As enterprise data demands increase, cloud providers and their customers are forced to consider the implications of rising storage costs, security risks, and environmental footprint. These impacts are of particular importance for UK organizations as it is the largest cloud market in Europe.
TechRepublic spoke to UK cloud experts to identify the top five industry trends arising from the country's increasing reliance on critical IT infrastructure. These cloud trends are:
- Premiumization of cloud packages.
- Movement towards hybrid multicloud models.
- Influx of sustainable cloud solutions.
- Continuous pursuit of data sovereignty.
- Focus on cloud security.
1. Premiumization of cloud packages
Adrian Bradley, head of cloud transformation at KPMG UK, explained that the rising costs of more premium services from cloud providers are forcing businesses to choose their packages more carefully. According to research from Dark Matter, 90% of UK businesses have noticed an increase in cloud costs.
Reduced demand for top-of-the-line offerings is also pushing cloud providers to improve their ability to shift from public cloud and diversify the packages they offer. Bradley referred to this concept as premiumization.
He told TechRepublic in an email: “The rise in public cloud prices is primarily due to high energy prices, a shortage of computer chips, and increased demand caused by the growing use of AI.” generative. While expensive, the premium services provided by the public cloud are extremely valuable as organizations use them to drive maximum efficiency in their businesses.
“But when companies can't get that value (from premium services), some workloads can be located elsewhere more economically. Non-public cloud offerings are proving to be an attractive alternative, providing a cost-effective option for less premium services.
“As a result, UK businesses will need to review their business and cloud strategies to become more adaptable and value-led. This means that its use of the public cloud will focus on higher-value, premium services such as generative AI, which will enable more complex and intelligent solutions for data analysis, automation and decision-making. “Simple compute and storage will gravitate toward the lowest-cost platform.”
2. Movement towards hybrid multicloud models
According to a December 2023 enterprise cloud index from cloud platform provider Nutanix and reported in Cloud Next, 46% of UK businesses will use multiple public clouds in the next one to three years, while globally this figure is expected to be only 26%. . Hybrid multi-cloud models will also be used by 26% of UK businesses, up from 19% currently. The main factors cited by UK respondents behind this pronounced shift towards hybrid multi-cloud models are performance, cost, data sovereignty, malware protection and flexibility.
Jake Madders, co-founder of UK-based cloud hosting provider Hyve, says partnering with different cloud providers becomes more profitable as the price of services increases. He told TechRepublic: “Enterprises can optimize their spend based on workload requirements and pricing differences between providers, thereby reducing overall cloud spend.”
The problems associated with supplier lock-in are also becoming more evident. In April 2024, documents seen by The Register revealed that the UK government was concerned that its current cloud model, dominated by AWS and Azure, put its “bargaining power over cloud providers” at risk. Distributing workloads across multiple providers can reduce such risks, as well as the potential impacts of outages and data breaches.
Madders added: “This type of cloud infrastructure also enables greater resilience and performance by providing redundancy and enabling workload distribution across geographically dispersed data centers. This ensures high availability and minimizes latency to improve the user experience.”
3. Influx of sustainable cloud solutions
“Companies today not only want power; They want sustainable energy and accessibility,” Lars Nyman, chief marketing officer at UK-based cloud computing platform CUDO Compute, told TechRepublic in an email. “They also want to contribute to a greener future without losing high-performance computing.”
SEE: Top UK sustainability trends 2024: four key challenges and insights
While the term “cloud” may conjure up images of fluffy white clouds in blue skies, the reality is that the technology is not inherently environmentally friendly. Many data centers still rely on fossil fuels, while the applications and databases hosted there are not optimized to use resources efficiently. Intel research predicts that infrastructure and software inefficiencies account for more than 50% of data center greenhouse gas emissions.
Madders added: “Environmental concerns around hosting and data centers remain one of the key technology drivers in the cloud industry. “As a result, we are likely to see new cutting-edge technology in cooling systems and computing power.”
These new technologies could include energy-efficient processors and liquid cooling systems that use dynamic voltage and frequency scaling. There could also be moves toward reusing excess heat from data centers; The UK government recently announced it would channel it to provide low-cost heating to more than 10,000 homes.
Nyman added that these new technologies could work to democratize sustainability in the area. “Previously, only large companies could afford to pursue meaningful sustainability goals,” he told TechRepublic. “Startups (need to) focus on keeping the lights on.
“Dirty, power-hungry data centers may become a thing of the past.”
4. Continued pursuit of data sovereignty
Jason Van der Schyff, COO of London-based private cloud provider SoftIron, told TechRepublic in an email: “We see little indication that 2024 will be less turbulent in terms of geopolitics than we have seen in previous years. “. Earlier this month, the payroll system used by the Ministry of Defense was hacked and ministers reportedly suspect China's involvement.
“With respect to its impact on IT, we hope this will accelerate nation-states' plans to boost their own sovereign resilience,” Van der Schyff added. He predicted this will manifest as governments invest in IT infrastructure and skills to build “true sovereign clouds.” In January 2024, The Times reported that the UK government would support the growth of the country's data center infrastructure. Then, in March, the government announced it would invest more than £1.1 billion to train in artificial intelligence, quantum technology and other technologies of the future.
SEE: Top IT skills trends in the UK by 2024
Prakash Pattni, general manager of Digital Transformation for Financial Services at IBM Cloud, says organizations will take significant steps to achieve their own data sovereignty to help them comply with the new regulations.
He told TechRepublic in an email: “As regulations evolve, companies are finding that they must be prepared to navigate specific geographic requirements to remain competitive and the cloud can play a critical role in helping companies achieve the data sovereignty.
“This is especially critical now as AI grows – and with it – comes an influx of data. While AI will drive tremendous business innovations, it also requires strategic considerations about where data resides, its privacy, and more.
“Organisations across the UK, and especially those in highly regulated industries, are adopting sovereign cloud capabilities to help them manage their regulatory obligations and will continue to do so in the years ahead.”
5. Focus on cloud security
Neil Templeton, senior vice president at network platform-as-a-service provider Console Connect, told TechRepublic in an email: “Cyberattacks are inevitable and their frequency will only increase, especially as hackers employ AI to fuel their efforts.” In January 2024, the UK's National Cyber Security Center ruled that generative AI can increase the risk of cyber threats by providing a “capability enhancement.”
SEE: Report Reveals Impact of AI on Cybersecurity Landscape
Templeton added: “Network infrastructure and security should be a top priority this year, and part of the evaluation should be determining whether businesses should avoid the risks of the public Internet by migrating to a private network environment.” .
IBM Cloud's Pattni added that many UK businesses are prioritizing their cybersecurity this year when it comes to their cloud services. He said: “Companies in highly regulated industries that handle sensitive data, such as healthcare, telecommunications, financial services and the public sector, are increasingly adopting risk management solutions that can help them gain visibility across their assets. IT, including third parties and fourth parties. “
“It is critical that enterprises have the right foundation in place to truly enable reliable performance and security for enterprise AI and other data-intensive workloads.”
