Anyone who follows technology news—or reads Wall Street bulletins—likely has heard that several cloud computing stocks took a beating in the market in early February, as a few companies lowered their guidance for 2016. At first glance, this might cause business leaders to wonder if cloud computing has hit its peak, and whether it is wise to continue moving resources—and technology funding—to the cloud.
The answers to these questions are a resounding “No,” and “Yes!” Although the economic growth surge of some cloud-based businesses may be slowing, there is no doubt that the future of computing still lies firmly in the cloud. A perfect case in point is Microsoft, an organization that is struggling with its desktop business even as its cloud computing solutions, such as Azure and Office 365, continue to soar upward.
When Microsoft announced its fourth quarter results in early February, it noted that its cloud revenue grew 127% in the quarter. The profitability of Microsoft’s cloud business isn’t very impressive, at least in part because it is currently spending a lot of money wooing organizations over. However, the potential of the cloud, for Microsoft, is unlimited.
Microsoft, like many technology providers, sees that the cloud is a realistic solution, not only for fulfilling their customers’ needs but also for meeting their own. As applications and operating systems become more dynamic, platforms must move as fast as the industry does. Given the cost of supporting myriad individual installations for each customer, and the complexity of supporting them in environments that may not have been fully tested, the consistent, predictable ecosystem of a properly built and maintained cloud environment is undeniably enticing—for both providers and their customers.
The takeaway for business decision makers is that we are only beginning to see the cloud realize its potential. Even given the investments required to move to cloud computing (for a customer) or to build out an infrastructure (for a provider), the reality is that over time, cloud computing is a much more efficient model than traditional, on-premise computing.
In late December, one cloud expert predicted that 2016 will see the acceleration of specialized cloud solutions targeted to further increase organizational efficiency, along with a continued focus on compliance. We couldn’t agree more. We are confident that 2016 will see even the most reluctant companies begin to find their footing in the cloud.