Cloud Services Market Drives Cloud Automation Growth

Some tech magazines might have you believe that most companies are now computing, networking, and storing data in the cloud. But accepting the new cloud computing technology is still at its early stage. Companies are still vying for a piece of the fast growing market.

This explosion of cloud services is sending waves through neighboring industries. As a result, sales of physical servers are beginning to slow down. Cloud automation tools, however, are beginning to soar. The new trend is moving towards different cloud environments, cloud automation is even more important if the companies are to realize the quickness and efficiency benefits of moving to the cloud.

cloud automation

Cloud Services Are Blooming

The public cloud service area of the cloud is starting to grow rapidly – more than 26% per year – according to research house IDC. That firm stated last September that it expected worldwide spending on public cloud services, like Amazon Web Services (AWS), to grow to almost $100 billion by 2016.

This fast-developing opportunity has not gone unnoticed. While AWS is by far the best known public cloud services out there, other public cloud service companies have started staking their claim to a piece of the cloud, and newcomers announce themselves on a regular basis. Established technology companies like Microsoft, Dell, IBM and HP have already jumped in over the past few years. Google started offering its own public cloud computing services a year ago.

There is a very good reason for companies like Dell, IBM and HP to chase the public cloud: Since server sales are declining, and not slowly either. IDC reported last month that revenue at most server factories worldwide was 7.7% lower in the first quarter of this year than in last year’s Q1. This year’s first quarter was the fifth year of a yearly decline out of the previous six, says IDC. What makes it worse is that companies are not just ordering fewer servers but they are also negotiating lower prices.

One exception to the declining-server story is Linux servers. Linux Servers are growing more popular, mainly because they are favored for building cloud infrastructure and high-performance computing environments. As a result, sales of Linux servers are cutting into the already lower sales and profits of other servers.

The private cloud infrastructure market is growing to as companies begin to build their own cloud environments to step up their efficiency, all while guarding security and trying to retain full control of their infrastructure.

The private cloud computing market was estimated to be worth $12.3 billion worldwide last year, and it is expected to grow to more than $22 billion by 2017. Even the companies that build their own cloud environments are buying less hardware and are relying more on software to upgrade their computing capacity.

Cloud Services Deliver Efficiency

More companies turning to cloud computing for more than just the cost effectiveness. Leading-edge companies will turn to cloud services for the greater flexibility they enable in crafting new business models.

Netflix, for example, runs its whole video streaming operation on Amazon’s servers. By outsourcing the data center functions to Amazon allows Netflix not only to differ its server usage as the demand fluctuates, it also allows the company to concentrate its technical innovations on fine-tuning their delivery and recommendation algorithms, and to also develop new features.

Cloud Automation is Key to Business Benefits

Cloud services cannot deliver on its promise without the enabling effects of automation. Cloud automation saves sysadmins time and also allows them to be more productive, but they do more strategic work too.

There are other cloud services benefits, too, that urge business managers to budget for cloud automation tools.

Servers can be provisioned much more quickly, speeding up product development and delivery to internal and external customers. Also, online services can be delivered more dependably and with fewer outages and faster restoration of service. A company will be able to comply with the standards, policies and industry regulations by reducing the chance for human error.

With such a strong case for cloud automation tools, sales of cloud management software, including both cloud automation and analytics is expected to grow from $1.2 billion worldwide last year to more than $4.4 billion in 2017. This number represents the sharply accelerated growth over the last few years.

However accurate or inaccurate these projections are, one thing is for sure: Cloud computing usage will only continue to grow and so will the need for cloud automation software.

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