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Digital Transformation

The Future of Cloud Computing: 5 Trends You Must Know About

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What Is the Future of Cloud Computing?

Cloud computing has grown into a major paradigm in the tech world. It enables ubiquitous and simple on-demand access to shared computing resources via configurable Internet services.

With businesses progressing faster toward digital transformation, many are looking for ways to improve their business continuity, agile processes, scalability, and profits. Cloud computing technologies will likely remain at the core of any business strategy, providing the necessary connectivity and flexibility to keep up with evolving standards.

In this article:

The History of Cloud Computing

The concept of cloud computing has its roots in the 1950s and 1960s, although it has since undergone major evolutions. Businesses first started using mainframes in the 1950s, but computers were expensive, and it was impractical for all users to have their own machines. Therefore, companies introduced the concept of time-sharing to make more efficient use of the valuable processor time on central mainframes.

Time-sharing allowed users to simultaneously access multiple instances of a computer mainframe to maximize processing power and minimize downtime. This technique is the first instance of sharing computing resources and forms the basis of cloud computing today.

The origins of the use of global networks to provide computing resources are almost always attributed to the American computer scientist J.C.R. Licklider, who helped build the Advanced Research Projects Agency Network, a forerunner to the Internet. Licklider aimed to connect computers worldwide, giving users access to data and programs from anywhere.

Cloud computing began to take a more recognizable shape with the introduction of the first virtual machines in the 1970s. These virtual machines allowed users to run multiple computing systems on a single physical machine. Their capabilities led to the concept of virtualization and had a great impact on the evolution of cloud computing.

In the 1970s and 1980s, the leading tech companies Microsoft, Apple, and IBM pioneered technologies that improved cloud environments and promoted the use of cloud server hosting. Salesforce was the first company in 1999 to provide access to business applications via its website.

Amazon launched AWS in 2006 to provide cloud computing and storage services. Since then, other major technology companies, including Microsoft and Google, have launched their cloud products to compete with AWS.

Cloud Computing Adoption Trends

According to Gartner, global spending on public cloud products is growing at an annual rate of 20.4% and is likely to reach $600 billion in 2023.

Gartner projects that end-user spending on Infrastructure as a Service (IaaS) is growing at 30.6% year-over-year. The growth forecast is 26.6% for Desktop as a Service (DaaS) and 26.1% for Platform as a Service (PaaS). The increasing trend of hybrid work is driving organizations to spend an estimated $2.6 billion per annum on their cloud migration efforts.

Companies that recently provided employees with traditional client computing solutions such as workstations and other physical office tools are now moving to DaaS offerings. PaaS spending will likely increase to $109.6 billion, given end-user demand for cloud native capabilities.

According to Gartner, by 2025, IT spending on public cloud services will exceed traditional IT spending. Gartner’s “Cloud Shift” survey only covers segments of the IT market that can migrate to the cloud. These areas include application and infrastructure software, business processes, and system infrastructure.

51% of IT spending in these markets will go toward public cloud solutions by 2025, up from 41% in 2022. 65.9% of application software spending will go towards the cloud in 2025, increasing from 57.7% in 2022.

The cloud is a major enabling technology for digital transformation. Learn about other digital transformation technologies.

Cloud Computing Future Trends

1. Quantum Computing

Quantum computing is changing the business world in unprecedented ways. Companies like Google promote innovation by leveraging quantum physics principles to develop next-generation end-user products. Supercomputers are the best example of how quantum computing works when used correctly. Companies such as IBM, Microsoft, Google, and AWS compete by adapting to the emerging quantum technologies.

Quantum computers employ the principles of quantum physics to enable complex algorithmic calculations and process large data sets in a short amount of time. A supercomputer can provide powerful encryption capabilities for electronic communications and increase network security.

Financial institutions can leverage quantum computing to speed up their transaction processes. This approach saves time and increases process efficiency. Quantum computers store data in qubits, a simpler form of data that speeds up processing. Quantum computing also reduces the additional cost of creating new resources to handle pre-optimized tasks.

2. Edge Computing

Cloud providers are moving closer to the edge to respond to the growth of 5G, Internet of Things (IoT) devices, and latency-sensitive applications. Edge computing is not new to the tech industry glossary, but companies are increasingly adopting it.

Although data centers are built to store large amounts of information in one centralized location, half of the global population lives in rural areas. Edge computing allows systems to become increasingly distributed, bringing data and processing closer to users. This approach reduces latency, cuts bandwidth costs, and improves connection performance.

3. Secure Access Service Edge (SASE)

As employees access more services and data from devices outside of corporate IT networks, businesses are reevaluating their security and risk management strategies. Gartner coined the term Secure Access Service Edge to refer to a cloud-based IT security approach that addresses the changeability of work processes.

Companies using SASE can benefit from cloud-based network security services such as security gateways, firewalls, and zero-trust network access (ZTNA). SASE is a robust architecture that gives businesses peace of mind, allowing them to deliver new services quickly and securely through the cloud.

4. Cloud Regions

The geopolitical fragmentation of regulations, trade protectionism, and industry standards create new, separate compliance ecosystems. Vertical and regional data services and cloud ecosystems are undergoing a consolidation process.

Cloud customers seek to reduce lock-in and single points of failure by using cloud providers outside their country. Some regions simply do not have a sufficient local supply of platform services. This is leading to cooperative legislation that regulates how cloud services will be exchanged across borders.

For example, initiatives like GAIA-X have emerged in European countries due to growing concerns among technology providers, politicians, and researchers.

5. Green Cloud

The extensive infrastructure, electricity, and cooling required for cloud computing significantly increase a business's environmental impact. The US Department of Energy found that data centers consume 2% of the total electricity used in the United States. The average data center uses between 10 and 50 times more energy per floor than a typical commercial office building.

Cloud providers are constantly looking for ways to increase hardware and software efficiency. Even small changes and improvements here can yield significant energy savings in the long run. E-waste is also a problem, as aging hardware produces millions of tons of waste each year.

Shortages in the rare earth mineral market and disruptions in supply chains are driving the demand for improved computer hardware recycling. Responsible business owners recognize their role in tackling climate change and take these factors seriously when discussing on-premises data centers and cloud computing.

Cloud Migration with Cloud Volumes ONTAP

Cloud computing is at the core of digital transformation, elevating it from the adoption stage of digital technology to include also the tools, rebuilding process, and the experience of a virtual environment that is accessible from anywhere. In order for an organization to achieve its goals and secure future viability, it needs to adopt a cloud-first or hybrid cloud management strategy.

NetApp Cloud Volumes ONTAP, the leading enterprise-grade storage management solution, delivers secure, proven storage management services on AWS, Azure and Google Cloud. Cloud Volumes ONTAP capacity can scale into the petabytes, and it supports various use cases such as file services, databases, DevOps or any other enterprise workload, with a strong set of features including high availability, data protection, storage efficiencies, Kubernetes integration, and more.

NetApp and Cloud Volumes ONTAP play a key role in the cloud transformation process, helping enterprises move workloads and data to the cloud securely, manage them efficiently, and integrate them with modern cloud technologies. This frees the organizations from the burden of managing large-scale storage infrastructure and allows them to focus on their core business.

In particular, Cloud Volumes ONTAP assists with cloud migration in digital transformation projects. Learn more about how Cloud Volumes ONTAP helps with lift and shift cloud migration.

Read how Cloud Volumes ONTAP helps customers in these Cloud Migration Case Studies.

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Yifat Perry, Product Marketing Lead

Product Marketing Lead