Journey to the Cloud
Cloud computing, once seen as a disruptive technology, is now becoming an essential catalyst for innovation. By Tanyatorn Tongwaranan in Singapore
The use of cloud computing has become standard practice for businesses in various industries as they seek to maximise resources and infrastructure, optimise workloads and enhance security.
Revenue in the global cloud services market is forecast to reach US$555 billion by next year, according to Allied Market Research. Enterprises are predicted to invest over $3.5 million on average within the next year, accounting for 30% of their total IT budget in 2020, the market intelligence firm IDG has said.
The cloud ecosystem -- Infrastructure as a Service (IaaS), Platform as a Service (PaaS), Software as a Service (SaaS) and Recovery as a Service (RaaS) -- has grown in scope and popularity as it enables companies of all sizes to manage applications and services through global networks with high-end servers.
Businesses across Asia Pacific can ride the digital wave and capture a myriad of new business opportunities, increase profitability and enhance customer service by using cloud computing services to establish a strong foundation for a modern and secure digital infrastructure, according to experts.
The region's digital economy is growing exponentially and is projected to be worth $5.1 trillion by 2025, up from $200 billion in 2018, as more companies change their business models to scale up their digital transformation efforts.
However, one major obstacle they face is the lack of organisational agility and the slow pace of change toward modern digital infrastructure. This could be a result of strict government regulations or security concerns.
"Companies across the region are in the process of executing the digital transformation strategy," said Sanjay Deshmukh, vice-president and managing director for Southeast Asia and Korea of VMware, an enterprise software specialist.
"However, while they are doing that, they are also facing business challenges such as shifting customer expectations, accelerated disruption and increasing complexity. These challenges are in addition to budget constraints, security concerns and the lack of organisational agility."
Increasing consumer expectations are a major driver of growing digital adoption across industries, said Andy Rowsell-Jones, vice-president and distinguished analyst at the global technology research and advisory firm Gartner.
"Now we have a community that is being trained to expect their services to be delivered and consumed digitally," he said. "If you are competing in the market, you need to be very mindful of this shifting consumer sentiment."
Duncan Hewett, senior vice-president and general manager for Asia Pacific and Japan for VMware, added that in his view, one of the most exciting things in this region is the size of the population and the rate that technology is being adopted.
"Technology permeates everything in every sector. We are seeing the digital transformation happening across sectors to provide new services in a more consumer-friendly way," he said.
"Customer-centricity is a crucial element that organisations today have to adopt to be able to differentiate themselves. It's more than just technology."
SUPER COMPUTING POWER
When VMware surveyed 200 chief information officers (CIO) across various industries, cloud computing emerged as the number one priority for their digital transformation journey.
The public cloud offers that fastest and easiest route to getting started on that journey. Businesses can outsource applications or infrastructure to a third-party host such as Amazon Web Service (AWS), Microsoft's Azure or Google Cloud Platform.
In other cases where the applications or data are more sensitive, organisations can opt for an in-house private cloud model, using dedicated IT infrastructure only for their organisations and maintained via their internal resources.
"The biggest thing happening today is the increasing willingness of IT departments to step up and embrace this new technology," said Mr Hewett. "As customers start to accelerate their journey with cloud solutions, the biggest change we've seen is that users can gain access to elastic infrastructure, enabling them to innovate much more rapidly."
Even for traditional industries such as banking, modernising digital infrastructure to ensure the organisation is relevant to their customers is one of their priorities.
Earlier this year, VMware introduced VMware Cloud on AWS, an integrated offering jointly developed with AWS, the world's largest public cloud operator. The service delivers a highly scalable, secure and innovative service that allows organisations to seamlessly migrate and extend their on-premises data to the AWS Cloud.
United Overseas Bank Limited (UOB) is the first organisation in Southeast Asia to deploy VMware Cloud on AWS. It is using a seamless, multi-cloud architecture to support innovation and future technologies and to enhance customers' banking experience.
"VMware Cloud on AWS enables us to build our innovation platform on the cloud while maintaining our robust security standards," said Adhunik Chug, head of group shared infrastructure services, group technology and operations of UOB. "We are pleased to be the first company in Southeast Asia to use this integrated solution to power our innovation drive."
Lawrence Goh, managing director of UOB Group, added that from the business standpoint as a regional bank, two things come to mind when thinking about deploying new technologies: customer-centricity and regional connectivity.
"We want to make sure we could use our regional connections to allow customers to achieve the full potential of their business with a seamless flow," he said.
"To create this innovation, we need to have a very flexible infrastructure. That's why we embarked on a hybrid cloud strategy. We wanted to use the cloud as a way for elastic computing and resilience."
In the hybrid cloud environment, both the private and public cloud are used. Data and processes tend to intermingle, intersect and can be swapped as the computer resources perform the same function for both private cloud and public cloud, such as load balancing.
In a multi-cloud environment, on the other hand, multiple public cloud services from different providers will be used to accommodate various tasks to achieve the best outcome. A multi-cloud environment starts with multiple public clouds, but also operates in combination with on-premises physical, virtual and private cloud infrastructure.
Cloud computing, once seen as a disruptive technology, is now becoming a necessary catalyst for innovation as the technology becomes more mature.
According to Gartner, cloud computing is moving away from experimentation toward enterprise-wide adoption. By 2021, more than half of global enterprises already using the cloud today will have an all-in cloud strategy.
Dell EMC and the IT market research firm IDC predict that the cloud will contain more than 40 zettabytes of information by 2020 as each individual on earth is forecast to have 5,200 GB of data. (A single zettabyte contains one sextillion bytes, which equals 1 with 21 zeroes).
"Cloud computing is increasingly becoming a vehicle for next-generation digital business, as well as for agile, scalable and elastic solutions," said David Mitchell Smith, vice-president and Gartner Fellow at Gartner Research.
"CIOs and other IT leaders need to constantly adapt their strategies to leverage cloud capabilities."
One of the many reasons propelling the adoption of cloud computing is the seamless transition process and flexibility in the level of services needed by companies of different sizes from startups to multinational corporations.
In addition, it is expected that there will be many more applications being built in the next five years than in the last 40 years, resulting in the need for companies to keep up with the new digital business environment.
"This application deployment will drive the infrastructure decisions for companies," said Mr Deshmukh. "They are now looking at building digital infrastructure strategy, which will not only support the applications of the business today, but also the applications that they will build in the future to optimise business process, cost and security."
Companies, therefore, are now looking for consistent infrastructure and consistent operations, he added. In his view, when you look at the digital infrastructure required to run these applications, the future is clearly about hybrid and multi-cloud.
"Cloud technology is being used by customers across the region to get the benefit of efficiency, elasticity and agility," he said.
It enables businesses to modernise their IT infrastructure so that it becomes highly efficient and highly secure. It also provides agility through automation, while improving the efficiency of the business processes.
More importantly, he added, cloud technology enables elasticity, meaning that if a company needs more infrastructure at certain times to handle a greater workload, it can easily increase that required capacity.