The 2023 Technology Revolution: Back to Cloud Service Models

By Jon Groves

Jon Groves

Back in 2016, IBM published a blog that ended with these words: “The evolution of cloud computing has only begun. What do you think the future holds for cloud computing?” Another stated that “The golden era of cloud computing is yet to dawn on us.” I’m certain that none of us imagined then that we’d be thrust into the cloud in a major way today.

At the time, we talked to our customers about taking small steps to cloud adoption by moving workloads, such as email. Then we discussed with them how to adopt cloud-first strategies on their journey to digital transformation.

When the global pandemic struck in 2020, it forced workers home to work and IT teams to figure out how to make that happen. The pandemic taught us how to survive by going all in on cloud.

All In on Cloud

Now, we face a triple whammy of uncertainty: ongoing global supply chain disruptions, global talent shortages and now, global inflationary pressures. These will impact countries, markets, and businesses differently, but all will be affected in some way. The question is, will your organization watch and wait … or will you go boldly into the future?

Given what we’ve been through, it might be tempting to sit this one out and rest on the knowledge that we went from zero to 100 over the past couple of years. But I predict that most businesses will not rest. What we’ll see, instead, is a resounding surge of as-a-service models, driven by a more permanent move away from the capital model to an annuity model — not unlike the “mini-surge” in cloud services we saw during the pandemic.

The model for these uncertain times: Public cloud services. For example, we all had video collaboration before the pandemic, but we really accelerated the use of video during the pandemic. The technologies have become infinitely better, making it an essential tool that allows us to collaborate from our laptops instead of driving and/or flying to conference rooms to conduct business. The resulting efficiencies include less travel time, increased productivity, reduced travel costs and — perhaps, one day — fewer meetings.

In the same way, public cloud service models will continue to drive innovation and efficiencies, enabling organizations to not just survive but thrive with agility, scalability and elasticity — even in difficult times.

In fact, global spending on public cloud services is projected to grow from $410 billion in 2021 to nearly $600 billion in 2023. That growth will be driven largely by infrastructure-as-a-service (IaaS), platform-as-a-service (PaaS), and software-as-a-service (SaaS), but all as-a-service models will experience growth. Compare that with two years ago when, in the midst of a global pandemic that drove increased spending on public cloud services, Gartner predicted a much smaller bump in growth — from $243 billion in 2019 to just $305 billion in 2021.

Where the pandemic accelerated the modern hybrid workplace, the “triple whammy” of uncertainty will propel customers to hold back capital and seek out new ways to increase automation and digitalization to reduce cost and risk and increase business efficiencies. They’ll turn to as-a-service models to build a more automated hybrid workplace.

In essence, we will move away from adopting public cloud services as a matter of need to making more thoughtful and intentional decisions about what will make the business more efficient and resilient.

Through surgical use of as-a-service models, business leaders can alleviate staffing issues by automating workflows and business processes. For example, application development, which traditionally requires a high level of skill, can be better accomplished through PaaS where developers have control over and can create and organize applications and data. By contrast, because SaaS applications are controlled by third parties, developers lack the control over applications or data that PaaS enables.

Annuity-Based Services: A Lasting Gift

Going forward, IaaS, PaaS, SaaS, and other cloud service models will continue to be crucial to our clients. For example, we can take something like security — an established need that continues to accelerate and become an even greater necessity for our clients — and create as-a-service solutions to automate tasks, such as threat hunting and remediation. And managed services providers can wrap unique managed services and security expertise around those offerings to help customers alleviate the need for recruiting and retaining high-priced security talent or to refocus their talent on their core business.

The beauty of it for managed services providers is that, once in the cloud, workloads tend to stay in the cloud, generating annuities for the life of the contract. And, by working closely with your clients and helping them to optimize their resources, those workloads tend to stay in the cloud in perpetuity.

Jon Groves is CEO of LogicalisUS, an international IT solution and managed services provider. He drives strategic direction and performance and brings more than 20 years of senior and executive level management experience in sales, consulting and systems engineering. You may follow him on LinkedIn or @LogicalisUS on Twitter.