Cloud Computing Forecast: 10 Trends to Look Out For in 2016

Happy New Year!

ElasticHosts and cloud computing, in general, had an exciting year in 2015 and we expect nothing less from 2016. Since the new year is still young, we feel it is time to make our predictions of what is ahead of us in cloud computing. Here we go:

  1. Linux containers brought a game-changing approach to application deployment, and they might become the new norm in 2016. They are great modern alternatives to hypervisors for full OS-level virtualisation and IaaS. With full OS-level virtualisation, cloud providers can run a complete copy of Linux inside a container, just as you might run it inside a VM today. And this represents better performance, lower costs and scalability advantages.

  2. With Linux containers gaining momentum, companies are able to enjoy absolute flexibility in pricing. We have announced our take on the new container technology, Elastic Containers, which can adapt automatically to fit volatile shifts in demand for resource and bill our clients accordingly. To see how the true utility-based billing works, check out the Springs website.

  3. By offering true pay-per-use billing, cloud infrastructure services will have everything in place to evolve into a mass market. Automatic scaling will bring companies of all sizes to the table: it’s extremely cost-effective and requires minimum to zero initial investment and low management of computing resources. As a side-effect, the good old web hosting business - and deformities, such as managed WordPress services - will get in a tight spot. We won’t miss them.

  4. Using cloud for infrastructure will be mandatory for companies. Bernstein Research estimated $128b spending went to the cloud globally in 2015 and swallows 60% of the spending growth this year - which will increase to 100% by 2018. Global Industry Analysts suggest IaaS will be the main driver behind this growth - no surprise since over 80% of enterprises globally will be using IaaS. Impressive figures.

  5. Asia-Pacific is the region to watch in 2016. It’s one of the fastest growing regional markets for cloud computing services, with revenues waxing at a CAGR of about 35% from 2014 to 2020. The growth is fueled by both enterprises and SMBs in emerging markets such as China and India. The United States will remain the largest regional market worldwide, but Asia-Pacific might catch up with Europe in a couple years. We have registered this trend ourselves, and we have opened two data centers in Asia-Pacific in the past years: in Hong Kong and Sydney.

Data center in Tokyo, Japan

  1. A recent ruling by the European Court of Justice made the Safe Harbour agreement invalid between the EU and US, thus rendered companies operating in both regions uncertain about cross-border data transfers. Certain countries have gone even further, namely Australia and Germany, are keen on keeping their citizens’ data within the country. These developments point to the same direction: regional and local data centres will gain unprecedented prominence in the future. This will have the additional benefits of making the transition from in-house infrastructure to the cloud smoother and reducing latency towards end-users.

  2. If cloud computing bingo was a thing, IoT and Big Data would have their names on it. But they are more than buzzwords: last year, Big Data investments accounted for nearly $40 b in 2015 by SNS Research’s estimation and these investments are likely to grow at a double-digit CAGR over the following years. All the while the global adoption is hindered by privacy and, very real, security concerns.

  3. A recent survey showed two-thirds of IT pros are chiefly concerned about security and privacy of sensitive data when it comes to the cloud. Security experts agree that cloud security spending will outpace overall security spending in 2016 because currently there is a gap between how involved companies are with the cloud and how much they invested in keeping their cloud safe.

  4. Companies finally start to ease into using the public cloud slowly and the mass adoption of hybrid clouds will play a pivotal role in the process. Cloud providers will focus on this segment and take extra steps to mitigate the interested companies’ possible concerns. Hardships can’t be completely avoided but the cost saving and extra speed will convince the hesitant.

  5. It might come as a surprise, but it’s highly likely that SSDs will surpass HDDs in capacity in 2016 and some suggest that by the end of 2016 the price parity will be close, if not already achieved. If this proves to be true, data centres could rapidly replace their remaining HDD drives to flash storage.

###Would you add something to the list?

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