Cloud computing is hard for companies to quickly popularize traditional It giants such as HP

December 4 News, according to foreign media reports, at the end of this year, there are more signs that next year, the adoption of cloud computing technology companies will quickly increase. This year, corporate understanding, acceptance and trust in cloud computing have reached a milestone, and the attitude towards cloud computing has shifted from FUD (worry, uncertainty and suspicion) to a rigorous review of return on investment. Once the enterprise will apply, and even the entire data center to the cloud computing technology, it giants performance will be seriously affected. If customers take advantage of cloud computing services to replace their hardware and data centers, the financial performance of technology giants will be significantly affected.

Predicting the growth of cloud computing is not uncommon. For example, market research firm IDC recently predicted that the cloud computing market would grow from $56 billion trillion (about 343.7 billion yuan) this year to $127 billion trillion (about 779.5 billion yuan) in 2018, with an annual compound growth rate of more than 22%. SaaS (software as a service) accounts for about Two-thirds, but IDC predicts that infrastructure services will grow at a higher rate: from less than $9 billion trillion this year (about 55.2 billion yuan) to 4 years later, about 25 billion dollars (about 153.4 billion yuan), with an annual compound growth of 30%. IHS, a market research firm, predicts that businesses will spend 35% more on cloud infrastructure and services over the next 3 years.

Cloud computing growth means it giants are hurting

HP's recent release and fourth quarter results show the impact of cloud computing on traditional IT giants. Hewlett-Packard conglomerate revenue fell 4%, corporate software group performance worse, revenue down 7%. HP's peers IBM, Oracle and even Cisco have not been able to avoid the effects of cloud computing. Even if HP increases service revenue through more powerful cloud computing products, it will not make up for the impact of the hardware business because the profit margins of the cloud services business are usually fairly low. HP Enterprise Group profit margin is 15%, service business profit margin is below 7%. In other words, HP's hardware business costs 1 of billions of dollars in revenue, and service businesses need to add more than 2 dollars in revenue to keep profits from being affected. Cloud computing subversion is not only a mature business model, but also eats up big it soft, hardware manufacturers profit.

Cloud computing is changing infrastructure sourcing because service giants such as Amazon, Azure, Facebook and Google design and equip data centers differently from enterprise IT departments. Most enterprise IT departments purchase hardware products from a well-known hardware manufacturer, such as HP, increase price negotiation weights, reduce staff training costs and improve efficiency. By contrast, cloud services vendors have been more direct buyers of Asian manufacturers without a branded system, reducing links.

This year, the enterprise's use of cloud computing is no longer limited to non-critical test/development systems, but is a core part of IT business. More and more companies are migrating the entire IT business to AWS and Salesforce.com.

The factors that affect cloud computing's popularity may not be demand, but the shortage of professionals who can master cloud computing integration and management skills.

The resistance to cloud computing technology is rapidly falling apart, as a result of the pressure from executives and shareholders to increase efficiency and customer demand for more functionality and convenience, as a consequence of the unprecedented number of companies adopting cloud computing technology next year. The popularity of cloud computing is so rapid that traditional it vendors may not understand this impact on their business next year.

(Responsible editor: Mengyishan)