Virtualization and Cloud executives share their predictions for 2016.  Read them in this 8th Annual VMblog.com series exclusive.

Contributed by Shannon Snowden, Senior Technical Architect, Zerto

2016 Predictions: Cloudy with a Chance of Snowballs

It's an interesting time of change in the IT industry. For the last few years, using the cloud for some portion of the core infrastructure has been a topic of discussion in IT thought leadership circles, but I think 2015 is the year where these discussions actually transitioned to reality.   

Cloud providers are focused on offering datacenter replacement level of services and they are maturing into legitimate infrastructure options. They are finding more than willing enterprise customers who want to get rid of their own datacenters and use a more efficient and cost-effective solution.

The customers of which I speak aren't nameless, faceless trends I found from reading analyst research. I've actually seen a steadily increasing number of our customers that have made the decision to either curtail or completely stop buying datacenter hardware, and shift to a managed or public cloud for their infrastructure deployments.

The snowball is rolling and gathering speed, and I expect to see this trend to continue to grow in 2016.

Maturing Cloud Services

Managed and public cloud providers are aggressively competing with each other, so the services being offered, the capabilities and costs must meet, or exceed, the performance and quality of service that customers have in their own datacenters.

One of the biggest concerns that enterprises traditionally had about using cloud services is security. Knowing they must overcome this barrier to adoption, cloud service providers have made security an area of focus. Since they want to be able to host all segments of customers, they must meet or exceed security requirements, across many industries. This cascades into an overall benefit of a very secure environment.

These security capabilities of cloud service providers are reflected in a recent study conducted by the analyst firm ESG, which shows customers using cloud services feel their data is more secure with the cloud provider than what they were doing themselves.

We are seeing customers in verticals you wouldn't expect. Companies from healthcare and financial segments are increasingly accepting cloud services as their solution. That's a major shift in thinking from just a couple years ago.

Datacenter Hardware Vendors Feel the Chill

It turns out that the biggest threat to datacenter hardware vendors isn't other hardware vendors; it's cloud services providers that buy cheap, commodity hardware at scale and offer acceptable levels of datacenter services.

As cloud services get better, and customers gain confidence, it is putting an increasing amount of pressure on datacenter hardware vendors. The big expensive hardware storage arrays, and servers, are their cash cows and as the cloud momentum picks up velocity, customers aren't so quick to buy them anymore.

Hardware vendors who haven't balanced their portfolio of product offerings will be forced to find alternatives like consolidation. So look for more significant changes with hardware vendors, like Dell acquiring EMC, to continue. These newly combined companies will build competing clouds based on their hardware and offer fully managed services to try to survive. As a result, customers will have even more cloud-based options in the future.

However, all of the hardware vendor instability has another effect. Customers will lose confidence that the hardware, or even the hardware brand, will exist before the warranty runs out.

It actually increases the momentum to the cloud snowball with two very different types of IT decision makers. 

Shifting to the cloud isn't just for the decision makers that embrace the new or bleeding-edge technologies. As cloud services gain in the market as an acceptable option, the decision makers that traditionally have picked a hardware vendor and settled in for the long term, because of stability, are prime potential cloud customers. 

Because with cloud services, they aren't buying hardware, they are buying a stable service levels.

Let it Snow

2016 will be an interesting year of transition in how IT organizations provide infrastructures to the business.

The good news is IT decision makers have more options than ever before to meet the business needs.  Navigating through the changes will be a challenge, but worth the effort.  

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About the Author

Shannon Snowden, Senior Technical Architect, Zerto

As Senior Technical Architect, Shannon helps develop and articulate the technical product messaging and use cases so clients, prospects, industry analysts, and media better understand the value proposition of Zerto. He also establishes and develops strategic technical alliances with synergistic technology vendors to create productive co-branded solutions leveraging the power of Zerto.

Shannon has more than 15 years of experience in the technology industry having started his career at New Age Technologies as a Senior Solutions Advisor. In addition to his position at New Age Technologies, Shannon has also worked as a consultant for PharMerica and Kindered Healthcare as well as in the Information Security Department at Yum Brands. As a Senior Technical Architect at Zerto, Shannon works towards developing and articulating the technical product message and developing strategic business partnerships with key technology vendors and service providers. He was named a vExpert in 2009 and again in 2012 by VMware and has been a delegate for Tech Field Day as well as a judge for Best of VMworld. Shannon received a BA in Business Administration at Sullivan University.