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India builds on its strength for cloud computing infrastructure, Ernst & Young Survey

Currently, the Indian market does not have a mature ecosystem that supports cloud IaaS.

Market Press Release – September 2, 2010 8:34 am
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Key highlights:

* 81% of Indian CIOs are familiar with cloud computing concepts
* 72% Indian CIOs cited data privacy and security issues as a concern area for their business while adopting cloud computing services
* 58% Indian CIOs consider ability to focus on core activities and usage based payments as the top business benefits of cloud computing services
* 92% of India CIOs are inclined to buy cloud services from data center service providers and IT systems integrators

Mumbai, 18 August, 2010: Over 72% of India’s IT infrastructure companies will adopt cloud computing in a big way over the next 2-3 years, according to a new study by Ernst & Young.

The study titled “Cloud adoption in India-Infrastructure as a Service (IaaS)” is based on interviews with 50 chief information officers (CIOs) from leading SMB, enterprises and IaaS ecosystem players.

According to Milan Sheth, Partner, Technology Advisory Practice, Ernst & Young, “We have seen significant interest in the potential of IaaS for the Indian market across industry segments. Virtualization, often seen as the first step in a cloud strategy, has begun to be more widely implemented across data centers and this could contribute to a rapid implementation of IaaS in India.”

Currently, the Indian market does not have a mature ecosystem that supports cloud IaaS. The SMB segment considers cloud IaaS for its “true” benefits while large enterprises perceive benefits on the operational side that are generally derived from an outsourcing model. Over 68% of the respondents have a positive mindset towards cloud computing, with 24% regarding it as a driver of the next wave of IT innovation and 44% believing that it will mature in a few years. Interestingly, cost is not the decision factor for adoption of cloud IaaS.

“The ongoing impact of open source, the whole concept of SaaS meeting the cloud, will prove to be a major trend for cloud adoption in India. With high awareness levels and the positive perception of cloud indicate a market that will see robust growth rate in the next 2 years,” Mr. Sheth added.

Ecosystem maturity, customer awareness of services and connectivity are identified as the major challenges for adoption of cloud IaaS in India. Vendor maturity and the capability to provide cloud services are an area of concern in addition to generally associated challenges for shift while adopting cloud IaaS.

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