frost.comThe contents of these pages are copyright © Frost & Sullivan. All rights reserved.

THE HYBRID CLOUD LANDSCAPEPerspectives from the 2018 Frost & Sullivan Cloud User SurveyCLOUD COMPUTING (CC) 8-05DECEMBER 2018

2The Hybrid Cloud Landscape

CONTENTS

3 Executive Summary

4 About the Frost & Sullivan 2018 Cloud User Survey

5 Hybrid Cloud Supports Business Goals

6 Growth across All Infrastructure Types

7 Integrating Infrastructures into Hybrid and Multi-Cloud

8 EnterprisesUseHybridConfigurationsforSomeWorkloads

9 SomeWorkloadsReturntothePrivateDataCenter

10 WhatCustomersWantfromaHybridCloudPlatform

11 BusinessChallengesinIntegratingaHybrid Cloud

12 Hybrid Challenges: Migration

13 Hybrid Challenges: Security

14 TheLastWord

HybridcloudsarebecomingastandardconfigurationinenterpriseIT,withthemajorityofUSbusinessesin2018havingalreadydeployed,orplanningtodeploy,ahybridenvironment.Inbuildingtheirhybridclouds,enterprisesseektocreateaseamlesspoolofresourcesacrossthe business’s premises and the cloud. They also expect to centrally manage all resources from a single management platform.

TheFrost&SullivanCloudUserSurvey,whichhasbeenconductedannuallysince2010,tracksperceptionsandbusinessbehaviorsrelated to cloud and IT decisions. By comparing recent years’ results tothosereturnedin2018,wecanexaminetrendsinhybridclouddecisions and deployments.

Topfindingsfromthe2018surveyincludethefollowing:

• Adoptionofhybridcloudcontinuestoincrease,withmore businesses deploying hybrid clouds in 2018 than in previous years.

• 75%ofbusinessesaresatisfiedorverysatisfied with their hybrid cloud platform provider.

• Businesses are increasing investment in all infrastructure types,even traditional options such as physical servers.

• Businesses are also rethinking their earlier cloud decisions. 43% ofbusinesseshaverepatriatedatleastonecloudworkload;anadditional 35% are considering doing so.

3The Hybrid Cloud Landscape

EXECUTIVE SUMMARY

33%

35%

US BusinessesCurrently UsingHybrid Cloud

US BusinessesExpecting to ImplementHybrid Cloud by 2020

4The Hybrid Cloud Landscape

ThecurrentsurveywasconductedviawebinJune2018,garneringresponsesfrom401US-basedITdecision-makersresponsibleforpurchasesofITinfrastructure,software,orservicesfortheirfirms.

ABOUT THE FROST & SULLIVAN 2018 CLOUD USER SURVE Y

2018 Cloud Budget

Industry

Respondent Title

Company Size

1–99employees

100–499employees

500–999employees

1,000+employees

25%

25%25%

25%

IT Manager/Supervisor

CIO/CTO/C-Level

VP/Director

President/CEO/Owner

Developer/Other

36%

21%

21%

16%

6%11%

Financial services

HealthcareHigh tech

Manufacturing/distribution

Professionalservices

Retail/consumer

Education

Other

25%

25%

10%

9%

9%

6%

5%

11%

Less than $25,000

$25,000–$100,000

$101,000–$300,000

$301,000–$600,000

$601,000–$1 Million

Over $1 Million 11%

20%

26%

23%

12%

8%11%

5The Hybrid Cloud Landscape

Inthehypercompetitivedigitalera,businessesareembracinggoalssuchasagility,innovation,andmarketresponsiveness.Tosupportescalatingtechnologyneeds,ITorganizationsareadoptingflexiblehybridandmulti-cloudenvironments.

Hybrid clouds integrate any combination of private data centerresources,Infrastructure-as-a-Service(IaaS),Software-as-a-Service(SaaS),andPlatform-as-a-Service(PaaS) under a common management and orchestration platform.

Multi-cloud deployments combine cloud services from multiple providers.

HY BRID CLOUD SUPPORTS BUSINESS GOALS

FOR MORE INFORMATIONNeed to know more about hybrid cloud deployment? See Evolving the Enterprise Hybrid Cloud.

81%

67%

of businesses saythe cloud supports

of businesses say the cloud positions their company to

business agility and market responsiveness

take advantage of new technologiesBusinesses are using more

infrastructure options

2017 2018 2020

4.55.4

10.0

6The Hybrid Cloud Landscape

Evenastheyadoptmoderncloudservices,businessescontinuetoinvestinthepremisesdatacenter.Assuch,growthcontinuesacrosstraditionalandnewinfrastructureoptions,bothpremises-basedandcloud.

GROWTH ACROSS ALL INFR ASTRUCTURE T Y PES

66%

50%60%

79%70%

70%On-Premises Private Cloud

On-Premises Physical Servers

Hyperconverged Infrastructure

IaaS: Public Cloud

Bare Metal Cloud ServersBusinesses will increase infrastructure investmentby 2020

FOR MORE INFORMATIONLooking for ways to modernize your corporate data center? See Optimizing the On-Premises Data Center: Three Ways to Drive Transformation.

7The Hybrid Cloud Landscape

As the number and type of infrastructure optionsgrows,sodoesthemanagementburden. Each cloud service provider has aunique,oftenproprietary,managementplatform,whichmaynotintegratewithtools currently used to manage existing datacenterinfrastructure.Furthermore,the disparate infrastructures do not easilyintegrate,makingithardtomigrateapplications,executebackupsordisasterfail-overs,orscaletosupportgreaterapplication usage.

This is why businesses are increasingly adoptinghybridcloudplatforms,which allow them to group disparate infrastructure,andmanagethemcentrallyasonesinglepoolofresources;orinthecaseofmulti-cloud,allowingthemtoorchestrateworkloadsacrossdisparatecommercial clouds.

INTEGR ATING INFR ASTRUCTURES INTO HY BRID AND MULTI‑CLOUD

FOR MORE INFORMATIONAre you using the right mix of cloud service providers? See Beyond the Big Three: Cloud Service Providers that Should be Part of Your Multi-Cloud Strategy.

No Plans toImplement

28%

59%

Using orPlanning to Use

Hybrid Cloud Use

Adoption of Multi-CloudIT Environment

2012 2018

2018 2020

Adopted Expect to Adopt

29%

71% 68%

32%

8The Hybrid Cloud Landscape

Workloadsarenolongerstandaloneentities;developersintegratemicro-services,applicationprogramminginterfaces(APIs),andthird-partyapplicationsintotheirownworkloadstoenhanceor extend functionality. From security applications thatscandataasitisingestedintoanapplication,toanalyticsthatimproveanapplication’sresults,workloadsareintegratingdataandservicesfromnumeroussources.Hybridworkloadsarethosethat utilize two or more deployment options.

In2018,topworkloadsdeployedinahybridconfigurationinclude:

• Business productivity

• Collaboration applications

• Security

• Object Storage

• Artificialintelligence

• Disaster Recovery

ENTERPRISES USE HY BRID CONFIGUR ATIONS FOR SOME WORKLOADS

FOR MORE INFORMATIONWant to know more about where and how businesses are deploying their apps? See Survey Shows Shifts in Business App Placement: Managed Services, SaaS, and Co-Lo Steal Share from IaaS.

54%

47%

45%

38%

20%

5Common HybridWorkload Scenarios

Cloud-based app accesses premises database

Cloud-based app leverages multiple data sources

Legacy app integrates with cloud-basedfunctionality

Prem-based storage is replicated orarchived in a cloud

Edge-based workload does analysis; then transmits data to the cloud

9The Hybrid Cloud Landscape

Intheearlydaysofcloud,manybusinessesdeployedworkloadsintothepubliccloudwithoutsufficientduediligence.Intheinterveningyears,theyhavecometolearnthatthepubliccloudisnotidealforallworkloads.Higher-than-expectedcosts,applicationperformanceissues,orsecurityconcernssometimesmakeaworkloadunsuitableforthepubliccloud.Asaresult,somebusinessesarebeginningtobringworkloadsbacktothepremises.Thisiscalled“repatriation.”

SOME WORKLOADS RETURN TO THE PRIVATE DATA CENTER

FOR MORE INFORMATIONWant to know more about workload placement in the cloud? See Assessing Workloads in a Hybrid Cloud.

63%

63%

61%

58%

57%

47%

5Reasons forRepatriatingWorkloads

TopChallenges Migrating Workloads

Security Incidents in the Cloud

Challenges with Cloud Backupand Recovery

Poor or Inconsistent AppPerformance

Challenges Optimizing CloudWorkloads

Challenges Managing Coststo Run Cloud Workloads

46%of businesses say that choosing the right infrastructure tobest support each workload is a challenge

43%of businesses have repatriated at least one cloud workload

35%an additional

are considering doing so

10The Hybrid Cloud Landscape

Withbusinessexpectationsfortechnologyincreasing,ITneedsarobustplatformtohelpimplementacohesivehybridsolution.Creatingcross-platformvisibilityandreporting,enablingcomprehensivesecurityanddisasterrecovery,andeasingmigrationbetweenplatformsareallareasthatITlookstostreamlinethroughahybridorchestrationandmanagementplatform.

WHAT CUSTOMERS WANT FROM A HY BRID CLOUD PLATFORM

CriteriaImportanttoU.S.BusinessesWhenSelectingaHybridCloudProvider,2018

FOR MORE INFORMATIONTo learn more about the hybrid management platforms available on the market today, see Cloud Management Platform Buyers Guide, 2017: Enabling Hybrid Clouds with Robust Management Solutions.

75%73%

68%67%

66%66%66%

65%64%64%

63%56%

Support for Multiple Clouds

Cross-Platform Visibility: By Dept. or Project

Integrated Network

Application Performance Metrics

Automated Failover Capability

Easy Cross-Platform Migration

Open Source Platform

Compliance Assurance

Cross-Platform Visibility: Usage

Single “Pane of Glass” Management

Common Access Management

Cross-Platform Visibility: Costs

11The Hybrid Cloud Landscape

Businesses continue to experience challenges implementing their hybrid clouds. Different infrastructure types support differentoperatingsystems,middleware,APIs,andprotocols.Applicationswrittenforonedeploymentmodelmaynotworkifmovedtoanother.Evenwithastronghybridplatform,managementtoolstypicallyworkata“leastcommondenominator”level,deprivingITfromleveraginginfrastructuretothefullestextent.

BUSINESS CHALLENGES IN INTEGR ATING A HYBRID CLOUD

FOR MORE INFORMATIONAre you looking to centralize management of disparate cloud workloads? See Effectively Managing the Hybrid Cloud.

74%of businesses needtighter applicationintegration

49%of businesses have troublemanaging multipleclouds

48%of businesses struggle tointegrate cloud and datacenter resources

12The Hybrid Cloud Landscape

50%are concerned over migration ofapplicationsor data

72%said that migrationchallenges would restrain them from deploying cloud workloads

86%of businesses seek hybrid platforms that offer the ability to easily migrate workloads among different environments

47%are increasinglyconcerned aboutbackup andrecovery

Migrating applications and data among different infrastructures remains challenging for the enterprise. Businesses struggle to moveapremises-basedapplicationtothecloud,thankstonetworkbandwidthconstraints,theneedtoremapdomains,andtheriskofbusinessdisruption.However,inahybridenvironment,migrationacrossenvironmentsisnotaone-timeinitiative.Toensureapplicationavailabilityanddataintegrity,businessesmustconstantlybackupcritical,changingdata,oftenacrossdiverseenvironments.Whilenewertechnologies,likecontainers,maymakeiteasiertoportapplicationsacrossinfrastructures,migration challenges remain.

HY BRID CHALLENGES: MIGR ATION

FOR MORE INFORMATIONWant to learn more about data migration? See Solving the Cloud Migration Challenge: Enterprise Pain Point Offers Opportunity for Providers.

In 2010 just 5% shared this migration concern.

In 2010 only 32% were concerned about backup and recovery.

13The Hybrid Cloud Landscape

75%

fear a loss of control over their workloads

51% 48%

struggle with inflexible or inadequate processes and

governance of cloud workloads

have trouble ensuring that appropriate security profiles are maintained

Inhybridenvironments,securityremainsatopconcern,with80%ofbusinessescitingitasachallenge.Concernsovercomplianceassurancearealsoanissue,citedby54%ofbusinesses.Providershaveautomatedmanysecurityfunctionsthroughtheirmanagementplatforms,withagoalofapplyingsecuritypoliciesconsistentlyacrosseveryinfrastructurewithin the environment.

FOR MORE INFORMATIONTo learn more about cloud security, see Developments in Cloud Security: Taking on a Full Court Press.

HY BRID CHALLENGES: SECURIT Y

14The Hybrid Cloud Landscape

In2018,businessesrecognizethatadiverseITenvironment,comprisedofmanytypesofinfrastructures,isthebestwaytosupportbusinessflexibility,agility,andspeed-to-market.Whilepubliccloudoffersmanybenefits,businessesrealizeitcannotmeeteveryITneed.

HYBRID CLOUDS ENABLE BUSINESSES TO CENTRALIZE MANAGEMENT AND ORCHESTRATION OF WORKLOADS ACROSS A RANGE OF INFRASTRUCTURES. This allows them to choose the best infrastructure to support each particularworkloadbasedoncriteriasuchasperformance,cost,securityandcompliance;whilemanagingallinfrastructureswithinthehybrid environment using a single platform. This allows for cohesive securityandgovernance,aswellasvisibilityintousageandcostsacross the entire environment.

But,enterprisesstillstrugglewithhybridclouddeployments.

APPLICATION INTEGRATION, SECURITY, AND MIGRATION ARE PAIN POINTS THAT BUSINESSES LOOK TO SOLVE WITH THEIR HYBRID CLOUD PLATFORM. Providers that address these concerns within their hybrid platforms will be poised for ongoing success as hybrid cloud deployments grow through 2020.

THE LAST WORD

For more information about the 2018 Frost & Sullivan Cloud User survey,contactyour account executive or

inquiries@stratecast.com.

Karyn PriceSr.IndustryAnalyst,CloudComputing karyn.price@frost.com

15The Hybrid Cloud Landscape

ABOUT FROST & SULLIVANFrost&Sullivan,theGrowthPartnershipCompany,worksincollaborationwithclientstoleveragevisionaryinnovationthataddressestheglobalchallengesandrelatedgrowthopportunitiesthatwillmakeorbreaktoday’smarketparticipants.Formorethan50years,wehavebeendevelopinggrowthstrategiesfor theGlobal1000,emergingbusinesses, thepublic sector and the investment community. Is your organization prepared for the next profound wave of industry convergence, disruptive technologies, increasing competitive intensity, Mega Trends, breakthrough best practices,changing customer dynamics and emerging economies?

For information regarding permission, write:Frost & Sullivan 3211 Scott BlvdSantaClaraCA,95054

Visit our Stratecast web page.

Interested in learning more about the topics covered in this paper? Call 877-463-7678 or email us at inquiries@stratecast.com

Attend one of our Growth Innovation & Leadership (GIL) events to unearth hidden growth opportunities.

NEXT STE PSSILICON VALLEY3211 Scott Blvd SantaClara,CA95054 Tel 650.475.4500 Fax 650.475.1571

SAN ANTONIO7550WestInterstate10 Suite 400 SanAntonio,TX78229 Tel 210.348.1000 Fax 210.348.1003

LONDON566ChiswickHighRoad LondonW45YF Tel+44(0)2089968500 Fax+44(0)2089941389

ABOUT STRATECASTStratecast collaborates with our clients to reach smart business decisions in the rapidly evolving and hyper-competitive InformationandCommunicationsTechnologymarkets.Leveragingamixofaction-orientedsubscriptionresearchandcustomizedconsultingengagements,Stratecastdeliversknowledgeandperspectivethatisonlyattainablethroughyearsofreal-worldexperienceinan industrywherecustomersarecollaborators;today’spartnersaretomorrow’scompetitors;andagilityandinnovationareessentialelementsforsuccess.ContactyourStratecastAccountExecutiveto engage our experience to assist you in attaining your growth objectives.