2013 Cloud Computing Market Projections

There is no doubt that cloud-computing technology is rapidly evolving.  Looking back 12 to 24 months, the industry and our customers were posing the question, “What is cloud computing and will it last?” There is no doubt that our industry has accepted the fact that the cloud is here to stay.  “How can cloud computing help my business?” has now become the most frequently asked question. I am not going to focus on the issues of the past, but rather provide my projections of what is to come in 2013.  Prefacing this by saying that the focus of these projections is based on my interactions with the Small and Medium Business (SMB) market segment.

My predictions for the coming year point to further adoption of cloud computing technology with two initiatives in mind:

1.  A desire to move capital expenditure to operational expenditure
2.  A desire to create revenue-impacting opportunity by leveraging technology

CAP-EX to OP-EX

Many executives in organizations understand that a move to the cloud would result in a migration of substantial capital expenditure to operational expenditure; however there can actually be a reduction of both capital and operational expenditures by moving to the cloud.  The “In-House” model requires CAP-EX, resulting in the purchase of hardware and software, and re-investment of capital every 3 – 5 years to keep up with technology and remain competitive in the market. 

The same applies in this model, requiring OP-EX in systems administration, HR overhead, multi-vendor agreement management, etc.

When considering all of the operational expenditures associated with the “In-House” model, executives are starting to realize that the hidden treasure of moving to the cloud is not only in the transition from CAP-EX to OP-EX, but also the potential to lower OP-EX.  Therefore, reducing the inefficiency of managing multiple vendors and the internal staff required to maintain and optimize the CAP-EX investments in technology.

Leverage Cloud Computing to Impact Revenue Generation

It goes without mentioning that a move to cloud computing can help strengthen an organizations financial position, resulting in opportunity to invest in other areas such as new products / services, marketing, or expansion.  For the sake of this article, I would like to focus on cloud based communications solutions as an opportunity to impact revenue generation. 

These solutions would include unified communications with presence technology, enterprise messaging, and mobile computing solutions.  Enhancing the quality and speed of internal and external communications can be a strong competitive opportunity for all businesses.  The faster we can move through the business process while keeping quality in check; the faster revenue is being generated, which is something all of us can get excited about.   

An example of this would be presence technology.  By using cloud based software, organizations can have the ability to see the status of your teams and team members (online, offline, on the phone, in a meeting, out to lunch, etc.) at a glance and in real time.  This can enhance the speed in which your teams can get answers to questions, react to customers, communicate with vendors, and ultimately get more done in less time resulting in greater productivity.  This is one of many examples of how a cloud based technology can create a revenue-impacting opportunity in a business without the need to purchase expensive software and utilize internal resources to deploy the technology.

Conclusion

Nobody will argue that the cloud is going anywhere.  With market indications of triple digit percentage growth in the next 24 months, there is a great deal of opportunity for businesses to benefit from this shift in computing.  Since technology is always changing and progressing, organizations that remain nimble enough to adopt the changing technology concepts are in the best position to gain the competitive advantage in their market place.  Given these projections, it is my opinion that we are moving past the point of early adoption with cloud computing and if organizations are unwilling or unable to adapt to the opportunity in front of them, they will soon be left in the tail winds of their competition.