The short answer if you're talking to the CFO is that there are NONE. The short answer if you're talking to the CEO is your USERS. Either way it's a good thing for Business.
Confused? Although SaaS, Iaas and Private Clouds (the Holy Trinity of cheaper IT) have been on a growth blitz for the past several years, total IT spending has still increased. So if the Cloud is not reducing IT run-rates overall where did all the Cloud Saves go?
SaaS: Loving the long Tail.
SaaS is supposed to be cheaper. Saas is growing faster than traditional software. So why is the application software market still growing and growing bigger than the gains from SaaS adoption? Because so far SaaS hasn't cannabilized on-premise investments, SaaS has been loving the long-tail - SMBs.
Take a look at the SaaS poster-child. Over the past few years they have impressively doubled their customer base - during this time the "old guard" grew revenues also. But as SaaS has expanded from SFA to Customer Support to Paas to Social Enterprise the average revenue per customer has been falling. This is because Saas is largely mining the long-tail of the market. The previously neglected users that couldn't overcome the Capex hurdle of traditional licensing models.
New Users get access to valuable software, but no material Cloud saves.
IAAS: Early days.
Less than 2% of workloads. Let's revisit in 10 years.
Private Clouds: Foundations of Modern applications.
Last year virtual workloads installed grew greater than 20%+. Obviously this was not driven purely by business growth. At the same time Data Center hardware spending basically stayed flat while Infrastructure software revenues went on a tear. So where did the cost advantages of virtual infrastructure go?
Capital starved organizations spent their virtual capacity on two fronts - modernizing development and business continuity environments. At first glance this could appear selfish. Highly virtualized IT shops reduced their own backlogs anywhere up to 15% while their ratio of IT spend to revenue held higher than their under-virtualized peers.
Not so selfish. As it turns out these were smart investments in the foundations of modern applications. Investments that have delivered returns quickly. In the past 2 years these same IT shops have achieved 20%+ improvements in application provisioning speed and mission critical uptime. Both areas a boon for Users.
The formula for Private Clouds is simple - speed times stabiity equals USER productivity. And the proof is in the pudding. User productivity (as measured by revenue per employee) for highly virtualized organizations is 1.3 times greater than virtualization laggards. This is a huge difference.
Again, no material reduction in overall IT spending but USERS are the big winners.
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