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November 15, 2018

UK Cloud Infrastructure Spend Outstrips Legacy IT Spend for the First Time

"There’s a willingness to adopt these technologies [but] businesses are challenged by supply-side issues in the channel"

By CBR Staff Writer

Cloud infrastructure spending has surpassed spending on on-premises legacy IT infrastructure amongst UK-based organisations for the first time.

That’s according to a new report by the Cloud Industry Forum this week, based on a survey conducted by Vanson Bourne.

It found that UK organisations devote 19 percent of their IT budgets to cloud infrastructure, just ahead of the 18 percent spent on on-premise, and that by 2022, just 12 percent of IT budgets will be spent on legacy technology, as cloud usage increases.

cloud spendingGap Set to Widen

“This gap is set to widen significantly over the next three years as organisations decommission their legacy IT and ramp up their investments in next generation technologies,” the CIF said.

The news comes as one UK police force is next week set to unveil the UK’s first cloud-based police control room (watch this space for more), and five years after the government introduced a “cloud first” policy for all public institutions.

Read this: Exclusive: CyrusOne to Build THREE New London Data Centres

“When procuring new or existing services, public sector organisations should consider and fully evaluate potential cloud solutions first before considering any other option. This approach is mandatory for central government and strongly recommended to the wider public sector”, the policy says.

Multi-Cloud Also on Rise

The results further revealed that UK organisations are adopting multi-cloud strategies, with 75 percent of cloud users deploying two or more cloud-based services, and that 84 percent will increase their use of cloud in 2019 in pursuit of digital transformation.

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Alex Hilton, CEO of CIF, said in a release: “UK businesses clearly recognise the need for transformation and are gradually leaving legacy technologies behind in favour of next generation technologies as they pursue competitive advantage. Cloud is critical to this shift, thanks not only to the flexibility of the delivery model, but also the ease with which servers can be provisioned, which reduces financial and business risk. Furthermore, cloud’s ability to explore the value of vast unstructured data sets is next to none, which in turn is essential for IoT and AI.”

See also: AWS vs Azure vs Google Cloud: Who Wins on Latency, Performance?

He added: “However, it’s clear that the majority of UK organisations are right at the start of this journey and many are being prevented from exploiting IoT, blockchain and AI due to skills shortages, a lack of vision, and, indeed, a lack of support from vendors. The research further supports this idea as 15 percent of respondents reported they would struggle to find the right partner to assist in the implementation process, suggesting that while there’s a willingness to adopt these technologies, businesses are challenged by supply-side issues in the channel.”

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