The Changing Faces of the Cloud

Abstract

Cloud computing has taken the technology industry by storm. Bain estimates that revenues for public and private cloud hardware, software and services amount to $180 billion, or 16% of the $1.1 trillion enterprise IT industry. From 2012 to 2015, cloud demand ac-counted for 70% of related IT market growth, and we expect it to represent 60% of growth through 2020 (see Figure 1). Technology providers that fail to compete and win in tomorrow's cloud computing market risk missing out on this important source of future growth. In 2011, when we wrote " The Five Faces of the Cloud, " our first Bain Brief on this topic, few would have pre-dicted how quickly this market would evolve. Most cloud demand was from start-ups and small and mid-size businesses. Security was a major concern, inhibit-ing large enterprises in particular from adopting cloud computing in a meaningful way. Nearly all of the cloud profit pool was earned by technology providers that sell the components to build public and private clouds, rather than by public cloud service providers that sell to end customers. In 2017, the picture has changed dramatically. Of the Fortune Global 50 companies, 48 have publicly an-nounced cloud adoption plans, many of which use the cloud for a broad swath of their IT environments. Secu-rity remains the top concern, but those doubts have moderated, as have concerns over uncertain cost sav-ings and loss of control. New concerns have emerged around compliance, vendor lock-in and data portability