Reflecting on last year, there were some landmark events in the cloud industry that paved the way for 2024 – from the advances in AI, tech giants grappling with unforeseen financial challenges and cuts, to criticism toward the UK government’s G-Cloud initiative efforts, to Ofcom’s prompting to the CMA to investigate anti-competitive practices in the nation’s cloud market.
As we head further into the new year, these cloud stories serve as a backdrop for anticipating the trajectory of the cloud industry. In 2024, companies are expected to leverage lessons learned from last year’s challenges and become more inclined to explore the various cloud models available to determine which one might best fit their specific business needs.
Hidden costs are no longer hidden
With financial planning underway, IT decision-makers are re-evaluating their cloud spending to consider where unnecessary costs lie. It’s no secret that the cost of the cloud is on the rise, with 82% of organisations listing cloud spending as their top challenge. It’s clear to say that the initial intention of the public cloud to be the most cost-effective solution no longer holds as true. Hidden costs of public cloud services include pilling charges from leaving servers running (which also means paying for unused resources) and hidden data access and exit fees.
Naturally, IT decision-makers are increasingly asking for transparent, fixed monthly rates to plan their IT budgets around because this is what other cloud models, such as the private cloud, can offer. For this reason, 2024 will likely witness an increase in adopting alternative cloud models, such as private cloud, or a move towards hybrid infrastructures. Decision-makers are now understanding that despite higher implementation costs, these options can evade hidden charges and offer better long-term investments while better serving their company’s individual needs.
Increased control over data in the cloud
In addition to hidden costs, businesses are facing a lack of control over their cloud infrastructure, with 40% of organisations in 2023 reporting a loss of control over IT environments. This stems from data security concerns, challenges in handling sensitive data, risk management complexities, issues with data portability, transparency gaps, and the risk of vendor lock-in.
Again, the cloud was intended to simplify complex data management. However, the reality is that cloud resources need near-constant upkeep or monitoring to ensure the cloud is delivering real value.
Heading further into 2024, businesses will likely be looking for cloud setups that offer them greater control over their infrastructure. This again helps the rise of adoption of alternative cloud models — private cloud, multi-cloud, and hybrid cloud.
What’s more, businesses will seek cloud solutions that can be tailored to the amount of control their industry demands; for example, financial institutions dealing with highly confidential client information might opt for a hybrid cloud model to retain sensitive data on-premises or in dedicated environments while leveraging cloud benefits for other workloads.
Cloud de-concentration will be a top priority
A term of cloud technology concern that has taken off recently (but is older than you might think) is cloud concentration. Cloud concentration refers to a situation where an organisation depends on a single cloud provider, typically one of the hyperscalers. This dependency can pose significant risks to the infrastructure, increasing its security vulnerability and harmful downtime effects.
Following the industry’s conversations, it seems like cloud concentration is set to dominate the concerns of IT decision-makers in 2024, marking a shift away from the default ‘all-in’ on the public cloud.
To avoid potential outages, insecure APIs, and limited visibility, organisations are reconsidering their cloud strategies to a hybrid or multi-cloud approach, with a reported 80% of companies already using multiple cloud providers to spread risk.
This shift reflects a broader trend in the industry, where companies are recognising the importance of having well-considered continuity plans and exploring alternative cloud strategies to ensure resilience and security.
A close in the skills gap
Despite a surge in cloud-related job postings, 80% of organisations do not have a dedicated cloud security team or lead due to a scarcity of skilled IT professionals. This skills gap is resulting in a multitude of issues like misconfigurations, security vulnerabilities, and operational inefficiencies.
A recent survey from SoftwareOne reveals that the skills gap has pushed developer teams to their limits, causing project delays, staff burnout and a decline in overall productivity, forcing some organisations to restrict their cloud usage. Contributing to this problem are tech giants who often take the top talent and leave little for the smaller players.
Consequently, enterprises need to adopt new solutions in 2024 to address this skills shortage through either upskilling existing internal teams or seeking assistance from managed service providers to bridge workforce skills gaps.
Big changes around the corner
It’s clear that the cloud industry is set to embark on a shift towards more secure, transparent and cost-effective cloud solutions.
As 2023 has shown us, this change has been prompted by the demand for control, fair costs, avoidance of cloud concentration, and a concerted effort to bridge the ever-widening skills gap through innovative solutions. In other words, 2024 is promising to kick-start a dynamic and resilient era of cloud computing.
Co-Founder and Director of Hyve Managed Hosting