Why Australasia will be ahead in hyperscale cloud adoption


By Rob Purdy

Gartner recently released its Predictions on IT spending in 2015. In it, a Research Vice President in Gartner’s Technology and Service Provider Research group, John-David Lovelock, made what some would consider a bold prediction about the hyperscale cloud: “The next inflection point [for hyperscale cloud] will come in 2018, when the needs of digital business will surpass the capacity of traditional data centres, which will be seen as too slow and siloed.”

Lovelock’s prediction encompasses all geographies so he’s probably correct, but after reading the report I tweeted that in Australasia it’s likely that date will be earlier. That’s probably an even bolder statement than Gartner’s initial prediction – but here’s the reasoning.

In ANZ we’ve always been early adopters. When we look back at the evolution of IT, Australasia has always adapted quickly when technology has either provided compelling savings or enabled businesses to move faster. One of the best examples of this was the rapid, and early, adoption of virtualisation in the data centre. Even now, VMware will confirm that the Australasia region leads the world in virtualisation with around about 80 percent of data centres using either some or extensive virtualisation.

Around the business we have few customers who aren’t asking how they can utilise cloud services, who aren’t already actively assessing migrations or who haven’t already begun migration programmes to Datacom’s cloud service or public clouds. This seems to be especially true on the east coast of Australia.

Due to geographic challenges, South Australia, Western Australia and New Zealand are likely to be slower in adoption of public cloud providers, specifically IaaS.

When it comes to SaaS-based applications like Office 365, I’m expecting large-scale adoption over the next few years as Microsoft creates attractive bundles under Enterprise Agreements and the announcement of Australian in-country services removes a number of the previous barriers to adoption. There are a few hurdles that remain, like the patriot act for example; however in my role I’m in constant contact with Australian and New Zealand Governments and it’s clear that at a national level they are becoming more open to allowing departments/agencies leverage the hyperscale cloud where it makes sense.

For the Australian market, the opening of Microsoft Azure in Melbourne and Sydney triggered a switch in most companies’ minds. They now believe the public cloud is a viable option for enterprise workloads.

That’s not quite the case. Some older applications just aren’t suitable for public cloud platforms due to the way public clouds deal with failure of services – i.e. they rely on the application to deal with the failure whereas traditional applications have relied on underlying infrastructure (like VMware/HyperV) to maintain service.

But it’s clear that the public cloud providers are starting to understand and are beginning to introduce services that address this challenge. Amazon Web Services (AWS) announced recently that it has introduced ‘HA’ and Google already supports live migration for maintenance programs so that applications aren’t disrupted if the underlying hardware is under repair. Hyperscale providers (AWS, Azure and Google) are only going to step up their services to enable enterprise workload support, which will speed up the move to use hyperscalers for core IT systems.

Lydia Leong tweeted recently, ‘I dub 2015 the Year of Carnage, when a large number of service providers exit or significantly pivot their cloud IaaS business.’

I couldn’t agree more with Lydia however Datacom has already completed this journey, encouraging customers to assess hyperscalers as an option for workloads.

Datacom this year celebrates its 50th year in IT services and the reason we’ve continued to grow is by embracing new technology and providing independent guidance to our customers faster than our competitors.

In 2013 I started a pivot in our business to move from purely selling our own Cloud IaaS service to supporting a Hybrid Cloud approach with the hyperscalers. This change in strategy has enabled our customers to place their workloads in the best location to provide the best business outcomes. We also have a highly skilled workforce of more than 800 software developers working hand in glove with our infrastructure experts to support a unique, robust customer experience on any cloud platform.

Public Cloud spending surpassing traditional data centres more quickly than expected doesn’t mean that en masse people are going to move to Public Cloud services. There are customers who will continue to believe that the risk and the cost to move aren’t be justified, or that their business model doesn’t fit with a Cloud/Operational expenditure. On-premise just won’t go away – those workloads aren’t moving to public cloud anytime soon.

So for at least the next five years we’re into a hybrid world. But clearly the traditional vendors (VMware, IBM, HP, Microsoft) will be touting that their public cloud revenue to meet the expectations of Wall Street.

Rob Purdy is Director of Cloud and Enterprise Tools at Datacom Australia. 

Our blog is an open platform for leading thinkers’ right across our business. The views and opinions expressed are those of the author(s) are their own and do not always imply endorsement by the Datacom Group.

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