Multicloud Strategies Complemented by Kubernetes Containers and Serverless Computing

Cloud computing has become a fundamental platform driving digital transformation and modernizing IT systems. Companies are looking to boost business agility or reduce costs by renting software from providers such as Amazon Web Services (AWS), Microsoft, and Google.

According to Forrester Research, most enterprises are already purchasing cloud services from more than one vendor, and this trend will accelerate in 2019. As a result, AWS, Microsoft, Alibaba, Google, IBM, and Oracle are expected to gain a larger share of the global public cloud spending, which is projected to reach USD 200 billion in 2019.

Despite strict requirements under the European Union’s General Data Protection Regulation (GDPR), cloud adoption continues to grow as cloud providers expand their service portfolios and global reach.

Dave Bartoletti, an analyst at Forrester Research, noted that more changes are on the horizon. Rather than simply offering low-cost servers and storage, cloud vendors are increasingly delivering advanced development services for enterprise-grade applications.

For example, companies are no longer seeking a “perfect” cloud strategy. Instead, they want to understand how competitors are using the public cloud: Are they building marketing analytics systems? Are they developing IoT applications? How are they doing it, and with whom? Bartoletti added that many enterprise discussions now revolve around migrating data generated from core SAP and Oracle applications to public cloud platforms.

These innovation-driven approaches will increase enterprise spending as organizations modernize their core business applications with analytics, machine learning (ML), IoT, messaging, and cloud-native database services. “In 2019,” Bartoletti said, “the cloud will be the best way to turn ideas into amazing software faster.”

Below are the key cloud adoption trends for 2019:

Multicloud Strategies Gain Momentum

When it comes to public cloud, State Farm is playing a long game. While most organizations already use subscription-based cloud software, the insurance company will migrate its first two core applications to the public cloud in the coming months.

Like many companies, State Farm is sourcing public cloud services from multiple vendors. Ashley Pettit, Senior Vice President of IT at State Farm, revealed that the company is moving its Drive Safe & Save mobile app to AWS this year and plans to migrate pricing and underwriting systems early next year. Although AWS is State Farm’s primary cloud provider, the company also works with Microsoft Azure and Google Cloud Platform to maintain flexibility.

Using multiple cloud platforms has become commonplace. For instance, Honeywell relies on IBM and Microsoft Azure, while General Electric uses AWS and Azure. Pettit said this shift is part of a broader transformation to increase agility in cloud-native software development and enhance long-term flexibility.

Innovation Accelerates in the Cloud

Containers such as Kubernetes and serverless computing are reshaping enterprise application deployment. Over the past few years, adoption of Docker containers has surged as developers modernize their applications. Bartoletti noted that Kubernetes—software that automates container deployment, scaling, and management—has emerged as the preferred orchestration tool for enterprises. In 2019, Kubernetes will become easier to scale and secure, with vendors introducing new features for API-driven security policy orchestration.

Serverless computing will also continue to grow as companies seek to expand their digital services and applications. With serverless models, customers can develop, run, and manage applications without having to build or maintain the underlying infrastructure. Functions can be triggered through APIs in response to events, such as IoT sensor activity. AWS, Microsoft, Google, and other cloud providers are expected to expand their serverless offerings—commonly known as function-as-a-service (FaaS).

Bartoletti emphasized that serverless computing, containers, and Kubernetes will form the foundation for future modernization of core business applications. Ultimately, “the entire cloud will become serverless.”

Gartner predicts that more than 20% of global enterprises will adopt serverless technology by 2020, up from only 5% today.

A New Era for Private Cloud

Bartoletti outlined three key paths that will keep private cloud relevant in 2019. He views private cloud as a platform for hosting workloads not well suited for the public cloud due to cost, security, compliance, data, architectural, or other constraints.

The first approach is do-it-yourself (DIY) private cloud, commonly built using VMware vSphere and software-defined infrastructure—a method used by financial institutions like Synchrony. However, Bartoletti believes DIY private clouds often become expensive, complex, and incomplete. Another DIY option is using the open-source OpenStack platform.

The third approach is vendor-delivered private cloud built specifically for an organization, using integrated or hyperconverged systems to reduce technical overhead.

Evolving PaaS Strategies

In 2019, large enterprises will refine their platform-as-a-service (PaaS) strategies to deliver a consistent and improved user experience across all phases of application development, Bartoletti said. Enterprises have already benefited from improved early-stage development and deployment, but will now need to enhance the control and management of their platforms and applications over time.

Organizations must also decide whether to leverage unique, proprietary PaaS capabilities from specific cloud providers or prioritize cloud neutrality. Some may choose to abstract away vendor-specific features while waiting for vendor-agnostic tools—such as Kubernetes and TensorFlow—to mature and become easier to use across environments. Bartoletti advised CIOs to choose a direction but continuously re-evaluate their strategy.

SaaS Ecosystems Will Expand

Bartoletti noted that in 2018, SaaS vendors increased integration through acquisitions—for example, Salesforce acquiring MuleSoft, an API management provider, and Workday’s moves to unlock its platform. In 2019, industry-specific SaaS ecosystems will gain momentum, driven by enterprise vendors such as Microsoft, Oracle, and SAP.

The earliest examples will emerge in supply-chain-dependent industries where data sharing and collaboration are critical, such as manufacturing, healthcare, and government.