North Bridge Growth Equity Venture Partners and research analyst firm Wikibon, which analyzes trends in cloud computing adoption, use, and challenges every year, has released their 2016 Future of Cloud Computing survey results this month, and it has thrown up several insightful trends that are shaping the industry.

The survey was endorsed and supported by several companies, including Microsoft, Red Hat, the Linux Foundation as well as entrepreneurs such as Acquia, AppFormix, Cazena, Dyn & WPEngine.

2016 Future of Cloud Computing survey - North Bridge

The sixth annual Future of Cloud Computing survey is possibly one of the broadest research efforts to understand underlying trends and developments in the cloud industry, with 53 cloud companies participating as collaborators, sending 1,351 responses. According to the research firm, the survey represents a 60/40 balance of user/vendor perspectives.

Some of the key points or insights from the survey:

  • 42% of companies derive more than half of their business through cloud-based applications, while 20% get none of their business from cloud-based applications and 10% of companies don’t use cloud apps at all.

2016 Future of Cloud Computing survey - North Bridge

    • Hybrid cloud model remains the predominant strategy at 47 percent, followed by purely public cloud use at 30 percent. 59% of companies are storing over half of their data in a private cloud while 28% of companies stored over half of their data in a public cloud.
    • 7 out of ten companies use SaaS

  • 61% of companies use just one PaaS/IaaS vendor but 56% of companies use multiple SaaS vendors

2016 Future of Cloud Computing survey - North Bridge

  • Security, vendor lock-in and privacy issues have emerged as the top hurdles (for shifting to cloud)

The biggest takeaway from the survey is that the world has not yet embraced public cloud completely, and cloud environments are going to remain predominantly hybrid in the coming years. There is a high degree of probability that it might remain that way for a really long time.

Interestingly, however, that’s not the perception we get from the industry, as most of the chatter revolves around public cloud. Rarely do we hear about hybrid cloud from the Amazons and Microsofts of the cloud computing industry. But IBM has always kept its eyes on the hybrid path instead of going all out to get companies to embrace cloud for their infrastructure needs in entirety.

The second biggest takeaway is that businesses around the world have already embraced the pay-as-you-go model of software delivery. Gone are the days where you license a software product using a one time payment or pay every year model. Almost seven out of ten companies are already using software-as-a-service applications, and it is only going to keep expanding from here.

When it comes to the matter of vendors, companies naturally prefer to handle one vendor if possible. So, if they are using Microsoft’s productivity suite, Office 365, they might prefer to use Microsoft Azure for their infrastructure needs. This does bring a bit of an edge to the SaaS-PaaS-IaaS players in the longer run, but companies will always use multiple vendors when it comes to SaaS because that’s the only way to access niche software that is tailored to their specific needs.

But possibly the biggest takeaway from this study is the fact that cloud computing is here to stay. Worries about regulatory compliance have been pushed to the bottom of the heap, the hybrid model has stepped in an as ideal answer to the questions that many CTOs and CIOs have posed in the past, public cloud is becoming the de facto platform for the Internet of Things and several other basic shifts have taken place to signify the “coming of age” of cloud computing.

2016 has been a good year of growth for the cloud industry overall, but the real benchmarks have been set by the industry leaders – specifically, the breaching of the $10 billion barrier for annual cloud infrastructure revenue run rates, and the creation of the next big milestone – $20 billion in cloud revenues by 2020.

Thanks for reading our work! We invite you to check out our Essentials of Cloud Computing page, which covers the basics of cloud computing, its components, various deployment models, historical, current and forecast data for the cloud computing industry, and even a glossary of cloud computing terms.