A Look Into the Future: What Will the Cloud Industry Look Like in 10 Years?

Cloud computing has been around in aspirational form since at least the 1970s, when a famous diagram of ARPANET – one of the predecessors of the modern internet – included an icon of a cloud to indicate the networked connections between its different nodes. The cloud-adjacent concept of “thin clients,” i.e. computing systems with modest specifications that could connect to the resources of a more powerful centralized system, goes back even further.

But cloud as we know it didn’t really come into being until 2006, with the launch of Amazon Web Services (AWS). AWS was the first mass-market public cloud, capable of delivering immense compute, storage and networking resources on-demand to paying customers. Many similar Infrastructure-as-a-Service (IaaS) platforms emerged in the following years and the cloud computing model itself spread to almost every imaginable type of business software, from supply chain management systems to ERP solutions.

Today, cloud is a massive industry. Gartner has projected that public cloud alone will account for over $206 billion in revenue in 2019. MarketsandMarkets also foresees cloud ERP being a $37.7 billion niche by 2024. These are huge numbers, predicated on the idea that cloud computing technology will continue to evolve to adequately meet business demand. Let’s look into the crystal ball at what we think lies in store for the cloud industry over the next decade-plus.

1. The shift to serverless cloud

Cloud is fundamentally client-server computing, only at massive scale. Clients such as desktop and mobile applications make requests from servers managed by a cloud service provider (CSP). However, it’s possible that this straightforward setup may give way to what’s known as “serverless” cloud.

We should clarify that of course servers are still involved in this paradigm, but they’ve been greatly abstracted. Instead of procuring a server per se, a customer in a serverless world might request the capacity for a high-level service such as a particular database function, which the CSP’s infrastructure would then handle via dynamic allocation of resources.

In other words, the customer doesn’t have to perform traditional IaaS tasks such as load balancing or capacity planning. So it’s not so much that the server itself goes away, as that server management becomes less of a concern for end users.

It’s the logical progression of the ease of use that cloud computing services have already delivered for thousands of organizations worldwide, and one that many major cloud vendors are banking on. AWS, Google Cloud and Microsoft Azure all have some version of serverless cloud up and running.

 

2. Cloudifying legacy apps and environments

Cloud’s dominance of enterprise IT can seem like an inevitability in light of how quickly organizations have bought into public cloud services since 2006. At the same time, legacy apps still account for a massive share of all business software and porting them into the cloud or at least connecting them to some cloud services can seem daunting.

The widespread need to build a bridge between old and new computing environments has led to a surge in hybrid clouds (which connect public and private resources) as well as multi-cloud strategies. The 2019 State of the Cloud Report from RightScale found that the number of enterprises with a hybrid cloud in place increased from 51 percent in 2018 to 58 percent in 2019. More than 80 percent of surveyed organizations were pursuing a multi-cloud strategy.

Going forward, we should expect vendors like Oracle to play a major role in helping companies cloudify their existing environments and applications by connecting them to cloud services as part of a hybrid setup. Since Oracle already provides many of the mission-critical applications enterprise rely on (e.g., for ERP, transportation management and more), it’s well-positioned to play a part in the cloudification process.

We have a big on-premises tradition and history,” Bob Quillin, vice president of developer relations for Oracle Cloud infrastructure, told Light Reading. “Our Oracle cloud infrastructure is a huge advantage that AWS and Google are just starting to address. The tables are flipped.”

He means that cloud vendors are now, more than ever, looking to break into the enterprise. Vendors like Oracle with a foothold in on-prem IT may have an advantage over the cloud giants on this front, though.

3. More SCM functions in the cloud

In 2016, Oracle released a report with IDG Connect entitled “The Future for Cloud-Based Supply Chain Management Solutions,” which predicted an ongoing shift of SCM functions into cloud environments to close out the decade. It examined several specific functions and projected the share of each one that would be processed in the cloud within 2 years.

Here’s the rundown, by function with the 2016 percentage versus the projection:

  • Warehousing: 45% versus 54%
  • Supply chain planning: 40% versus 49%
  • Global trade: 40% versus 55%
  • Ideation and innovation: 33% versus 47%
  • Product lifecycle management: 30% versus 48%

The cited reasons for moving more SCM functionality into the cloud included faster implementations, cost savings, improved customer service, increased ability to leverage the power of the Internet of Things and greater security. Cloud adopters were also wary of a few possible disadvantages, including less control, new security concerns and issues with availability and accessibility.

4. Quantum computing possibilities

For decades, the principle of Moore’s Law – which holds that the number of transistors on an integrated circuit will double every two years – has reliably forecasted the steady improvement of computer processing power. Cloud environments have benefited from the greater speeds and efficiencies of CPUs over time.

But as chip capacity brushes up against the limits of physics, what’s next? Quantum computing is one possibility for further extending their power. Whereas classic computing has only two possible states for bits – either 0 or 1 – quantum computing allows for a much larger range of values by harnessing the power of quantum mechanics.

Computer scientists and physicists have been touting quantum computing as the next big thing for years, but it’s not clear yet when practical implementations of it will enter the mainstream. Some skeptics contend it won’t ever materialize, while others see a timeline of five to 10 years. Either way, it’s a development worth monitoring since it could potentially mean dramatic leaps in the power of cloud infrastructure.

Stay up to date on the latest in cloud, ERP and SCM

Inspirage is mindful of all of these trends affecting enterprise cloud. As you think about how to optimize your environment in the years ahead, we’re here to help. Check out our Resource Center for more information on our current projects, or contact or team directly for answers to any of your questions.

Arup Chatterjee

Arup Chatterjee | Key Contributor

Arup Chatterjee is Executive Vice President APAC and EMEA Consulting for Inspirage and is responsible for all business operations relating to Inspirage India-based workforce and facilities, including human resources, talent acquisition, finance, technology, business development and Strategy.