Growth of Hybrid Cloud

Featured article by Sarah Lahav, CEO of SysAid Technologies

According to industry research, the hybrid cloud market is estimated to grow from $25.28 billion in 2014 to $84.67 billion in 2019, at a compound annual growth rate (CAGR) of 27.3%. The research also states that around 50% of enterprises will “embrace hybrid cloud”.

What the research doesn’t explain, however, is that the hybrid-cloud picture is far from clear due in part to the lack of agreement as to what hybrid cloud actually is. And of course it’s hard to measure what isn’t well understood. In my opinion, the headwinds and changing appetites that hybrid cloud faces are likely to render this forecast optimistic.

Hybrid Cloud Is like Quantum Physics

American theoretical physicist Richard Feynman is quoted as famously saying, ‘If you think you understand quantum physics, you don’t understand quantum physics.’ His Manhattan Project colleague, Neils Bohr, said something similar: “Anyone who is not shocked by quantum theory has not understood it.” And the same can be said for hybrid cloud.

The accepted, but very abstract, definition of hybrid cloud is from NIST in 2011:

“The cloud infrastructure is a composition of two or more distinct cloud infrastructures (private, community, or public) that remain unique entities, but are bound together by standardized or proprietary technology that enables data and application portability (e.g., cloud bursting for load balancing between clouds).”

In reality, a hybrid cloud could be a mixture of deployment models and technologies along a spectrum – from private to public. And no two hybrid clouds will be the same from one organization to another. Hybrid cloud is a complex, integrated stack of technology and processes.

To find a concrete example of what a hybrid cloud is, you can visit the websites of the hybrid cloud vendors to look at their hybrid cloud reference architectures and to see if there is any commonality between architectures. However, the only commonality to be found is that each vendor has created a hybrid cloud solution to exercise the maximum amount of their product portfolio rather than it being designed against specific user needs. This then has to be custom-made for each customer.

Started by the Vendors, Finished by the Providers

Where did hybrid cloud appear from? Amazon Web Services (AWS) started the public cloud in 2006. The technology vendors got scared because AWS wasn’t buying hardware from them, and when large customers started to use public cloud, the customers also stopped buying as much hardware too. Vendors weren’t worried about losing deals, they just weren’t being invited into deals anymore. The vendor response was “private cloud” and it came in the form of a bundle of vendor products with the word “cloud” attached. However these private clouds rarely exhibited NIST’s five essential cloud characteristics.

Private cloud had limited success, and some spectacular failures, while public cloud went from strength to strength and saw Microsoft chase AWS with billions of dollars of investment. The vendors then touted a hybrid cloud solution for customers to have “best of both worlds.”

However, this plan seems to be backfiring on the vendors because the public cloud providers that used to dismiss hybrid cloud as unworkable are now embracing it on their terms. For instance, AWS now offers a way to control on-premise private cloud; and Microsoft Azure is perhaps the most complete hybrid cloud with the same look-and-feel for private and public.

Hybrid Cloud Growth Challenges

There are a number of crosswinds and headwinds that are likely to see the forecast growth of hybrid cloud fail to meet expectations. Take the following issues for instance:

– Hybrid cloud is complex, takes a long time to get right, and is very expensive. You cannot just buy a hybrid cloud product; there’s no vendor with a single hybrid cloud SKU. It’s always a custom-built solution with all the issues that these IT projects experience in terms of under-estimating complexity, over-running on cost, and not meeting cloud-consumer needs. This slow execution rate will ultimately impact hybrid cloud adoption and the growth forecast.

– There is a lack of practitioners. A vast skillset is required to deploy a hybrid cloud. Beyond the myriad of technologies to integrate, both on-premise and in the public cloud, there’s the integration task to “bind” the clouds to make them hybrid. And the biggest challenge, that causes over a third of private clouds to fail, is modifying the organization’s operational model. Finding the team to do everything that’s required for hybrid cloud is hard, and it’s why companies such as EMC are training people to be Hybrid Cloud Solution Experts. But the reach of this well-intentioned training is just a drop in the ocean across the industry as a whole.

– Cloud appetites are changing. Industry commentators predict that application owner, and application developer, appetites are changing to move up the stack away from being in the infrastructure game. Application consumers, such as CRM users, are moving to Software-as-a-Service models. Application developers are moving to Platform-as-a-Service models. These might run on a private cloud but they are more at home in public cloud and there’s no requirement for hybrid cloud. These changing buying habits are again likely to dampen demand for hybrid cloud.

What’s the Real Outlook for Hybrid Cloud Growth?

In my opinion, the current hybrid cloud growth forecast, of 27% CAGR and 50% enterprise adoption, is too optimistic. The aforementioned headwinds and changing cloud appetites will dampen demand for hybrid cloud. It also remains unclear as to what hybrid cloud actually is. While technology vendors and cloud providers morph the abstract definition to match their portfolios rather than to what customers need, it will always be difficult to compare “like with like” in estimating the market for hybrid cloud.