When analyzing the growth of cloud vs. data center vs. hybrid environments, several factors come into play. A company’s size, resources and the number of applications they use have shown to be determining factors in each model’s adoption and subsequent expansion.
Companies have different needs when it comes to hosting software and applications. Large companies typically have the money, staff and resources to set up a data center or hybrid environment. Startups prefer the cloud for its affordability and ease of use.
So how does application growth compare between cloud, data center and hybrid models?
First, let’s get a clear understanding of each hosting environment.
Cloud Vs. Data Center Vs. Hybrid
The difference between the cloud vs. data center environments is that the cloud refers to off-site storage and computing, whereas a data center refers to on-site storage. The cloud is a virtual storehouse for your data, while a data center physically stores your data on your own equipment. A hybrid cloud environment is a mix of both cloud and in-house storage.
Cloud providers offer remote/virtual computing resources delivered on demand and hosted on top of a cloud computing infrastructure. According to Gartner, 75% of companies using cloud services indicate they have a cloud-first strategy.
Benefits: Efficiency, flexibility and reduced IT costs
There are different types of cloud environments:
- Private Cloud: Cloud computing services that are provisioned over private IT infrastructure for the dedicated use of a single organization
- Public Cloud: An infrastructure or platform product offered as an on-demand service by third-party webscale providers
- Multi-Cloud: The use of two or more cloud services within a single business architecture
- Hybrid Cloud: A mix of on-premises, private cloud, and public cloud services with orchestration between the platforms.
Data centers house computer systems and storage within a company. Data center providers sell physical infrastructure to store computer servers and networking systems for business. To keep pace with growing software demands, more companies are abandoning physical servers in favor of cloud hosting.
Benefits: Greater security and control
As mentioned above, hybrid cloud refers to a mix of on-premises, private cloud, and public cloud services. Hybrid cloud usage is still growing, but the rate of net new adopters is declining. Companies need a data center presence, engineering team and ample resources to even consider setting up a hybrid cloud environment. Therefore, adoption of the hybrid model is generally limited to larger, more established companies.
Benefits: High flexibility, customization and security
Cloud Vs. Data Vs. Hybrid: Comparing Application Growth Year Over Year
Cloud, data center, and hybrid configurations have experienced significant growth rates since 2013.
Cloud technology was considered a disruptor when it was first introduced, but it has since gained widespread recognition and adoption. Cloud usage has increased significantly, while growth of the hybrid and data center models remain moderate.
Data Center: 24% YoY Growth
Startups deploy less than one percent of data center applications. Small and medium businesses (SMBs) make up nearly 60% of data center application deployments today, followed by enterprises at 22% and mid-market companies at 17%.
Cloud: 41% YoY Growth
As cloud applications become cheaper, more accessible, and easier to set up, cloud application growth has skyrocketed among startups and SMBs. Startups deploy 56% of all cloud applications worldwide.
Hybrid Cloud: 24% YoY Growth
Hybrid application configurations are most popular among enterprises and mid-market companies. Startups are unlikely to have the budget, resources, and engineering team needed to deploy hybrid applications.
Want to see more graphs on cloud vs. data center vs. hybrid growth? Download the 2019 Data Center Market Report today.
Application Growth Trends
The total number of cloud applications in use surpassed 19 million at the end of 2018.
The average number of applications that a business uses is rapidly accelerating. More vendors are providing tools and infrastructure to simplify application development and bring products to market faster.
Data from our 2019 Cloud Market Share Report indicates that the rapidly increasing use of software and app development is driving up cloud hosting spend and usage. The average number of applications that a business uses is accelerating as more vendors provide tools and
infrastructure to simplify application development and build web-scale products.
Cloud computing is a critical tool for modernizing applications and making software accessible to companies of all sizes. Choosing whether to use the cloud, an internal data center, or a mix of both is dependent on a company’s needs and resources.
Intricately specializes in helping cloud providers like yourself solve complex challenges by:
- Examining Trends & Shifts in Data Center Hosting: We’re constantly tracking and analyzing how customers are using their data centers.
- Analyzing Markets: Understand new market opportunities across industries and geographic locations by analyzing usage and spend data.
- Finding Buyers With Data Center Needs: Identify and prioritize revenue opportunities.
Contact us today for a free demo.
What trends are powering the most significant growth of global cloud application hosting? Our 2019 Data Center Market Report provides analysis and unique insights on data center trends in light of the ever-expanding transition to cloud technology.
Download the 2019 Data Center Market Report Now
Want to learn the latest trends in the CDN and cloud markets? Download our previous market reports here:
- What CDN providers are growing – or shrinking? Find out in our 2019 CDN Market Report.
- Where do opportunities exist in the cloud market, and how are the top players faring? Get updated with our 2019 Cloud Market Share Report.