Jeff Orr's Analyst Perspectives

I am happy to share insights gleaned from our latest Buyers Guide, an assessment of how well software providers’ offerings meet buyers’ requirements. The Cloud Computing Platforms Ventana Research Buyers Guide is the distillation of a year of market and product research by ISG and Ventana Research. Cloud computing has emerged as a fundamental technology driving the digital transformation of enterprises, irrespective of their size or maturity level. It provides a robust and scalable infrastructure that supports the dynamic needs of modern businesses, enabling them to stay competitive in a digital world. Three ways that cloud computing is essential to the ongoing operations, growth and innovation of an enterprise organization are operational efficiency, speed to market, and business continuity and resilience. Cloud computing offers on-demand access to a range of resources, including computing power, storage and networking capabilities. This eliminates the need for up-front capital investment in hardware for on-premises data centers and reduces the burden of maintenance and upgrades. Enterprises can scale their operations up or down based on demand, leading to significant cost savings and improved operational efficiency. With cloud platforms, enterprises can rapidly prototype, test and deploy new applications and systems. This accelerates the innovation process and reduces the time to market for new products and services. The cloud also supports advanced technologies like AI, machine learning and analytics, enabling businesses to derive insights and innovate faster. Cloud computing enhances business continuity and resilience. Data stored in the cloud is typically replicated across multiple servers in different locations, ensuring it is protected against hardware failures, natural disasters or other forms of disruption. Cloud providers also offer sophisticated security features to protect against cyber threats. Cloud computing is not just a technology, but a strategic enabler that underpins the digital capabilities of the enterprise. As the market evolves, multinational, regional and sovereign cloud providers will continue to play a critical role in shaping the enterprise software technology landscape. ISG Research defines Cloud Platforms as a software service for organizations to access virtualized IT resources via the internet on a pay-per-use basis. These resources include servers, data processing power, data storage, networking infrastructure, virtualization capabilities and more. Cloud platforms are an enterprise alternative to operating on-premises data centers and compute environments with an environment of networking and servers. Cloud platforms can be segmented into five main types: Public Cloud, Private Cloud, Hybrid Cloud, Multi-cloud and Sovereign Cloud. Each of these segments addresses unique needs of enterprise organizations and has gained prominence due to specific factors: Public Cloud: Public cloud services are provided by third-party providers over the internet and are available to anyone who wishes to use or purchase them. They offer scalability and elasticity unmatched by private or on-premises infrastructure, along with pricing models that convert capital expenses to operational expenses. The rise of SaaS applications and the shift towards digital business models have driven the adoption of public cloud. We believe that by 2027, over three-quarters of enterprises will operate across multiple public cloud computing environments, necessitating the requirement for a unified data platform to virtualize access for business continuity. Private Cloud: Private cloud refers to cloud computing resources used exclusively by a single business or organization. They provide a similar level of scalability and self-service as public clouds but within the confines of a company’s firewall, offering greater control over data, workloads and security. The need for businesses to have more control and security over their data has led to the prominence of private clouds. Hybrid Cloud: Hybrid cloud is an approach that combines a private cloud with one or more public cloud services, with proprietary software enabling communication between each distinct service. This model offers businesses greater flexibility by moving workloads between cloud environments as needs and costs fluctuate. The desire for flexibility and the need to leverage the benefits of both private and public cloud have brought hybrid cloud to the forefront of enterprise cloud strategies. Multi-cloud: Multi-cloud is the use of multiple cloud computing and storage services in a single network architecture. This refers to the distribution of cloud assets, software, applications and more across several cloud environments. With a multi-cloud strategy, enterprises can leverage the cloud environment that best meets the needs of a specific workload. The need for avoiding cloud service provider lock-in and optimizing each workload with the best platform has led to the rise of multi-cloud strategies. Sovereign Cloud: Sovereign cloud refers to a cloud infrastructure that is operated within the borders of a specific country and is compliant with its data sovereignty laws. It is often used by government agencies or industries with strict regulatory requirements. The increasing importance of data sovereignty and privacy concerns in many countries has led to the emergence of sovereign clouds. Each of these cloud segments has developed to address specific enterprise needs and concerns, such as cost efficiency, scalability, control, flexibility and regulatory compliance. As enterprises continue to change and grow, these cloud approaches will continue to play a crucial role in their journey. Cloud platforms continue to evolve, and the past year is no exception. The benefits of using a cloud service provider (CSP) over building on-premises servers include low capital outlay, faster time-to-market, agility and optimal cloud delivery models from Infrastructure-as-a-Service (IaaS) to Platform-as-a-Service (PaaS) to Software-as-a-Service (SaaS). While on-premises servers will not go away entirely, they must continue to compete effectively with cloud computing as an alternative for many applications and services. Cloud platforms are worth investing in because they serve as the backbone of modern IT infrastructure, enabling organizations to leverage a wide range of services from computing power and storage to AI and machine learning. Cloud platforms are worth investing in because they serve as the backbone of modern IT infrastructure, enabling organizations to leverage a wide range of services from computing power and storage to AI and machine learning. By migrating to the cloud, businesses can streamline operations, reduce costs and accelerate innovation. To meet the efficiency and innovation challenge, enterprises are expected to utilize multiple clouds. Investing time, people resources and financial resources in cloud platforms is a strategic move for enterprises aiming for digital transformation and competitive advantage. When an enterprise CIO or IT leader is considering a cloud platform, the choice between public, private, hybrid, multi-cloud or sovereign cloud should be driven by the organization’s specific objectives, goals and desired outcomes. Public Cloud: If the enterprise’s goal is to reduce IT infrastructure costs, increase scalability and improve operational efficiency, then a public cloud could be a suitable choice. It is also beneficial for businesses that need to quickly deploy and scale applications. Private Cloud: If the organization prioritizes data security, regulatory compliance and customization, a private cloud could be the best fit. It is particularly useful for businesses in highly regulated industries or those that handle sensitive customer data. Hybrid Cloud: If the organization seeks to balance the flexibility and scalability of public cloud with the security and control of a private cloud, a hybrid cloud could be the ideal approach. It is suitable for businesses that have a mix of sensitive and non-sensitive workloads. Multi-cloud: If the organization aims to avoid software provider lock-in, optimize workload performance and increase resilience, a multi-cloud approach could be beneficial. It is advantageous for businesses that use a variety of IaaS, PaaS and SaaS solutions. Sovereign Cloud: If the organization operates in a country with strict data sovereignty laws or is a government entity, a sovereign cloud could be the right choice. It is designed to meet specific regulatory requirements and protect national data sovereignty. A well-chosen cloud strategy can drive innovation, enhance customer experiences and provide a competitive edge in the digital marketplace. The choice of cloud platform should align with the enterprise’s strategic objectives and operational needs. It is also important to consider factors such as cost, resource availability, technical expertise and the potential need for digital transformation. A well-chosen cloud strategy can drive innovation, enhance customer experiences and provide a competitive edge in the digital marketplace. AI applications, particularly GenAI applications, have significantly transformed the Cloud Platforms landscape. GenAI applications require extensive computational resources, and cloud computing platforms provide the scalability enterprises need to allocate resources dynamically based on the needs of various GenAI workloads. This transformation has augmented the cloud computing market as the optimal choice for creating foundation models and deploying GenAI-powered applications. Each cloud platform segment also has advantages for GenAI workloads. Public cloud providers are investing heavily in AI and GenAI technologies, making them a good fit for enterprises looking to leverage these technologies. For enterprises with specific regulatory and compliance requirements, private clouds can offer a controlled environment to run GenAI workloads. Hybrid clouds offer flexibility, allowing enterprises to run GenAI workloads in the most suitable environment based on specific needs. A multi-cloud strategy can help avoid software provider lock-in and optimize each workload with the best platform. Sovereign clouds can meet the evolving and unique requirements of sovereign operations no matter the region they operate in. As GenAI continues to evolve, we can expect to see more AI workload-specific cloud platforms in the future. The rapid advancement of LLMs and foundation models is driving the continual evolution of AI and GenAI capabilities and enterprise use cases. Specialty cloud providers will become an important consideration for many enterprise cloud architectures. The emergence of domain-specific models, which can be compute-efficient, more compact and reduce the risks of general-purpose model hallucinations, further suggests a future where cloud platforms may become increasingly specialized. Our Cloud Platforms Buyers Guide is designed to provide a holistic view of a software provider’s ability to serve a variety of cloud workloads with a set of cloud platform products. As such the Cloud Platforms Buyers Guide includes the full breadth of deployment models, services and functionality. Technology vendors that provide public cloud, private cloud or hybrid cloud capabilities are represented in separate Buyers Guide research reports. ISG believes a methodical approach is essential to maximize competitiveness. To improve the performance of your enterprise’s people, process, information, and technology components, it is critical to select the right software provider and product. The five deployment models for cloud platforms include public, private, hybrid, multi-cloud and sovereign cloud. This Cloud Platforms Buyers Guide evaluates products based on services, deployment model and functionality. Service types include IaaS, PaaS and SaaS. The five deployment models for cloud platforms were previously referenced and include public, private, hybrid, multi-cloud and sovereign cloud. Functionality evaluated for cloud platforms includes storage, compute, database, networking, serverless computing, and artificial intelligence and machine learning (AI/ML). To be included in this Buyers Guide, products must include multiple functions, one or more services, and at least one deployment model. This Buyers Guide report evaluates the following software providers that offer products address key elements of cloud platforms to support a combination of public, private and hybrid cloud workloads: Alibaba Cloud, AWS, Google, IBM, Leaseweb, Microsoft and Oracle. This research-based index evaluates the full business and information technology value of cloud computing software offerings. I encourage you to learn more about our Buyers Guide and its effectiveness as a provider selection and RFI/RFP tool. We urge organizations to do a thorough job of evaluating cloud computing offerings in this Buyers Guide as both the results of our in-depth analysis of these software providers and as an evaluation methodology. The Buyers Guide can be used to evaluate existing suppliers, plus provides evaluation criteria for new projects. Using it can shorten the cycle time for an RFP and the definition of an RFI. The Buyers Guide for Cloud Computing Platforms in 2024 finds Microsoft first on the list, followed by AWS and Google. Software providers that rated in the top three of any category ﹘ including the product and customer experience dimensions﹘earn the designation of Leader. The Leaders in Product Experience are: Oracle AWS Google The Leaders in Customer Experience are: Microsoft Oracle AWS IBM The Leaders across any of the seven categories are: AWS, IBM and Oracle, which has achieved this rating in five of the seven categories. Microsoft in four categories. Google in two categories. The Hybrid Cloud Platforms Buyers Guide evaluates products based on services and functionality with a combination of public and private cloud deployment models. Service types include IaaS, PaaS and SaaS. Functionality evaluated for cloud platforms includes storage, compute, database, networking, serverless computing, and artificial intelligence and machine learning (AI/ML). To be included in this Buyers Guide, products must include multiple functions and one or more services on both public and private cloud deployment models. The Buyers Guide report evaluates the following software providers that offer products address key elements of cloud platforms to support hybrid cloud workloads: Alibaba Cloud, Amazon Web Services (AWS), Google, IBM, Leaseweb, Microsoft and Oracle. The Buyers Guide for Hybrid Cloud Platforms in 2024 finds Microsoft first on the list, followed by AWS and Google. Software providers that rated in the top three of any category ﹘ including the product and customer experience dimensions ﹘ earn the designation of Leader. The Leaders in Product Experience are: Oracle Microsoft AWS The Leaders in Customer Experience are: Microsoft Oracle AWS IBM The Leaders across any of the seven categories are: AWS, IBM and Oracle, which has achieved this rating in five of the seven categories. Microsoft in four categories. Google in two categories. The Private Cloud Platforms Buyers Guide evaluates products based on services and functionality with a private cloud deployment model. Service types include IaaS, PaaS and SaaS. Functionality evaluated for cloud platforms includes storage, compute, database, networking, serverless computing, and AI/ML. To be included in this Buyers Guide, products must include multiple functions and one or more services on a private cloud deployment model. The Buyers Guide report evaluates the following software providers that offer products address key elements of cloud platforms to support private cloud workloads: Alibaba Cloud, Amazon Web Services (AWS), Google, IBM, Leaseweb, Microsoft, Oracle and OVHcloud. The Buyers Guide for Private Cloud Platforms in 2024 finds Microsoft first on the list, followed by Google and Oracle. Software providers that rated in the top three of any category ﹘ including the product and customer experience dimensions ﹘ earn the designation of Leader. The Leaders in Product Experience are: Oracle Google Microsoft IBM The Leaders in Customer Experience are: Microsoft Oracle AWS IBM The Leaders across any of the seven categories are: AWS, IBM and Oracle, which has achieved this rating in five of the seven categories. Microsoft in four categories. Google in two categories. The Public Cloud Platforms Buyers Guide evaluates products based on services and functionality with a public cloud deployment model. Service types include IaaS, PaaS and SaaS. Functionality evaluated for cloud platforms includes storage, compute, database, networking, serverless computing, and artificial intelligence and machine learning (AI/ML). To be included in this Buyers Guide, products must include multiple functions and one or more services on a public cloud deployment model. The Buyers Guide report evaluates the following software providers that offer products address key elements of cloud platforms to support public cloud workloads: Akamai, Alibaba Cloud, AWS, DigitalOcean, Google, Huawei Cloud, IBM, Leaseweb, Microsoft, Oracle, OVHcloud, Tencent and Vultr. The Buyers Guide for Public Cloud Platforms in 2024 finds Microsoft first on the list, followed by AWS and Google. Software providers that rated in the top three of any category ﹘ including the product and customer experience dimensions ﹘ earn the designation of Leader. The Leaders in Product Experience are: Oracle Microsoft AWS The Leaders in Customer Experience are: Microsoft Oracle AWS IBM The Leaders across any of the seven categories are: IBM and Oracle, which has achieved this rating in five of the seven categories. AWS and Microsoft in four categories. Google in two categories. Huawei Cloud in one category. The overall performance chart provides a visual representation of how providers rate across product and customer experience. Software providers with products scoring higher in a weighted rating of the five product experience categories place farther to the right. The combination of ratings for the two customer experience categories determines their placement on the vertical axis. As a result, providers that place closer to the upper-right are “exemplary” and rated higher than those closer to the lower-left and identified as providers of “merit.” Software providers that excelled at customer experience over product experience have an “assurance” rating, and those excelling instead in product experience have an “innovative” rating. Note that close provider scores should not be taken to imply that the packages evaluated are functionally identical or equally well-suited for use by every enterprise or process. Although there is a high degree of commonality in how organizations handle cloud computing, there are many idiosyncrasies and differences that can make one provider’s offering a better fit than another. Our firm has made every effort to encompass in this Buyers Guide the overall product and customer experience from our cloud computing blueprint, which we believe reflects what a well-crafted RFP should contain. Even so, there may be additional areas that affect which software provider and products best fit an enterprise’s particular requirements. Therefore, while this research is complete as it stands, utilizing it in your own organizational context is critical to ensure that products deliver the highest level of support for your projects. You can find more details on our community as well as on our expertise in the research for these Buyers Guides: Cloud Computing Platforms Hybrid Cloud Platforms Private Cloud Platforms Public Cloud Platforms Regards, Jeff Orr

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