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Teradata eyes cloud opportunity in APAC

The data warehouse software supplier has been positioning itself to capture the region’s cloud opportunities through not only R&D, but also efforts to support enterprises in their cloud journey

Teradata is setting its sights on the cloud-based data warehouse market in Asia-Pacific as cloud adoption in the region ramps up beyond infrastructure services.

In an interview with Computer Weekly, Keith Budge, Teradata’s executive vice-president for Asia-Pacific and Japan, said the company has been positioning itself to capture the region’s cloud opportunities through not just research and development (R&D), but also efforts to support enterprises in their cloud journey.

“From this year onwards, we’re shifting 75% of our R&D spending to cloud, and that represents about $200m of design and engineering expenditure,” said Budge, noting that Teradata will continue to develop and enhance its product functionalities as well as integration with public cloud services.

So far, the supplier has teamed up with major cloud hyperscalers including Microsoft Azure, Google Cloud and Amazon Web Services to make its data warehouse software available for enterprises to run cloud analytics initiatives.

Budge said integration with third-party cloud services through application programming interfaces and software development kits will also become increasingly important as enterprises move more of their data and workloads to the cloud.

This is done through engineering tie-ups with cloud providers to address certain requirements, including the architectures that enterprises will need as they move to the cloud and the best way to support cloud migration efforts.

In its 2020 financial year, Teradata grew its public cloud annual recurring revenue (ARR) to $106m, a 165% increase from the end of 2019.

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On the heels of its strong performance last year, it expects annual growth of at least 100% in cloud ARR, as well as year-over-year growth in total company revenue, profitability and free cash flow in 2021.

In Asia-Pacific, led by the key markets of Japan and Australia, Teradata’s cloud revenue is growing at high rates, said Budge, without revealing specific growth figures.

“Our lead market for cloud in the region today is Japan, which is interesting because they are rapidly shifting to cloud which hasn’t always been the case,” he said.

Budge admitted that the pandemic has helped, as Teradata’s customers have had to rely a lot more on their data, which grew over the last 12 months.

“We’ve also had the trust of our customers for many years and our ability to provide technical and migration support even during a pandemic has continued to be pretty good,” he added.

Born-digital firms

Across the region, where cloud adoption varies widely, the keenest users of cloud-based data warehouses tend to be born-digital firms and startups – though some traditional large enterprises, such as banks, have caught up.

“Banks are very interested in risk and return analysis, so we’re helping them to leverage their data assets to do that,” said Budge. “The automotive industry is also leveraging data in areas ranging from procurement to the manufacturing process.”

For many large organisations, the hybrid cloud model is still preferred, and Budge believes Teradata’s ability to support workloads wherever they are gives it an edge over public cloud-only data warehouses.

“That we can support workloads running both on-premise and on cloud, and accessing on-premise data from the cloud and vice versa, is really important to a lot of our customers because it’s a journey,” he said. “And it’s a journey that will take some years, so you can't immediately throw everything to the cloud and hope it’ll work.”

To assuage security concerns around the use of its cloud data warehouse, Teradata works with customers in regulated industries to obtain the necessary approvals before they can move data and workloads to the cloud.

Budge said Teradata has also applied its on-premise level of data security to its cloud-based offerings and invested in third-party audits to comply with data protection and security standards including the General Data Protection Regulation, ISO 27001, as well as SOC 1 and 2.

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