By 2023, the global cloud computing market is expected to be valued at almost US$600 billion. This comes as no shock as the market saw a spike in adoption after the pandemic. When implemented correctly, cloud computing may provide benefits to businesses that on-premises infrastructure can only dream of matching, including greater adaptability, scalability, economies of scale, and cost efficiency.
However, this doesn’t mean that businesses can pick a cloud service, turn it on, migrate, and immediately begin reaping the benefits. Businesses may get the most out of their cloud investments and see the results they seek from using the cloud if they tailor the services they purchase from the cloud to their current and future needs.
To stay ahead of the curve, they need also be aware of how the cloud market is evolving. They may then be confident that the cloud services they purchase will continue to provide them with a competitive edge well into the future.
Trends in clouds are rarely caused by just one thing. Take, for example, the demand for managed hyperscale edge computing services. Enterprises in all fields are looking for more ways to share their work, and because of this, they need distributed computing and storage that can give instant response times at the edge.
One of the benefits is that less data needs to be processed in centralized clouds. This cuts down on network latency and other costs of doing business. It also makes data safer by limiting how much it can be seen across networks.
More and more companies are hiring external parties to manage their applications, a trend that will keep going throughout 2023 and beyond.
The need for SaaS-based management comes from the fact that businesses are moving their workloads to SaaS applications and that new problems have arisen because of this delivery model. The prices for SaaS solutions are clear. When cost leakage from poorly managed SaaS solutions is found, it can be a surprise.
As 2022 comes to a close, digital transformation projects are still moving quickly, and if 2023 cloud computing trends are any indication, they won’t slow down any time soon.
Gartner, Inc. forecasts that spending on public cloud services around the world will grow by 20.7% to $591.8 billion in 2023, up from $490.3 billion in 2022. Moving to the cloud is no longer a choice, because its benefits and new features are so important for moving forward, especially in an economy with so much uncertainty.
These are some of the trends we can expect to see in 2023 for cloud managed services:
It’s very likely that more companies will use managed IT services as expert consultants in 2023, in addition to hiring managed IT services for specialized projects.
Many clients still wonder about the best way to run their cloud environments and most don’t know the answer, so it’s up to managed service providers to act as consultants.
Clients who use managed IT services as consultants usually don’t have a dedicated security team or don’t have a lot of staff. They hire managed services as a second set of eyes on their setup or to design their setup, even if the company decides to do the implementation themselves.
Artificial intelligence is being used by businesses more and more as companies try to improve their efficiency and come up with new ideas. And the cloud helps them make the most of their investments in AI.
A McKinsey & Company 2021 survey on AI found that 64% of “high performers,” or organizations that see the biggest impact on their bottom line from using AI, run their AI workloads on the public or hybrid cloud, while only 44% of other organizations do so.
The top performers also use public clouds to get access to more AI features, such as speech in natural language and face recognition. The study showed that almost two-thirds of companies planned to put more money into AI by 2023. Unlike private data centers, public cloud infrastructure can store and process a lot of data, which is what AI and machine learning applications need.
The Rise of XaaS
In 2023, investments in the cloud will also be driven by the growing maturity of “everything-as-a-service,” or XaaS. XaaS is a term for the wide range of goods and services that customers can get over the internet. It is also sometimes called “anything as a service.”
According to research, the global XaaS market reached $ 198.6 billion (USD) in 2021. The market is expected to reach $624.1 billion by 2027. Storage-as-a-service, security-as-a-service, and network-as-a-service are all part of the XaaS realm.
For end users, XaaS benefits include flexibility, scalability, speed, and cost savings through flexible payment models. They only pay for what they use instead of licensing fees and equipment that needs to be on-site.
The XaaS model is becoming more popular in the professional services industry, where companies are combining digital services, data, or assets with services provided by people. The model makes it possible for professional service providers to offer more services and for organizations to pay for results instead of time spent.
It’s not easy for a professional services firm to switch to the XaaS business model, but in 2023, we’ll see more newcomers as well as firms that have been around for a long time develop and improve their services.
59% of businesses find it hard to hire skilled IT workers, according to the 2023 State of IT Report. Companies have been looking to Managed IT services for help with staffing issues over the years. Staffing shortages were caused by resignations and on-site needs, and clients were asking for more staffing help and placement.
We also got a lot of requests about preparing for employees to come back to work, including planning for expected resignations. Because of this, many people asked about Remote Desktop Support and Business Process Outsourcing.
In 2022, a lot of customers asked for full-time placement in remote offices, in addition to adding to staff and finding temporary solutions. They wanted their Managed Service Provider to handle staffing so they wouldn’t have to use their own HR departments.
Booming Native Cloud Strategies
Microservices, containers, declarative APIs, and service meshes are all examples of modern ways to build software that are used in a cloud-native strategy.
According to Forrester’s 2022 Infrastructure Cloud Survey, 40% of companies will use a cloud-native-first strategy in 2023 as a way to be more flexible and save money at the same time.
Forrester thinks that more businesses will use cloud-native strategies as more of them choose to run workloads in containers instead of legacy virtual machines. This is because containers run more efficiently when using technologies like AI/ML, the Internet of Things, and 5G. As the use of containers grows, organizations will also have to update their application development processes.
Organizations no longer question whether or not moving to the cloud is worth it. Organizations can’t afford not to move to the cloud, whether it’s to take advantage of new technologies like AI and ML, gain a competitive edge, or just have a safe place to go when the economy is shaky.
There will be a lot of change in the next year as cloud managed service providers update their offerings and businesses make strategic moves to stay competitive, but one thing is clear: once you’re in the cloud, you won’t want to come back to the old way of doing things.