Cloud computing grows like a tiger

The economic downturn has once again exacerbated the popularity of cloud computing among companies.

During the economic downturn from 2008 to 2009, companies extended their hands to software-service (SaaS) providers. CFOs are happy to see the cost of building their own data centers and developing applications into the monthly costs of ordering software, calling on technology executives to join the cloud.

As we move forward for a few more years, technology executives have gone into the cloud. But one thing, like the 2008, is that people who fall outside the tide are encouraged to use cloud computing. At a time of economic downturn, the long and costly deployment of a project is not going to achieve the desired results. So 2008 years on, small and medium enterprises turned to cloud computing. In 2011 and 2012, large companies began to set foot in cloud computing.

Large software developers naturally have a hint. Oracle CEO Ellison The company's cloud computing and later acquired RightNow. Ellison sees where there is going to be a wave in the IT arena and is trying to bet on both sides.

Cloud computing may not be at all affected by the recession, and signs are beginning to become more pronounced. Rackspace, NetSuite and successfactors These cloud providers have shown no sign of slowing growth. Rest assured, Salesforce.com, chief executive Marc Benioff, will certainly talk a lot about the need to migrate to cloud computing when it publishes earnings reports on November 17.

"We are continuing to expand our cloud computing capabilities and see a growing need for software as a service," said Pierre Nanterme, chief executive of Accenture, who works on a large IT deployment project at the end of September. ”

Nanterme said: "We are implementing one of the world's largest software as a service project, involving 70 countries and nearly 20,000 users." "Let's look at what a few cloud companies are saying. These anecdotal rumours and data suggest that a large number of companies will flock to cloud computing in the future.

Rackspace CEO Lanham Napier in his company's third-quarter earnings report conference call:
In this quarter, the demand for cloud computing from the perspective of new customers or from the growth of old customers is strong. In the early development of Rackspace, our cloud services were adopted and recognized by our customers, which was mainly small and medium-sized enterprises. And those companies are still a vibrant group among the customer base of our company. At the same time, a growing number of big companies are discovering that using a professional service provider like Rackspace can be more efficient, faster, and cheaper to meet their IT needs. And we are optimistic that in the future, big companies will have a bigger share of our income sources.

From the first 9 months of this year, we did not see any significant slowdown in customer demand for our services.

Now, judging from the current business model, Rackspace is not so much a cloud-computing company as a hosting company. However, as large businesses need both cloud computing and hosting, the two businesses converge. Rackspace's cloud services revenue in the third quarter was $51 million trillion, up 89% from a year earlier, but still less than one-fifth per cent of the company's total sales.

Rackspace's financial reports reflect the big companies ' increased spending on cloud computing. The company added 8,884 customers in the third quarter, but this figure is less than the estimated 10,000 clients of the investment bank JMP Nomura. However, Rackspace's average selling price was higher than expected, to $6560 trillion, and the investment bank's estimate was 6500 dollars. Patrick Walravens, an analyst at JMP Nomura, said: "The average sales price is higher, which shows the popularity of Rackspace among large business customers." ”

Napier in particular that despite the economic downturn, Rackspace has bucked the trend, because the benefits of migrating to cloud computing have overwhelmed tight budgets. If you look at the growth of older customers this year, you will find that there is a steady growth momentum. Although it did not reach the 1.5% before the recession, but still reached 0.9%, the performance is still very eye-catching. Growth this year has almost doubled compared with last year. So people can not help but ask: what is the factor that makes this situation? Why is it able to maintain steady growth despite the poor macroeconomic situation outside? "There are several drivers," Napier said. The biggest driving factor is the business of our big business. ”

NetSuite also handed in a beautiful transcript in the third quarter. Why? NetSuite is moving toward the high-end segment of the market: looking from midsize companies to big companies. As big companies use NetSuite cloud services, the company's recurrent revenues will flow.

NetSuite chief executive Zach Nelson can speak on a lecture tour for big companies. At the Gartner Seminar in Orlando, he interacted actively with the audience at the stage. "As you can see, the market is starting to tend to cloud computing, and I saw it last year, and all these big companies are really making cloud computing strategies," Nelson said. ”

SuccessFactors chief executive Lars Dalgaard also believes companies will increase spending on cloud computing. Dalgaard also points out that SuccessFactors is concerned about the business: Business execution software is also counter-cyclical and unaffected by the economic situation. Dalgaard said:
We think the current economic environment is just an opportunity for us to help the company through a period of uncertainty. So in this environment, we come up with a counter-cyclical solution that enables customers to better understand the importance of combining a performance management strategy with a business strategy to ensure that all aspects of the company are efficient.

Turning to the cloud computing boom, Dalgaard said:
It is clear that Oracle's acquisition of RightNow is the strongest proof of the market's momentum; we knew from the start that the market would be developing well. We have been in the field of cloud computing for 10 years, but it is clear that traditional manufacturers cannot do cloud computing by themselves, so we have a unique opportunity to play this leadership role and help these big corporate customers around the world to successfully launch cloud computing.