.

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THE SPICEWORKS CLOUD BAROMETER

Cloud-based productivity suites: the jury’s still outWhen it comes to moving productivity suites to the cloud, which include word processing, spreadsheet and calendar applications, adoption is slow among SMBs. Cloud-based productivity suites have the lowest adoption rate among the three applications reviewed in this study. Nearly two out of three businesses have no plans to use cloud-based productivity suites. Only 14% of those surveyed are currently using cloud-based productivity suites, and another 22% are thinking about adopting these services sometime in the future.

North American companies are marginally more likely to adopt cloud-based productivity suites, with 38% currently using or planning to adopt vs. 30% of EMEA companies.

Does your company use or plan to use any cloud-based productivity suites for word processing, spreadsheets, etc.?

Yes, within the next 6 months Yes Yes, but not sure when

64%6%14% 15%

Nope

What vendor are you using or thinking about using for your cloud-based productivity suite? (Select only one)

Other (please specify)Google Apps O�ce 365

48% 43% 8%Does your company use or plan to use any cloud-based productivity suites for word processing, spreadsheets, etc.?

Yes, within the next 6 months Yes Yes, but not sure when

64%6%14% 15%

Nope

What vendor are you using or thinking about using for your cloud-based productivity suite? (Select only one)

Other (please specify)Google Apps O�ce 365

48% 43% 8%

This low adoption rate is consistent with other industry research: According to the Cloud & Technology Transformation Alliance’s 2012 State of the Cloud Channel1 report, demand for cloud-based productivity increased a scant 6% compared to 22.5% for cloud backup and 23% for cloud storage.

When it comes to cloud productivity suites, there are only a handful of choices beyond the two market leaders, Microsoft and Google. This explains the polarity between Google Apps and Office 365. Google has surprised many with its ability to grow market share in an application segment dominated by Microsoft. Still, it’s not all that surprising given that Google is, by its very nature, a cloud native.

FROM THE COMMUNITY

Over 60,000 IT pros are following Office 365 or Google Apps in the Spiceworks Community.

community.spiceworks.com

Adoption of cloud-based productivity suites

Cloud-based productivity suites vendor preference

247 Respondents

83 Respondents

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THE SPICEWORKS CLOUD BAROMETER

The adoption rationale and the purchasing considerations for cloud productivity suites virtually mirror each other, with ubiquitous accessibility, collaboration features, and lower cost topping the list. Cost savings is a secondary consideration, but significant since cloud-based productivity suites typically have a lower acquisition cost but a longer total cost of ownership given their open-ended recurring subscription fees.

0%

10%

20%

30%

40%

50%

60%

70%

Why have you moved or plan to move to a cloud-based productivity suite solution for your company (Select top 3.)

Accessibility from

anyhwere

Collaboration/

sharing capabilities

Lower cost

per user

Easier to keep

everyone up to date

Backup features

Ease of use/

interface

Storage features

Security meets

our standards

Employees are

already using them

Other(please specify)

2%7%

20%21%24%25%30%

37%

54%

69%

0%

10%

20%

30%

40%

50%

What are your company’s top considerations for selecting your cloud-based productivity suite vendor? (Select top 3.)

Accessibility from

anywhere

Compatibility

Collaboration/

sharing capabilities

Lower cost per user

We’ve worked with

the company before

Ease of use/

interface

Security meets

our standards

Backup features

Storage features

Employees are

already using them

Other(Please specify)

2%12%

14%15%16%

31%31%33%

42%43%44%

Top reasons for migration and vendor selection criteria for cloud-based productivity suites

84 Respondents

81 Respondents

1 0

THE SPICEWORKS CLOUD BAROMETER

Given that current vendor preference in this category is essentially a horse race between Google and Microsoft, it’ll be interesting to see how adoption trends continue as Microsoft dives deeper into mobile platforms and lightweight endpoint devices powered by Windows 8 and Windows Phone 8. It’ll also be intriguing to watch how Google continues to challenge Microsoft with the release of new versions of its operating system Chrome, flavors of the Android operating system, and hardware such as Chromebooks and the new Nexus 7 tablet.

Wrapping UpThe core tenets of cloud computing are scalability, elasticity, flexibility, accessibility and cost containment – all of which add up to greater productivity. Cloud-based applications such as file sharing, email and productivity suites are proving tremendously adept at producing the tangible results desired by business, particularly by SMB and midmarket companies. However, concerns and objections to these cloud services persist. Security, reliability and true-value doubts will hinder adoption as on-premise applications prove exceedingly resilient despite not having the same levels of accessibility and ubiquity. Nevertheless, the draw to cloud apps is evident with file sharing leading the charge. As a mechanism for moving around documents with greater efficiency, file sharing extends the value and usability of on-premise applications such as email and productivity suites.

Cloud-based applications such as file sharing, email and productivity applications will only become more appealing as their reliability and usability increases. Businesses will continue to expand their use of these services as they search for applications and resources that reduce overhead costs while increasing productivity and output.

This report was sponsored by EMC.

EMC Corporation is a global leader in enabling businesses and service providers to transform their operations and deliver IT as a service. Fundamental to this transformation is cloud computing. Through innovative products and services, EMC accelerates the journey to cloud computing, helping IT departments to store, manage, protect and analyze their most valuable asset — information — in a more agile, trusted and cost-efficient way.

Additional information about EMC can be found at www.EMC.com.

1 1

THE SPICEWORKS CLOUD BAROMETER

References

1 2012 State of the Cloud Channel, Cloud & Technology Transformation Alliance (The 2112 Group and Virgo Publishing), March 2012

The contents in this report are a result of primary research performed by Spiceworks. Unless otherwise noted, the entire contents distributed as part of this report are copyrighted by Spiceworks. As such any information made available by any means in this report may not be copied, reproduced, duplicated, published, displayed, transmitted, distributed, given, sold, traded, resold, marketed, offered for sale, modified to create derivative works or otherwise exploited for valuable consideration without prior written consent by Spiceworks. For more information visit www.spiceworks.com/voice-of-it/terms.

This report contains information of fact relating to parties other than Spiceworks. Although the information have been obtained from, and are based on sources that Spiceworks believes to be reliable, Spiceworks does not guarantee the accuracy, and any such information might be incomplete or condensed. Any estimates included in this report constitute Spiceworks’ judgment as of the date of compilation, and are subject to change without notice. This report is for information purposes only. All responsibility for any interpretations or actions based on the information or commentary contained within this report lie solely with the recipient.

All rights reserved. 2012.

About Spiceworks Voice of IT®

The Spiceworks Voice of IT® market Insights program publishes stats, trends and opinions collected from small and medium business technology professionals that are among the more than 2M users of Spiceworks. Survey panelists opt-in to answer questions on technology trends important to them.

About Spiceworks™

Spiceworks™, the world’s largest social business platform for IT, connects 2 million IT professionals with more than 1,200 technology brands. By combining a Facebook-like community with free IT management software, Spiceworks helps businesses to discover, buy and manage $350 billion worth of technology products and services each year.

To learn more, visit: Be first to hear about Spiceworks Voice of IT® insights, email:http://www.spiceworks.com/voice-of-it marketresearch@spiceworks.com

Industry

Other

1-9 employees

44%20-99 employees

32%100-249 employees

18%250+ employees

7%

31%

IT Service Provider

IT Service Provider

1-19 employees

250+ employees

100-249 employees

20-99 employees

17%

Education10%

Manufacturing8%

Healthcare7%

Retail6%

Finance

5%

5%

Engineering

5% Non-Pro�t

4% Software

Consulting3%

Respondent Pro�leIndustry

Company Size Region

Manufacturing Retail Engineering Software Other

Education Healthcare Finance Non-Pro�t Consulting

17% 10% 8% 7% 6% 5% 5% 5% 4% 3% 31%

44%

32%

18%7%

NorthAmerica

52% 48%

EMEA

Sample = 281Sample = 282

Sample = 259