Worldwide spending on industry cloud services in the finance sector – such as banking, insurance, securities and investment services – is expected to reach $3.2 billion in 2017, according to the latest market study by International Data Corporation (IDC).

Furthermore, IDC expects the amount to more than double in 2021, amassing total worldwide spending of $7.2 billion.

Industry cloud market development

The manufacturing industry (both discrete and process combined) was a larger spender on industry cloud though, relative to its finance counterpart. This industry is expected to spend $4.2 billion in 2017 and achieve year-over-year growth of 23 percent in 2018. Similar to the finance industry, the manufacturing industry is also set to double its 2017 spending in 2021, reaching a total of $9.2 billion.

However, IDC forecasts healthcare providers across the world will spend a total of $8.9 billion in adopting industry cloud solutions during 2017. This industry is expected to increase spending by 20 percent year-over-year in 2018 on industry cloud solutions – by 2021, that's a staggering $17.6 billion.

On a geographic basis, the United States leads by a very large margin in terms of industry cloud adoption across the three aforementioned industries combined. It's expected to reach 73 percent of worldwide spend in 2017, followed by Western Europe at 12 percent.

The U.S. is also forecast to grow 20 percent year-over-year in 2018 while the other regions are expected to achieve 27 percent annual growth during the same period. The three industries are expected to spend a total of $330 million on industry cloud solutions in China in 2018, representing very strong growth of 39 percent year-over-year.

"The industry cloud market is young, yet growing fast, with double-digit growth expected to continue for at least the next five to ten years. Dozens of new industry collaborative clouds are emerging each year, helping to foster digital transformation, streamline industry value chains, and ultimately drive innovation, while most software vendors are also shifting their portfolios to focus more heavily on designing industry cloud solutions," said Eric Newmark, program vice president at IDC.

Outlook for vertical industry cloud growth

Healthcare continues to lead the charge from a vertical standpoint, but many industries have picked up momentum, including manufacturing, financial services, and even government.

Though the market's tipping point is still a few years away, IDC believes the industry cloud market represents one of the largest vertical growth opportunities for technology and professional services firms through 2025.

According to the IDC assessment, IT vendors who become strategic suppliers to a successful industry cloud win the business of not just that one organization, but of that customer's entire digital ecosystem.

“There’s plenty of bandwidth out there but it’s never in the right place. So what Cedexis does is uses data to work out the best pathways to get data from the origin to the person who wants to get it,” explained Simon Jones, Evangelist and Head of Marketing at Cedexis, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.

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Enterprises are moving to the cloud faster than most of us in security expected. CIOs are going from 0 to 100 in cloud adoption and leaving security teams in the dust. Once cloud is part of an enterprise stack, it’s unclear who has responsibility for the protection of applications, services, and data.
When cloud breaches occur, whether active compromise or a publicly accessible database, the blame must fall on both service providers and users.
In his session at 21st Cloud Expo, Ben Johnson, Co-Founder and CTO of Obsidian Security, explored how both groups must do more to make cloud more secure, from leveraging AI to improving APIs, to incorporating cloud into current security programs.

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Bitcoins are a digital cryptocurrency and have been around since 2009. As a substitute for legal tender, they are becoming the rage for investors and others but because there is no government agency auditing or performing regulatory oversights, you wonder if it is the perfect breeding ground for electronic nanocrime.
Since the introduction of the Bitcoin, some competitors have emerged and the whole segment of cryptocurrencies are defined as Altcoins. Altcoins include Dogecoin, Ethereum Feathercoin, Litecoin, Novacoin, Peercoin, and Zetacoin. Some of these cryptocurrencies are considered improvements on the original Bitcoin algorithm structure, and they are gaining some traction as well.

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Two pieces of research have hit CloudTech HQ, both examining how the security of data is perceived – and which data is more private than others.

Information security provider Trustwave, in its ‘Value of Data Report’ published today, aimed to look at which data was most important to the 500 IT decision makers polled across five countries. On average, the per capita value of personally identifiable information (PII) in the US is more than double that of the UK – $1,820 and $843 respectively. The UK ended up having scantest regard for their data, behind Australia ($1,186), Japan ($1.040) and Canada ($1,025) respectively.

What’s more, PII is of greater import than all other types of data – in most sectors, anyway. 47% of respondents cited it as a high priority, compared with intellectual property (27%), payment card data (18%), with corporate email (6%) bringing up the rear. Healthcare and hospitality give the biggest priority to PII data, with average scores of 3.5 and 3.4 out of four respectively, while industrial companies and IT firms rank IP as most important.

Given this around how fiercely protected certain types of data are, findings from Kaspersky in another report released today make for particularly interesting reading. Polling more than 2,000 IT decision makers across Europe in organisations with more than 50 employees, fewer than three in five (55%) of respondents believe companies are looking after their personal data properly.

Almost three quarters (73%) said the security of their private data was important, while 67% admitted they were concerned about their information being hacked. A similar number (64%) said they were worried about how many organisations have access to their personal information.

Again, the UK does not come out in the best light when it comes to data security. Only 56% of IT decision makers trust organisations to keep hold of their data – a meagre number when compared to their equivalents in France (76%), but a little better than Germany (48%).

Both studies cited the importance of the upcoming General Data Protection Regulation (GDPR) – an issue which this publication has covered in chapter and verse – in their findings. “Companies that fail to accurately value their data are unlikely to make the right decisions regarding the level of cyber security investments to protect that data and are those most likely to fall short of regulations, such as the GDPR coming into effect in 2018,” commented Ziv Mador, vice president of security research at Trustwave.

“Businesses should look to the managed security services business model so that they have the confidence that full data risk vigilance is applied to all types of confidential and valuable data by specialists in the industry.”

More evidence – as if it were needed – that Alibaba is serious about taking its cloud arm into new geographies: the company has announced compliance accreditation with Germany’s federal office for information security.

The C5 attestation – so called because its full natty title is the Cloud Computing Compliance Controls Catalogue – with additional requirements covers Alibaba’s elastic compute service, relational database, object storage, CDN, load balancer, virtual private cloud and security offerings.

The German federal office, the Bundesamt für Sicherheit in der Informationstechnik (BSI), outlines the C5 criteria thus (pdf), noting already established standards such as the ISO/IEC 27001 and 27017: “Among security experts and cloud service providers exists an informal consensus about the requirements that have to be met for secure cloud computing. A generally recognised requirements (or controls) catalogue on this, however, is not available yet. The present [C5] is intended to be an aid for the customer providing a better overview for a higher level of security and avoiding redundant audits.”

Only five cloud service providers are C5 accredited – AWS and Microsoft being among them – while Alibaba says it it’s the first company to be accredited with additional requirements.

“Alibaba Cloud is fully committed to the highest standards in all aspects of our operations no matter where that might be in the world,” said Simon Hu, Alibaba SVP and president of Alibaba Cloud in a statement. “We are proud to be the first company to meet the C5 additional requirements – something that should increase the trust placed in us by our growing client base not only in Germany, but also across the whole of Europe.”

This can be seen as the icing on the cake for a stellar year in Alibaba’s cloud operations. Naturally, its traditional eCommerce strength remains – just the $25 billion generated in sales with Singles Day last month – enabling the cloud arm to fly somewhat under the radar. CEO Daniel Zhang told analysts on an earnings call at the start of November that the cloud business “continues to defy gravity”, with revenues up 99% year on year.

Alongside an expanding partner ecosystem, the company outlined its plans to move from one million cloud customers to 10 million at its Computing Conference in Hangzhou back in October. The previous month, Gartner placed the company in third for public cloud infrastructure as a service.

Multi-cloud continues to be a major trend as we move into 2018 – and according to a new research report from VMware, organisations need to overcome the inherent technical and skill challenges of multi-cloud deployments for success.

Over half (57%) of the more than 1,300 global IT decision makers in large enterprises polled said that technical challenges, as well as the demand for new skills and staff, were unexpected, critical learnings from managing multiple clouds. Integrating legacy systems and understanding the new technology were cited by 62% and 61% of those polled respectively as the toughest challenges in the process.

As the report puts it, if you haven’t started exploring multi-cloud yet, then you’re already behind so you need to start now. What’s more, VMware says, first year progress is particularly demanding, with technical snafus as well as the usual legacy issues. For those between years two and five, patience is the order of the day, although there are some surprising benefits, particularly around security as organisations become more comfortable with cloud technologies. Beyond year six, the report argues, the possibilities are near infinite, combining technologies such as AI and IoT with confident security practices and a cloud-first organisational posture.

As this publication reported last month, research from BMC Software found that organisations are struggling to manage multi-cloud environments. In this instance, BMC advocated exploring AI and machine learning as it can increase automation in the multi-cloud management process. Plenty of market buzz has been around the concept of late too; witness Cisco’s intention to acquire Cmpute.io earlier this month as evidence of that.

“The race to digital transformation is driving the need for global organisations to dramatically speed application delivery, while simultaneously fuelling innovation and becoming more agile in the process,” said Ajay Patel, senior vice president for product development of cloud services at VMware. “With digital business changing how industries operate, organisations are increasingly looking to multiple clouds to support the drive to become more secure, innovative, efficient and agile.

“This study highlights what it takes for a successful multi-cloud approach that not only allows companies to realise the true benefits of the cloud but helps them capitalise on emerging technologies to run a competitive, successful business,” Patel added. “With time, organisations are on a path to reap the full, long term benefits of multi-cloud environments.”

You can find out more about the report here.

Schooling fresh-faced young colleagues about how things used to be in the IT game is a one-way ticket to feeling old. The thing is, with technology trends evolving so rapidly, it could easily be happening to them within 12-18 months from now.

The latest focus is around technologies like augmented reality, artificial intelligence and machine learning that are stretching imaginations yet further for how businesses engage with their customers, people and data. As exciting as each one is, what I’m interested in is how much they affect the data centre.

Those of us with grey hairs will remember data centres being controlled by facilities managers, rather than the IT team. Facilities people, with their utility belts and hi-vis jackets, who know about voltages and tensile strength and reverse-parking caravans in the snow with their eyes closed. Not IT operations people, you realise. Oh no. Nor network architects or – heaven forefend – application programmers.

Today it’s all different of course and – looking back – that switch in ownership marked a significant change; a shift in power base from screwdrivers to software. Today, data centres are the nerve centres of technology enablement. They are the physical manifestation of two buzz phrases that mean a lot in business but are tricky to pin down to anything tangible: ‘cloud’ and ‘digital’.

Many IT folk will be familiar with the term ‘software-defined’, as in a ‘software-defined network’. To my mind, all infrastructure is in fact becoming software-dominated, in one or more of the following three ways:

Being driven to achieve higher performance metrics by increasingly demanding software applications

Want to create an amazing user experience with AR/VR? Or improve business analytics through an army of IoT (Internet of Things) sensors? How about driving AI into your business decision-making? These software applications are going to fundamentally transform the infrastructure required to deliver the necessary responsiveness and agility.

However you orchestrate hybrid cloud resources to achieve your digital objectives, it will boil down to denser, faster, hotter, more scalable and more latency-sensitive infrastructure components marching to your tune.

Being driven by the flexible demands of software to move toward open-standards architecture and away from proprietary hardware

Another legacy of the old ways is to be ‘an IBM house’ or ‘a Cisco house’ etc. In other words – ascribing to the notion that no-one ever got fired for blowing a few million quid on a major global hardware manufacturer’s equipment – being loyal to a given technology brand to build your infrastructure.

Well, I’ve got news for you. Some of the smartest data centre managers see the future as riding Moore’s Law of increasing hardware performance, but without getting locked-in to a single vendor’s proprietary roadmap. They would rather look to a vendor promising that their solutions enable open standards in data centre infrastructure to give software intelligence the best possible environment to achieve their objectives. This often means eschewing the hardware brand leader in favour of commercial-off-the-shelf (COTS) silicon – whatever it takes to avoid being locked down. 

Being increasingly managed and governed by software automation to reduce human error and cost

Funny to think that, having successfully sprinkled its magical business-enabling fairy dust on every other part of an organisation – finance, sales, manufacturing, logistics, marketing, legal – IT has finally got its turn to benefit. For too long, IT management processes have been too manual; too driven by repetitive tasks. The digital revolution has brought a significant improvement here also, introducing better management interfaces and automated processes, thereby creating extra time for IT pros to spend on strategic IT initiatives. Data centres form a major part of the IT management burden of course – particularly with distributed data centre/server room/wiring closet estates – but this is alleviated with the development of more advanced data centre infrastructure management (DCIM) solutions.

History tells us the battle against downtime never ends

Despite all the other advances, downtime is one issue that does not appear to be evolving. If anything, organisations’ new digital agendas have raised the stakes on the importance of ensuring continual uninterrupted uptime. Data centre dependency is at an all-time high. Going slow is unthinkable, let alone going offline.

That’s when I start remembering those much-maligned facilities people (and their utility belts). The truth is, the protection they represent has never gone away. What they lack in sophistication around software, they more than make up with in knowledge and practical value around backup electrical power, balancing cooling loads efficiently, and mitigating environmental risks. When push comes to shove, those are skills worth keeping as close to you as possible.