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The Cloud’s Close-up: What’s Next for 2024?

by | Dec 14, 2023 | T.E.M. Thought Leadership

Data from the cloud computing industry in the last two years points to a juncture in 2024. In 2022, 26% of people reported using multiple public clouds, up from 21% in 2021. Hybrid cloud use also jumped from 25% to 42.5%, per Google Cloud. Cloud adoption among enterprise organizations is over 94%.

The industry’s growth is also reflected by the increase in IT budgets for both public and private cloud. For instance, according to a recent PwC’s 2023 Cloud Business Survey, 78% of executives responded their companies have adopted cloud in most or all parts of the business.

But what will 2024 bring?

As we stand on the precipice of the new year, it’s clear from the data that the challenges and opportunities in cloud computing are more pressing and transformative than ever before.

This post aims to offer insights into the top cloud challenges that businesses are poised to encounter in 2024—especially for small to medium-sized businesses (SMBs). We also aim to provide a solution for facing financial challenges so you can navigate the cloud’s future with strategic foresight.

But to understand what’s coming, we must first know where we are.

Current State of Cloud Computing

Once relegated to a peripheral role in data storage, the cloud has become the bedrock of our digital existence today; the industry’s current state can be characterized by rapid growth, widespread adoption, and the emergence of new trends. From IoT to blockchain and quantum computing, the interconnected network of technologies the cloud supports highlights its transformative potential.

Regarding market size, Gartner forecasts worldwide public cloud spending to reach over $600 billion this year. Adoption rates have also skyrocketed, with over 98% of organizations using the cloud in some way. The majority of business workloads, approximately 94%, are processed using cloud technology. Cloud computing platforms have also seen a significant rise in modern application development.

Current trends that help shape the future of cloud computing include:

  • Multi-cloud and hybrid cloud environments are being adopted by organizations to support workloads that require a vendor-agnostic, multi-platform approach.
  • Increased investment made in cloud security and resilience due to the inherent risks and challenges associated with cloud environment growth.
  • AI and machine learning (ML) are being integrated into cloud computing in various ways to enhance efficiency, performance, and innovation across different industries.
  • Edge computing is playing a crucial role in supporting cloud AI deployments by allowing cloud providers to roll out their models closer to end users, enabling ultra-fast queries and responses.
  • Cloud-native platforms, like serverless computing, allows for applications to be executed without the need to manage servers, reducing infrastructure costs and simplifying management and maintenance.

Anticipating a Paradigm Shift in 2024

Entering 2024, the role of cloud computing is changing significantly — it’s not only about saving costs anymore. In this shift, the cloud is more than a tool; it’s a force for change, shaping the future of business in ways we haven’t seen.

Beyond cost savings

The cloud is now seen as a driver for organizational growth and gaining a competitive edge. CFOs aiming for financial efficiency understand that cloud computing isn’t only about cutting costs; it’s an investment in future capabilities. In 2024, the cloud will become more versatile and break free from industry limitations. As such, the rise of diverse use cases challenges the notion of cloud computing as a one-size-fits-all solution.

Consequently, IT Directors responsible for aligning technology with organizational goals are delving into these emerging use cases. They aim to customize cloud solutions to enhance operational efficiency and cultivate a culture of innovation within their respective industries.

Key trends and innovations to watch

Here are some key trends and innovations that will shape the landscape of cloud computing in 2024:

  • AI and ML in cloud services: Incorporating artificial intelligence and machine learning will enhance cloud services’ capabilities and pave the way for more intelligent and adaptive solutions.
  • Better AI/ML: Continuous advancements in AI and ML within the cloud will result in more sophisticated and effective applications across various industries.
  • Blockchain: Integrating blockchain technology into cloud services will enhance security, transparency, and trust in digital transactions.
  • Cloud sustainability: Environmental consciousness will play a significant role in encouraging the adoption of sustainable practices in cloud computing.
  • Edge computing integration: Redefining the proximity of data processing, edge computing is set to revolutionize the speed and efficiency of cloud services.
  • Hybrid and multi-cloud strategies: Organizations are embracing hybrid and multi-cloud approaches, offering flexibility, scalability, and strategic resource allocation.
  • Introduction of the Citizen Developer: The concept of the Citizen Developer aims to empower non-developers to create applications, bridging the gap between business needs and IT capabilities.
  • Serverless computing: The rise of serverless computing will redefine how applications are developed, allowing organizations to focus on functionality without managing server infrastructure.
  • The rise of FinOps: The financial and operational aspects of cloud management, known as FinOps, will grow as organizations seek optimal cost-efficiency.

CFOs and IT Directors embracing this paradigm shift are well-positioned to harness the dynamic and exciting potential of cloud computing in 2024. However, despite growth, adoption, innovation, and a positive outlook, cloud cost challenges remain.

Overcoming Imminent Cloud Computing Cost Challenges

In 2024, estimated costs in cloud computing are expected to rise significantly. Cloud computing infrastructure spending is predicted to surpass $1 trillion globally for the first time. 

For small to medium-sized businesses, future cloud migration and implementation will introduce unique financial challenges that demand strategic solutions:

  • Anticipating financial concerns: For small and medium-sized businesses (SMBs), it’s essential to carefully evaluate their computing requirements and explore options like public or hybrid cloud solutions.
  • Effective cost management: Managing future cloud costs will continue to be a big challenge, which will require careful planning, allocating resources, and optimizing strategies specifically for the cloud environment.
  • Unpredictable costs: Cloud-computing costs can arise unexpectedly, especially for SMBs with fluctuating workloads, so close monitoring, cost optimization, and leveraging technology expense management (TEM) solutions will be critical tactics.
  • Lack of IT expertise: SMBs may lack the necessary IT expertise to optimize future cloud costs, so partnerships with cloud service providers, TEM solution providers, and investments in IT staff training will help bridge this gap.
  • Data transfer and storage costs: Handling big data transfers and storage requirements will bring extra challenges, but these can be addressed using efficient transfer methods and effective storage management.

To be successful in cloud computing, organizations need to deal with these challenges proactively. They must leverage the expertise of financial and IT leaders and strategic TEM partners to optimize costs while ensuring the security and efficiency of their future cloud infrastructure.

Financial Transparency Ambiguous in Cloud Computing

In a recent survey, only 30% of organizations knew precisely where their cloud budget was going. So, it would make sense that optimizing the existing use of the cloud for cost savings should be a top priority for them. However, estimating upcoming costs while developing a proactive plan is a task that often surpasses an organization’s time and resource limitations.

In this scenario, SpyGlass can step in as a trusted ally as experts in technology expense management to provide a better handle on assets and services. It all starts with a SnapShot Audit to gain financial transparency around cloud costs.

Closing Thoughts About Cloud Computing in 2024

In the ever-evolving realm of cloud computing, the assertion by Milind Govekar, Vice President and Chief of Research at Gartner, rings resoundingly true:

“There is no business strategy without a cloud strategy.”

As we approach the pivotal year of 2024, the cloud transcends its conventional role, emerging as a strategic catalyst for innovation, agility, and overall success. The challenges ahead—from integrating cutting-edge technologies to mastering cost efficiency—emphasize the importance of navigating this transformative journey with foresight.

SpyGlass stands as a steadfast ally, offering a battle-tested technology expense management approach that provides foresight. The SnapShot Audit, fortified by decades of industry expertise, empowers CFOs and IT Directors to not only gain financial clarity but also leverage technology and communication service costs for building resilient, agile, and profitable businesses. So, as we enter 2024, we encourage you to embrace the future, comprehend emerging trends, and collaborate with strategic partners such as SpyGlass to unlock the boundless potential of cloud computing.

Ready to take control of your cloud computing expenses?

Start a SnapShot Audit to help prepare for 2024.

Contact SpyGlass to inquire about a no-costs-up-front SnapShot Audit.