Multicloud is the future of the industry
The cloud storage market has been growing steadily in recent years, and according to Wasabi’s Global Cloud Index Report, this growth is expected to continue across all markets worldwide as enterprises continue to move their data loads from on-premises to on-premises storage. cloud. The rate of growth is such that forecasters today predict a compound annual growth rate of around 23% for the market and the market valuation to reach $376.67 billion in 2029, compared to $70.19 billion in 2021.
Despite this growth, the market is still dominated by hyperscalers. In fact, there is a level of dominance among the hyperscalers that is so high that alarm bells have started ringing worldwide. In Great Britain, for example, three hyperscalers together account for just over four-fifths of the entire cloud market.
The hyperscaler trade-off
A major reason for the dominance of hyperscalers in the cloud market is the vast amount of cloud services that hyperscalers have to offer. Businesses can easily turn to hyperscalers for all their cloud services as they are ultimately useful options for managing and storing business data. Hyperscalers are often able to cover the entire cloud needs of businesses, meaning IT professionals using these services don’t necessarily have to think much about how and where to store business data. Hyperscalers across the board have hundreds of products on offer each.
Unfortunately, all this convenience comes with a trade-off: convenience for quality and price. Even with a budget the size of a hyperscaler, product quality often suffers as resources are spread across so many products and the cost competitiveness of each individual service is sacrificed as more profitable services are used to cross-subsidize less profitable or successful services.
Because resources are always finite, focus is the key to quality and innovation. No matter how great you are, you can’t be the best at everything. There will always be a need for vendors like Amazon that offer everything under one roof, but there will also be a need for specialized vendors, with proven interoperability with standard hyperscaler APIs, offering the best products in a small area, with technical support that specializes is in that area. Just like in the hardware world, people will ultimately want to put together cloud solutions that involve many different vendors, each representing the best product in its category.
VP and GM EMEA at object storage service provider Wasabi.
Convenience, price and risk
The more services you purchase from a single supplier, the more tied in you become and the less flexibility you have when it comes to pricing and service. Having all your data in one place, including backups, is not something I would recommend. The more dependent you become on one supplier, the greater the risk. You may be relying on one of the many cloud apps offering hyperscalers, only to discover that the vendor has decided to discontinue support for that app, leaving you with peace of mind. Whereas if some of your data is lost, if your backups are in a second vendor’s cloud, worst case scenario you would still be able to access your backups. If you run your own apps in the cloud, moving them to other computing resources isn’t too difficult, but if you rely on your cloud vendor’s apps, switching vendors presents a huge, expensive technical challenge.
Another scenario is that you want to get all your data back, but discover that doing so will cost you a fortune in outbound data traffic fees. Or, as has been the case recently with some hyperscalers, the supplier could suddenly decide to dramatically increase prices. When you’re locked up, you have little choice but to pay up. Additionally, the person who chooses a company’s cloud vendor is often different from the teams using the service. Therefore, they cannot always accurately predict how the company will ultimately use the service, and consequently how much the company will have to pay in fees for the egress and API-based hyperscaler model.
As companies migrate to the cloud, they are often unpleasantly surprised by their bills, as the ‘pay for what you use’ pricing policy used by the hyperscalers can include costs that the customer may not even be aware of, for example API calls or outgoing data traffic. . Most people never measure things like how much data they pull from their storage or how often they update or touch their data, but those costs still exist. As a result, bills can come in well over budget, with companies spending capital that could otherwise have gone towards innovation or scaling. Last year, 52% of companies exceeded their cloud budgets and 48% of these expenses were spent solely on fees. By choosing an exclusive provider for all your business’ cloud needs, you risk falling short when it comes to cost predictability.
The future is a multi-cloud world
The solution here is clear; don’t leave all your eggs in one basket. Working with multiple partners in the cloud is an important way to reduce data risk and can ensure organizations turn to the right vendor for best-of-breed product offerings that fit their own unique needs.
For example, suppose media and entertainment organizations need to store large data files and access them quickly. a targeted provider for that specific service is the best option. If we imagine hyperscalers as generalist “one-stop-shop” cloud storage providers, we can look at the cloud market the way we look at superstores and more targeted stores. In a superstore, such as Asda or John Lewis, a wide variety of useful products are conveniently available all in one place. Among targeted stores such as luxury wine, clothing and shoe stores, we can find single, higher quality products that are popular with customers who need top quality items and may want to consult experts with in-depth knowledge about that specific product.
While hyperscalers can dominate the cloud market and easily provide broad-spectrum cloud solutions, a multi-cloud strategy is clearly the best path forward for businesses. As the cloud sector continues to grow at an incredibly fast pace, focused providers and hyperscalers are occupying different aspects of the market and can collaborate with shared customers. Innovation and competition may continue to flourish among cloud providers as companies flock to multi-cloud solutions and shop from both hyperscaler and more targeted providers to best meet individual business needs.
We’ve highlighted the best online collaboration tool.