The European IaaS market will grow at a double-digit rate for the next few years but service providers will need to make their portfolio of offerings more relevant to customers if they are to retain a competitive edge, according to new research from analyst firm Frost and Sullivan.
The analysts say that as organisations migrate from on-premise infrastructure to hosted alternatives, this in turn is driving growth in the European IaaS market.
This meant that cloud providers are pursuing regional strategies such as setting up of local data centres to fast-track uptake among European customers, according to research.
According to the firm’s new report, Analysis of the European Infrastructure-as-a-Service Market, the market has earned revenues of $1.95 bn in 2014 and estimates this to reach $10.11 bn in 2019.
“The on-demand, pay-as-you-go model of cloud services is garnering intense interest in Europe as it allows enterprises to effectively deal with volatility and seasonality in IT demand,” says Frost & Sullivan Information & Communication Technologies senior research analyst Shuba Ramkumar. “Infrastructure requirements can be easily altered using a web portal, in contrast to the traditionally cumbersome job involving physical servers or networks.”
In addition, enterprises find IaaS to be a suitable method to effectively manage IT spending in the face of challenging economic conditions in Europe, according to the research outfit. The deployment of IaaS decreases enterprise capital investment in internal data centres, hardware and human resources, which can instead be directed to core business functions, it adds.
To address concerns around security, cloud providers are developing hosted private cloud services compliant with specific standards, it says. “Enterprises, particularly in highly regulated industries such as healthcare and financial services, have reason to be concerned about security risks such as data loss, unauthorised access to apps and leakage of data,” the firm said in a statement.
“Offering hybrid cloud services that combine IaaS with managed hosting or on-premise cloud along with managed cloud services will help build a secure and unified infrastructure,” says Ramkumar. “With the rise in different hosting environments requiring enterprises to operate in multi-vendor ecosystems, service providers must also harness an environment of coopetition, where partnerships can be leveraged to ensure easy migration of applications and stronger adoption of IaaS in Europe.’
