- Major Studies
- Market Assessments
IT organizations continue to turn to infrastructure as a service (IaaS) as an alternative to on-premises data centers. The technology is now mature and available from a variety of public cloud and private cloud providers. However, as with many maturing technologies, growth is now coming from organizations expanding their use of IaaS, rather than from first-time adopters. The lion’s share of investment comes from companies that already have begun their cloud infrastructure journey and are investing further. Nevertheless, IaaS is not without its risks.
Figure 2 from our full report, IaaS Adoption Trends and Customer Experience, shows that adoption rates and investment rates for IaaS have been steadily increasing. In the past four years, adoption (the blue bars) has risen from 35% of all organizations in 2017 to 56% in 2020. During the same period, the percentage of organizations making new investments in IaaS has risen from 36% in 2017 to 52% in 2020.
IaaS refers to the use of network-based computing resources such as storage and processing without having to manage the underlying technical infrastructure. IaaS can be offered in a public cloud or by cloud platform service providers as a private cloud. IT organizations make use of IaaS for a variety of purposes, including internal production systems, systems development and testing, disaster recovery, customer-facing systems, and handling spikes in demand. The full report outlines the adoption rates for these use-cases. Nevertheless, there are risks.
“As easy as it is to spin up new resources in the cloud, costs can spin up, too,” said Tom Dunlap, director of research for Computer Economics, a service of Avasant Research, based in Los Angeles. “Cloud only works if you have governance around usage. Without discipline in this area, organizations can end up paying for resources that they no longer use.”
In addition to cost risks, security and privacy concerns linger. Some business and IT leaders still raise security and privacy concerns over trusting the public cloud with confidential information. However, research has shown that IaaS providers generally have superior security to what most companies can achieve in-house.
Nevertheless, we anticipate growth in IaaS adoption and investment. It bears watching how high adoption will go in the next few years. The need for more robust disaster recovery plans after the coronavirus pandemic could amplify the adoption.
Based on our survey, this report quantifies the current adoption and investment trends for IaaS, as well as the benefits driving adoption. We assess adoption and investment trends by organization size and sector. We also look at the economics of IaaS by assessing the return on investment (ROI) and total cost of ownership (TCO) experience of those that have adopted IaaS and conclude with practical advice for those seeking to gain support for IaaS investments.