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Cloud services expected to reach $4.55 billion by 2018

The Australian cloud computing market is expected to explode over the next few years, according to findings from Frost & Sullivan’s latest report, State of Cloud Computing in Australia Report 2014.

Software-as-a-service (SaaS), infrastructure-as-a-service (IaaS) and platform-as-a-service (PaaS) make up the Australian cloud computing market, which generated $1.23 billion in 2013. The report predicts a rise to $4.55 billion by 2018.

‘Cost savings’ is highlighted as a major factor pushing organisations to embrace cloud services; with the average IT cost savings coming in at 12 per cent.

Phil Harpur, Frost & Sullivan’s Senior Research Manager, Australia & New Zealand, says companies using cloud computing services are experiencing better business performance and points to Education, Mining and Government and Financial services as the sectors leading the adoption of the new computing system.

“Two thirds of companies that have adopted cloud services believe it has significantly improved their overall business performance. A significant proportion of organisations feel it has enhanced their ability to innovate and explore new business models,” Harpur says.

“The Education, Mining and in particular, Government and Financial Services, have been strong adopters of cloud over the last six to 12 months. The Retail and Manufacturing sectors are seeing strong adoption of cloud based business management applications.”

Frost & Sullivan’s Australian Cloud Services Survey, which involved some 603 senior management level executives who have currently deployed cloud-based solutions, found that security concerns have increased in organisations embracing cloud services.

“The dynamic nature of the cloud environment makes it more vulnerable to security threats and IT security requirements increase in complexity,” Harpur explains.

“38 per cent of organisations are more concerned about IT security since adopting cloud computing, and data security threats remain the key challenge, especially for public cloud deployments. Few cloud providers currently provide comprehensive security features built into their services, so companies must implement appropriate security policies to address these issues.”

IT departments are expected to begin evolving as more organisations begin using cloud services.

“Half of all organisations feel that the decision making process is shifting from that of the CIO and IT department to the individual business unit for implementation or updates of cloud applications such as HR, payroll, collaboration and conferencing,” a Frost & Sullivan spokesperson said.

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Guillermo Troncoso

Guillermo Troncoso

Guillermo is the Editor of Dynamic Business and Manager of film &amp; television entertainment site ScreenRealm.com. Follow him on <a href="https://twitter.com/gtponders">Twitter</a>.

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