Opportunities in the Cloud as Customers Look Toward Business Growth

By Marco Limena, vice president of Hosting Service Providers, Microsoft Corp.

Today, I will be speaking to more than 350 Microsoft hosting partners as part of our annual Microsoft Hosting Summit. This is one of my favorite activities to participate in, as I enjoy the opportunity to connect with so many leading partners from the hosting industry including Ceryx, Dimension Data, GoDaddy, Rackspace, SilverSky and Triple Cloud – all of whom will be speaking today. We’ll use the event to talk about innovation, how to expand and build new opportunities and how hosting partners and Microsoft can work better together.

One of the things I’ll share during my keynote are some of the latest trends and key drivers of customer cloud adoption taken from “Hosting and Cloud Go Mainstream: 2014,” a Microsoft-commissioned study conducted by 451 Research¹ released today.

The report highlights three key opportunities for hosting partners, and I’d like to go into a little detail about them here:

Customers are interested in cloud to grow their business

It isn’t news that customers are exploring cloud technologies, with cloud momentum continuing to grow. But the survey shows that we have now reached a tipping point, as 45 percent of the companies surveyed have moved beyond the discovery or pilot phase and have a production environment implemented in the cloud, with 32 percent saying they now have a formal cloud computing strategy plan in place. This data highlights a huge opportunity for hosting partners, as there are still a large number of customers that will need their expertise for both moving to the cloud and showing customers how the cloud can drive business growth.

Cloud is a trust business

Security and support is another huge opportunity for partners as customers move to the cloud. Fifty-five percent of customers surveyed said they would pay for premium customer support services from their provider, and 60 percent said they would pay for premium security guarantees if available. Also important, among customers with more than 100 employees, more than 80 percent of cloud solutions are subject to audits with their internal security team. This is proof that cloud changes many things, but for customers, security and support is still important and an area which service providers need to address.

The road to hybrid cloud is private

We often talk about “the road” to cloud deployments, as few customers move completely to the cloud all at once. Customers are looking to hybrid cloud to move their cloud deployments forward, and the survey showed that 26 percent of total on-premises IT spending is now on-prem private cloud, ahead of previous projections. Growth wasn’t limited to on-premises private cloud either—when looking at off-premises infrastructure (hosted dedicated, hosted private cloud and public cloud), hosted private cloud had the highest rate of growth in spending during the last two years, growing from 28 percent to 32 percent. And last, “private to private” (on-premises/hosted) is the dominant hybrid model among 60 percent of hybrid users. The survey results make it clear that hybrid cloud is viewed as a trusted solution for customers and our partners stand to benefit from this trend continuing.

Microsoft and the hosting service provider community are well positioned to thrive in the coming years as we work together to meet the needs of our shared customers. Together, we’ll continue to bring real solutions to help enable customers to leverage the benefits of the cloud while growing their business. I encourage you to visit https://www.microsoft.com/en-us/news/press/2014/mar14/03-19hostingsurveypr.aspx to read more about the study, or you can also visit https://www.microsoft.com/en-us/news/download/presskits/cloud/docs/hostingstudy2014.pdf to view the information directly.

¹451 Research “Hosting and Cloud Go Mainstream,” March 19, 2014.