Ten 2017 Cloud & IT Predictions: Movement, Transformation & Consolidation



Yep, it’s the end of 2016 and yep, it’s that time again to throw dust into the wind to see which way it’s blowing (or perhaps it’s metaphorically better to gaze up at the clouds to gauge their direction). As many of us tend to gravitate toward lists and categorizations, I’ll offer my 2017 cloud and IT predictions in much the same way. Loosely grouped, I see the following overarching themes: Movement, Transformation, and Consolidation.

2017 Cloud & IT Predictions - crystal ballAt the end of 2015, my colleague Mason Coffman offered his 2016 predictions and trends to watch this year. In fact, many if not all of these thoughts did play prominent roles in the digital transformation era we currently enjoy. And, I would say, many of these will continue to be priorities within 2017 as thoughts, processes, and technology continue to evolve.

In his article, the following five trends:

  • Hybrid IT will endure, and so will its complexity,
  • Leaders will demand adaptive security architectures,
  • The hyper-converged edge ends data storage at remote locations,
  • SD-WAN will give IT even more control and efficiency at the edge, and
  • IT continues to solidify its place as a value center, not a cost center.

I encourage you to re-read this piece and hold a magnifying glass to your own organization to see how your transformation performed this year.

For many, publishing a list of ‘predictions’ is an educated guestimate. Who, for example, would have predicted a massive DDoS botnet attack (well, perhaps those in-the-know would have and have probably been saying it for years)? Or the results of the 2016 U.S. Election (even those who analyze past results and data trends using robust analytics didn’t quite get it right)? Regardless, it is often required for corporations to plan for the future, take the most educated guess, analyze the trends, and even rely on their gut feeling to determine the best courses of action and where to devote funds and resources.

Crystal balls don’t exist. But if they did, they would be quite ‘cloudy’ (pun intended).

I’d like to up the ante on Coffman’s list and this year offer my ten trends and predictions for 2017. Briefly (and sections are linked for your convenience):

  1. Containers & microservices proliferate
  2. Digital transformation builds in size
  3. Clouds o’ plenty
  4. The network becomes front & center
  5. Cost leveling
  6. An abundance of apps
  7. Hyper-converging everything
  8. Massive migrations
  9. Getting smarter with AI & ML
  10. The movement of data

Any (or all of these) grab your attention? Truly, what is required for many if not all of these items is holistic, all-seeing management and visibility. But I digress.

Oh, and in terms of those overarching themes I initially mentioned (movement, transformation, and consolidation)? Many of my predictions below span multiple themes, but in order to provide some cohesion, here’s how I’d categorize the items above within each theme:

  • Movement – businesses are moving to and within the cloud as well as inter-connecting private and public infrastructure as a multitude of offerings become available; the transmission of data between the edge, apps, SaaS, data centers and clouds is increasing in volume.
  • Transformation – digital transformation remains critical to the enterprise; increased pressure on older networking infrastructure brings new and enhanced networking capabilities and services; containers and microservices enable new user experiences; artificial intelligence (AI) & machine learning (ML) push the boundaries of business intelligence.
  • Consolidation – infrastructure becomes increasingly hyper-converged; cloud and related service pricing become more squeezed approaching commoditization.

Let’s get into some details with some insights from various industry leaders (as well as a few of my own).

Containers & microservices proliferate

Much as the cloud was several years ago—innovative, disruptive and worth serious investigation—containers like Docker and CoreOS and a plethora of microservices today are enabling companies to do more types of innovation. Capitalizing off pre-packaged environments allows companies to focus on delivering user experiences rather than simply enabling products and services.

2017 Cloud & IT Predictions - containers & microservicesAs David Linthicum, Senior VP at Cloud Technology Partners and regular Forbes contributor, writes in his InfoWorld article, ‘containers will become a compelling design and technology pattern.’

‘But don’t expect to see IT containerize existing applications—it’s simply not happening. Why? Because containers may be a good fit for net new application, where IT can systemically work the container design into the application, but it’s costly and risky to rework existing applications for containers.’ – David Linthicum

In 2017, look for broader and deeper capabilities by current providers and many new boutique entrants providing specialized services. Also, greater integration within public clouds, the easier coupling and uncoupling of networking capabilities, and further abstraction of contained services will be prevalent.

Dimension Data, however, warns that while in 2017 there will be a more widespread adoption of containers, ‘the transition to a fully containerised world will take a few more years.’

Also, in 2017, as companies move to containerize or utilize microservices, look for internal pushback from security and compliance organizations, as well as a need to optimize networking, storage and monitoring for these types of services.

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Digital transformation builds in size

Digital transformation, the act of redefining/reinventing business processes coupled with technological innovations, continues to snowball. Enterprises have been transforming their business more quickly and those who haven’t kicked off these types of initiatives will feel the pressure from competitors to do so in order to stay relevant.

2017 Cloud & IT Predictions - digital transformationKevin L. Jackson, a globally recognized cloud computing expert and independent thought leader for IBM and Dell, presents the following advice for 2017:

‘The most important aspect of cloud computing lies in its ability to revolutionize business and economic models. The challenge is to avoid focusing on the technology in order to embrace the new opportunities it enables.’ – Kevin L. Jackson

Some advice for those corporations looking to ramp up their digital transformation (DX) initiatives for 2017: Remember that DX is, as Jackson points out, much more than just technology. I view DX as a complex mesh of:

  • Technology (cloud, Big Data, IoT, Mobile, Social, Networking, unified communications, etc.),
  • Business Processes (strategy, leadership, process), and
  • People (partners, suppliers, customers, employees, competition).

And digital transformation is unique to each organization. It is their DNA.

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Clouds o’ plenty

While the main public cloud providers—Amazon, Microsoft, and Google—will continue to battle for market share, smaller, specialized cloud providers will continue to grow, offering niche or vertical market capabilities. Cloud offerings will remain complex and companies looking to diversify their reliance and avoid vendor lock-in will choose blended or hybrid solutions, with some coupling to private cloud/data center infrastructure.

At the 2016 Structure Conference, MC Joe Weinman jokingly said: ‘the hybrid multi-cloud fog is the future.’ And Ofer Gadish, CEO and Co-Founder of CloudEndure states:2017 Cloud & IT Predictions - clouds

‘Enterprises will still be cautious with new, cutting-edge features offered by only one cloud platform as they are wary of being locked into one vendor and prefer to adopt more widespread functionalities.’ – Ofer Gadish

CIO’s Clint Boulton, in his analysis of Forrester Research’s recent predictions, states ‘CIOs who initially elected to build private clouds may find themselves switching to public clouds as they realize just how time-consuming and costly the work will prove.’ He adds:

‘The big players won’t be able to service every unique request, which means smaller regional players will see an uptick in adoption in 2017.’ – Clint Boulton

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The network becomes front & center

With the spotlight focused on clouds, microservices, containers and other innovative technologies, networking within clouds as well as cloud-to-private 2017 Cloud & IT Predictions - networkdata center connectivity will have increased focus in 2017. All too often, enterprises have relied on aging networking technology to ‘glue’ together a variety of services and infrastructures.

According to a Dimension Data article, the path to complete hybrid cloud integration—where some services run in a private data center while others in public clouds—has yet to hit that tipping point: ‘One of the major reasons why we haven’t achieved this ideal state yet is that the network elements in these hybrid domains have to be stitched together.’

Specific to the adoption of container technology, the author goes on to say:

‘Container networking is different from traditional networking. Containers are very dynamic and short-lived, giving rise to a lot of unpredictable traffic flow.’ – Dimension Data

To that end, networking technologies, whether in the form of SD-WAN, NFV or others, need to be flexible enough to embrace these types of development changes. Research firm IHS expects the datacenter and SDN market to grow more than 15-fold by 2019, paving the way for increased attention on SD-WAN and SDN providers.

Josh Dobies, VP of Product at Riverbed Technology, believes:

‘The WAN must continue to evolve toward a hybrid mix that combines the performance of on-premise hardware with the flexibility and elasticity of cloud-based network functions.’ – Josh Dobies

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Cost leveling

Over the years, the cloud has become increasingly commoditized, with price points on a variety of core services being pushed downward. However, researchers such as 451 Research believe that while prices continue to drop, they are not going down as quickly as people anticipated.

In a 451 Research study, commissioned by Microsoft in 2016, the largest reason for changing cloud providers was, indeed, price with 34% of respondents stating as such. ‘If there is a cloud price war going on, we are at the very beginning,’ say 451 Research analysts Owen Rogers and Carl Brooks.2017 Cloud & IT Predictions - cost leveling

‘Our conservative evaluation reveals that cloud providers are still making healthy profits on services, and aren’t yet slashing gross margins to attract highly price-sensitive end users. However, end users do care about price in that they don’t want to get ripped-off; we are still in a value-orientated market.’ – Owen Rogers & Carl Brooks

As pricing continues to drop for cloud and related services, pressures from within the enterprise toward public cloud providers will also squeeze potential savings from the equation.

CIO’s Boulton says ‘IT executives will get better at containing cloud costs in 2017 as their best practices mature.’

I believe 2017 will be a ‘buyer’s market’ for cloud computing as mega and smaller cloud providers maneuver to gain market share by offering innovative products at increasingly lower margins.

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An abundance of apps

In order to enhance the end-user experience for customers or employees, companies will continue to develop and/or refactor mobile and native applications, as well as push to enable more SaaS applications within their organizations. As the workforce and customers become increasingly mobile-enabled, those corporations who do not have a mobile-first strategy will be left behind the competition.2017 Cloud & IT Predictions - apps

However, care should be made when developing applications that rely on multiple clouds, microservices, and legacy hardware. Analyst firms like Forrester continue to recommend companies refactor their applications to run on public cloud systems, and many public clouds offer migration services to port apps to the cloud.

In 2017, more and more companies will undertake this heavy lifting, but many will find that lifting and shifting to the cloud does not bring the same results as architecting for the cloud. David Linthicum has this recommendation for AWS users:

‘…exploit the platform as much as you can. The idea that we can write applications that are not ‘cloud native’ means we’re not taking advantage of all that AWS has to offer. This means exploiting provisioning, scaling, native security, performance features, etc.’ – David Linthicum

But once apps are ported and/or refactored for the cloud, this doesn’t necessarily mean they will perform well, as many companies may be unfortunate enough to realize in 2017. Even large-scale adoption of SaaS may suffer as companies become dependent on slower, cheaper, and less secure public networks (which frequently don’t have SLA guarantees, by the way) over faster yet costly private (MPLS) networks to access these services. In 2017, enterprises will need to turn to systems that monitor and analyze network, application and even end-user experiences to ensure a positive result.

‘Since bandwidth is now more readily available and more affordable, the adoption of SaaS and cloud applications can happen so quickly that IT does not even know what applications are in use or who is using them. They also have less visibility into end-user experience and very little ability to manage the infrastructure and control application performance.’ – Josh Dobies

So, while there will be an insurgence of apps moving to the cloud and adoption of enterprise SaaS offerings, companies may need to spend some additional time and resources ensuring reliable and high-performance implementations of these items to obtain positive results.

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Hyper-converging everything

Hyper-convergence applies across pretty much all of the items within this predictions list whether it is hyper-converging edge infrastructure as Coffman predicted for 2016 or simply hyper-converged infrastructure (HCI) in general.

Forrester Research analyst Dave Bartoletti says ‘HCI is quickly becoming the default infrastructure platform upon which to build the private portion of a hybrid cloud.’ According to CIO writer Boulton, Forrester believes businesses will look to HCI as the foundation for private cloud deployments.

2017 Cloud & IT Predictions - hyper-convergenceTaj El Khayat, Riverbed’s regional vice president for the Middle East and Africa predicts ‘enterprises will realize that, for application, compute, storage, and networking infrastructure to work optimally, it all must work together, seamlessly, as a system.’

For successful hyper-convergence, companies will need to ensure they have embraced software-defined infrastructure in general. Companies will increasingly turn toward reliable, scalable and secure infrastructure environments in order to meet the needs of all, whether pushing or pulling data from or to the edge or datacenter or cloud. Sounds complex, doesn’t it? It is, which means companies providing visibility and control over HCI will fare well in 2017.

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Massive migrations

From lifting and shifting to companies diving completely into cloud adoption, 2017 will be record-setting for the number of companies utilizing cloud computing for the first time, those businesses actually expanding their cloud footprint to diversify across multiple clouds (preventing lock-in), or those simply growing their reliance on the cloud in general.2017 Cloud & IT Predictions - migration

Linthicum predicts the ‘great migration’ will begin in 2017 and believes there will be more workloads than ever moving to cloud-based platforms. Separately, he goes further to say, ‘public cloud providers will offer better tools, and enterprises will become more savvy about using them.’ But he also believes, which I echo, there will be huge bottlenecks along the way as companies encounter security, governance and compliance conflicts.

I believe as many companies rush to be cloud-enabled or even merely cloud-ready or simply work to enable a more robust mobile presence, they will attempt to shove a round peg into a square hole, meaning (and this is related to the lifting and shifting of apps) they will use the wrong cloud or service in the wrong way and will be surprised by sub-par performance. As Riverbed’s Dobies says:

‘To keep up with the complexity, pace, scale, and demand, IT must look at solutions that abstract communication resources and automate application delivery over the WAN. They need to have automated systems and orchestration that support those abstractions and thus facilitate alignment of IT with the needs of the business.’ – Josh Dobies

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Getting smarter with AI & ML

2017 will be a huge year for Artificial Intelligence (AI) and Machine Learning (ML). In fact, Gartner puts AI and ML at the top of their Top 10 Strategic Technology Trends 2017 report, stating:

‘AI and machine learning have reached a critical tipping point and will increasingly augment and extend virtually every technology enabled service, thing or application.  Creating intelligent systems that learn, adapt and potentially act autonomously rather than simply execute predefined instructions is primary battleground for technology vendors through at least 2020.’ – Gartner

2017 Cloud & IT Predictions - AI & MLML and AI are critical components to digital transformation; experts believe business intelligence can be derived from smarter analysis of data, enabling systems to comprehend, study, forecast, adapt and potentially run on their own. As things become smarter and more connected, obviously generating huge plumes of data (see below), transactional predictions and decisions will increase the pressure on the delivery of data, the networks attached to these devices, the computational systems, and the storage of data.

As companies focus on AI and ML to differentiate their businesses, they will increasingly turn toward services optimized within the mega clouds to ensure demands are met. In fact, some analysts believe the prices for cloud services specific to cognitive transactions will fall as organizations will utilize only these services explicitly, and not general cloud compute or storage services that are designed for more ‘rudimentary’ tasks.

However, the pressure on networks to deliver data analytics and results in near-real time, a requirement critical to successful AI or ML, will be tremendous. This will force companies using ML or AI services to optimize and monitor network availability and performance to and from these services and the intelligent devices or processes. 2017 will prove to be transformative for companies delivering WAN optimization, Edge networking solutions, and SD-WAN services.

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The movement of data

As described previously, data movement will be explosive in 2017, driven by corporations pushing data from the edge to the datacenter or cloud, by AI or ML generating petabytes of data, by companies migrating to the cloud from on-premise infrastructure, by corporations refactoring apps and creating new ones, and by the sheer number of connected devices (IoT) coming online.2017 Cloud & IT Predictions - data

According to AnalyticsWeek‘s, Jelani Harper,

‘IoT typifies the mobile capacities the cloud provides so robustly that it’s responsible for shifting the typical model for cloud computing which, heretofore, was largely centralized in nature. The preceding years evinced the need for edge computing and decentralized models in which gadgets at the cloud’s edge conducted straightforward, basic analytic capabilities.’ – Jelani Harper

So, while IoT devices on the edge do have limited computational capacity, data derived from these devices has to be transmitted, stored and analyzed within a centralized warehouse, whether in a traditional data center or, more recently, within the cloud. Most likely, this will not change much in 2017.

In 2017, the debate will continue as to whether data for IoT devices should be closer to the edge for faster processing or if cloud or data center storage with optimized transport pipes will deliver comparable performance. However, as AI and ML potentially generate exponential amounts of data and traffic as compared to IoT, the focus on optimized cognitive cloud services and transports will, as previously stated, be of highest priority with more reliance on cloud infrastructure than on edge environments.

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2017, explosive growth across the board

These 10 predictions and trends for 2017 are, in a couple of words, a bit overwhelming if you are tasked with driving your digital transformation initiatives forward. While it can feel like navigating an ice cutter through the ice, as you plow forward, obstacles will begin to break away, clearing a wake for your voyage.

My advice? Look to your peers who are already on this journey and learn what they would or wouldn’t do the next time. Understand your requirements. Make careful note of hurdles and mistakes that have happened in the past. Partner with providers whose expertise can guide you better in whatever element of change you are tackling. But make 2017 the year you get things done!


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