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Industry Report

Industry reports, briefs issued by Samsung Economic Research Institute

How Cloud Computing is Revolutionizing the Future

How Cloud Computing is Revolutionizing the Future

CHOI Eunjeong

Apr. 8, 2013

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Tightened budgets amid the precarious global economic environment are prompting more and more companies around the world to turn to cloud computing services as an alternative to investing in IT hardware and software. Their interest is underpinned by employees who already are using cloud services to meet their personal and work needs. Ninety percent of all organizations worldwide were discussing adopting cloud in 2012, an increase from 75% a year before. Cloud utilization is especially visible in the US where companies, schools, government and medical institutions bolstered their usage in 2012.

The cloud computing market is expected to expand by 44% annually from now until 2016, when it is forecast to account for more than 60% of all traffic of global data centers. By 2016, global data center traffic is expected to reach 6.6 zettabytes, a nearly four-fold increase from 1.8 zettabytes in 2011, with cloud traffic representing 4.3 zettabytes, compared to 683 exabytes in 2011.

The explosive growth and potential of the cloud market has sparked a slew of mergers and acquisitions (M&A) among IT giants, aimed at securing cloud capability. In 2012, cloud accounted for more than 15% of all M&As in the IT sector. IBM, SAP and HP have entered the cloud market where Amazon and Microsoft dominated. This will likely trigger a mixed landscape going forward.

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