If you’re encountering difficulties pitching your cloud-based solution to your customers, this latest survey released by Microsoft Canada will probably tell you why.
No less than 90 per cent of Canadian C-suite executives “are not familiar with what cloud computing means,” according to the findings of the survey commissioned by the company. Two-thirds of respondents are “only just beginning to familiarize themselves” with the cloud. Of the 10 per cent that said they are familiar with cloud computing, fewer than half (45 per cent) were able to select the correct definition for the terms from a list of choices presented to them.
The survey was conducted by Northstar Research Partners, a Toronto-based market research and consulting firm. The survey involved 476 C-suite executives in private sector businesses including financial and professional services, retail, oil & gas, constriction and telecommunications companies. The survey is considered accurate to within plus or minus five percentage points 19 times out of 20.
“I think the findings reveal a disconnect between what cloud really is, what it offers, and how it is perceived by Canada’s C-suite decision-makers,” said Janet Kennedy, presidents of Microsoft Canada. “For many of them, especially in smaller business, exactly what the cloud is remains unknown but the bottom line benefits are highly valued – bigger profits, better services, lower costs and a more satisfied customer base.”
Janet Kennedy
Security ranked on the top of list of concerns posed by Canadian executives:
- As many as 65 per cent of senior executives said they do not feel secure sharing their business data and information with a cloud service provider
- Nearly three quarters of respondents (72 per cent) said they would be uncomfortable sharing confidential strategic plans in the cloud
- As many as 45 per cent felt their company`s information would be unsafe in the cloud
She said this lack of awareness of cloud benefits coupled with “persistent concerns” about data security is “holding Canadian businesses back.”
The survey also brought to light a significant difference between how small businesses and large companies view cloud-based solutions.
- Overall, 43 per cent of Canadian executives think cloud computing is only for large organizations
- Forty five per cent of small business executives ascribe to this belief
- As many as 61 per cent of small business executives said they are not involved in or are even discussing any move to cloud computing. By contrast, 74 per cent of medium and large enterprise executives said their organizations are discussing cloud options
- Four in 10 of 36 per cent of executives in small companies said they do not know what cloud services are used for
- One third of executives in small businesses admit to “not having a clue” what cloud computing really is
This seems to be a big departure from the optimism about cloud computing that surfaced last year when CDN’s parent company IT World Canada, conducted a survey of small and medium sized businesses (SMBs). Out of the 350 It decision makers polled, 54 per cent said one of their priorities for 2014 would be to embark on a cloud computing project.
Kennedy said the findings of Microsoft’s survey indicate indicate that vendors and providers have their work cut out for them when it comes to pushing cloud adoption.
Tony Olvet
“The data suggests the cloud is viewed by small business leaders as a large and potentially costly mystery – but the reality is that virtually all of them are utilizing cloud services in at least one aspect of their business operations already, whether it’s email, hosted data storage or collaboration tools,” Kennedy said.” They’ve got their toes in the water already; we need to better convince them to take a full plunge.”
It’s a different picture altogether in the channel space. A recent study on cloud adoption conducted by CDN and analyst group IDC Canada portrays a robust attitude towards cloud computing in the space.
Called Reaching for the Clouds: CDN and IDC Canada’s Cloud Impact Channel Study, the report found that majority of Canadian technology partners expect cloud technologies to make up 48 per cent of their revenue by 2015, that’s up from 33 per cent of revenue in 2013.
The CDN-IDC survey found:
- As many as 48 per cent of partners are executing on a cloud strategy
- Just 13 per cent said their cloud strategies were fully executed
- About 35 per cent said they are at the early execution state
Respondents said that by 2015 they foresee:
- Traditional customer on-premise IT projects will comprise 38 per cent of their revenue
- Outsource IT/application management/hosting that are not cloud-related with make up 14 per cent of revenue
- The rest of revenue will come from a mix of enterprise private cloud, hosted private cloud and public cloud
Channel partners are involved in multiple cloud deployment models. While private cloud is the most popular deployment model for 2014, partners said the big money maker for them is the public cloud. They expect higher margins from private cloud to drive their cloud business revenue.
Another survey by IDC Canada found that Canadian organizations consumed more than $1.3 billion worth of cloud services in 2013. The services ranged from email, customer relationship management to platform-as-a-service (PaaS), according to David Senf, infrastructure analyst for IDC Canada. Back then, the analyst firm predicted that Infrastructure-as-a-service would post a much higher growth than Software-as-a-service even if cloud in Canada is largely focused on SaaS.
This year, SaaS appears to be the leading public cloud space in the channel, according to Tony Olvet, group vice-president of research with IDC Canada.
“Software-as-a-Service rather than infrastructure is the biggest piece of public cloud business that we’re hearing from partners,” said Tony Olvet, group vice-president of research with IDC Canada. “…that was a bit of a surprise for us. A couple of years ago it was all about infrastructure.”
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The dark cloud over the Internet is the US government. Until we have our own data centers on Canadian soil under Canadian laws, the fox guarding the henhouse is no invitation for any business. Are you listening Microsoft et al.?