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Cloud-based infrastructure is a top ANZ priority in 2017

Projects involving cloud storage and back-up will feature strongly for CIOs based in Australia and New Zealand this year

This article can also be found in the Premium Editorial Download: CW ANZ: CW ANZ: CIOs set sights on cloud-based infrastructure

Cloud computing investments will top the priority lists for CIOs in Australia and New Zealand in 2017. According to Computer Weekly/TechTarget’s annual IT Priorities research, significant numbers of IT leaders are planning cloud initiatives in the datacentre, for storage and for back-up.

More than half of the ANZ IT decision-makers surveyed expect cloud services to be an area that sees budget increases in 2017 compared with last year.

The research found that when it came to primary storage, 41% of ANZ IT decision-makers were planning cloud storage initiatives. This far outweighed the second most popular primary storage initiative, solid state storage, which 20% plan to work on in 2017. For back-up, cloud also topped the priority list, with 36% of ANZ IT leaders planning projects around this. 

Cloud is also set to feature strongly in ANZ datacentre infrastructure initiatives this year, with 39% of respondents planning to work around hybrid clouds in their datacentres.

The Computer Weekly/TechTarget ANZ research also revealed that 54% of IT decision-makers expect cloud computing to be an area where budgets will increase. This compared with 38% who expect software budgets to increase, 35% who expect bigger IT staffing budgets, and 28% who expect more money for hardware.

These figures are all the more significant in view of the fact that 38% of the Australia and New Zealand-based CIOs surveyed expect their overall IT budget to be lower or flat in 2017 compared with last year.

Meanwhile, demand for cloud infrastructure and the availability of budget in this area is not being lost on suppliers. For example, the cloud services arm of Chinese e-commerce giant Alibaba recently added Australia to its datacentre footprint, with a centre in Sydney.

Australian organisations will be able to access Alibaba Cloud’s services, including cloud data storage, locally. Alibaba Cloud – previously known as Aliyun – has a team focused on building a cloud ecosystem with local tech companies in Australia.

More competition

Alibaba’s Sydney datacentre is one of four it recently opened across the world – the others are in Dubai, Europe and Japan. Australian organisations might welcome more competition in the cloud infrastructure market after Amazon Web Services’ datacentre in Sydney became unavailable for up to 10 hours for some customers after power was cut during a storm.

This demonstrated that even the world’s largest cloud computing platforms are vulnerable to periodic failure, which means enterprise cloud users must still consider business continuity planning, particularly for mission-critical applications.

Outsourced storage in the cloud could also help to offset falling IT staff and maintenance budgets. The Computer Weekly/TechTarget survey revealed staff and maintenance budgets as the most likely to fall in 2017. Nearly half (47%) of ANZ respondents expect their IT staff budget to be less in 2017 than it was in 2016 and 42% expect their maintenance budget to fall.

Signing up for cloud services delivered by the likes of Amazon and Alibaba Cloud could help counterbalance these budget cuts.

Blue-ribbon customers

Cloud service providers already have some blue-ribbon customers in the ANZ region. For example, the AWS cloud is used by Australia’s Commonwealth Bank.

In terms of overall ANZ IT budgets in 2017, the Computer Weekly/TechTarget research found that almost a quarter (24%) think their budget will be the same in 2017 as it was in 2016, and 14% expect it to fall. A significant 22% of respondents said they did not know what their IT budget would be in 2017.

On the other hand, 36% of ANZ IT decision-makers said they expected a budget increase. Some 15% expected a jump of more than 10%, 16% thought the rise would be between 5% and 10%, and 5% of IT leaders expected growth of less than 5%. This was a significant fall from last year’s survey, when 48% of IT leaders in the ANZ region said they expected IT budgets to rise.

Gartner has forecast enterprise IT spending in Australia to reach almost A$85bn this year, 2.8% higher than in 2016. Meanwhile, IT spending by organisations in New Zealand is tipped to hit NZ$11.5bn in 2017, a 2.4% rise. Both growth figures are just below the growth in global spending from 2016 to 2017, which is expected to increase by 2.9% and hit US$3.4tn.

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