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The cloud will drive innovation in 2016

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Cloud adoption grew within Australian organisations throughout 2015. This was largely fuelled by the cost and performance benefits that cloud computing offers IT departments. 2016 will see further growth, both from the maturation of cloud services, and organisational wisdom in driving business and commercial performance benefits from cloud infrastructures.  

Industry analysts, such as Gartner, Telsyte and Frost & Sullivan, all continue to predict expansion within the local cloud market. In Telsyte’s Australian Infrastructure & Cloud Computing Market Study 2015, it stated the market value for public cloud infrastructure services is predicted to more than double by 2019, reaching $775 million, up from $366m in 2015.

Cloud computing also has the attention of Prime Minister Malcolm Turnbull. The Government’s recently tabled and widely lauded $1.1bn innovation package promotes the adoption of new technologies such as cloud computing.

This push for innovation is well timed. As Equinix’s recent Enterprise of the Future Report showed, Australian businesses are continuing to look to the cloud to cut costs and drive efficiencies. 2016 will herald five major trends with cloud computing.

IT networks and the internet of Things

The expansion of the internet of Things (IoT) is continuing at an accelerated pace. From fitness trackers to driverless cars, and all the other digital gizmos being invented, their resulting flood of data will strain network security and capacity. This will compel more companies to redesign their IT networks to relieve pressures on established corporate-centric networks likely leveraging cloud services to deal with the explosion of data.

Multi-cloud growth to continue

Multi-cloud interconnection strategies are proving especially compelling when it comes to driving IT cost-efficiency. The recent Forrester study, The Total Economic Impact of Equinix Interconnection Solutions, shows that adoption of multi-cloud interconnection strategies can save more than $1m over three years. As more organisations recognise the cost advantages of multi-cloud strategies, the shift from housing critical applications on-premises to the cloud will accelerate.

Interconnected oriented architecture

Businesses will continue to look for ways to improve application performance. This quest will manifest itself with IT infrastructures re-engineered to reflect an Interconnection Oriented Architecture (IOA). Organisations will be investigating this model to directly and securely connect people, locations, clouds and data.   IOA shifts the fundamental IT delivery architecture from siloed and centralised to interconnected and distributed.

Digital commerce

New payment platforms and big data are combining with location-based services to create a new level of customised consumer targeting, offering retail businesses a huge competitive edge. Meanwhile, consumers will continue to expect more digital payment options in more places, at more moments — whether online or in-store. Despite the desired ubiquity and convenience, consumers also will insist that payments will remain secure.

Cybersecurity is critical

As more businesses move to the cloud, cloud security will continue to be a critical concern. Businesses will look for ways to bypass the public Internet’s significant security vulnerabilities in favour of direct and secure interconnection to other organisations and cloud service providers.

Australians have never been satisfied with the status quo. While cloud adoption within Australia continues to grow, 2016 will incubate innovation within the industry, delivering increasing business benefits from different cloud adoptions.

When looking ahead to 2016, it’s clear that businesses will continue to raise expectations for increased network capacity, improved cybersecurity and better cost efficiency.

Jeremy Deutscb is the managing director of Equinix Australia. Equinix connects the world’s leading businesses to their customers, employees and partners inside the most interconnected data centres.

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