Partners: Demand For Cloud Services Is ‘Up Significantly’ For 2021

Solution providers that partner with AWS, Microsoft Azure and Google Cloud tell CRN that they are expecting major growth in their cloud services businesses this year -- as agility and rapid scalability become a greater necessity for many customers.

Accelerating demand for cloud services is expected to generate significant growth in the category for 2021 overall, as more customers turn to the cloud to help guard against uncertainties in their businesses, solution provider executives told CRN.

A growing number of customers have decided that the timing is right for transitioning to the cloud--as some of the cloud’s long-touted benefits, such as agility and scalability, become a greater business necessity than in the past, the executives said.

[Related: Cloud Surge: 4 Takeaways On The Growth Of AWS, Azure And Other Platforms]

Executives at five top solution providers--which partner with cloud providers including Amazon Web Services, Microsoft Azure and Google Cloud--spoke with CRN about their optimistic outlook for cloud growth in 2021.

For many customers, “they’ve decided that it’s time,” said Eran Gil, CEO of San Francisco-based AllCloud, an AWS Premier Consulting Partner. “It’s not time to just ‘maybe’ move to the cloud—but it’s time to [actually] move to the cloud.”

In January, for instance, AllCloud saw “significant demand--both from net new opportunities with customers looking to migrate and transition to the cloud [and from] customers that are already working with us, that want to do more,” said Gil, who is now expecting revenue growth of 40 to 50 percent for this year compared to 2020.

“We came out into January with truly modest expectations for the year,” he said. “However, that has completely changed.”

At Perficient, a Microsoft Gold Partner and No. 55 on CRN’s Solution Provider 500 for 2020, “our Azure business is growing like crazy,” said Steve Holstad, Azure practice director at Perficient.

The St. Louis-based solution provider is finding fast-rising demand for deploying Azure as a “fully governed, automated and ready to scale” solution for customers, Holstad said.

“We’re at that point where so many groups are out there ready to invest and make major strides in that area,” Holstad said. “And then along the way that’s quickly pivoting into large-scale, multi-year investments in app modernization, app innovation and cloud migration.”

At solution provider Anexinet, “demand is up significantly across the board” both for cloud and “cloud-like” solutions, said Tim Malfara, vice president of hybrid IT and cloud services at the Blue Bell, Pa.-based company. “We’re having discussions with a vast majority of our clients about that.”

The “cloud-like” solutions allow customers to achieve many of the benefits of cloud, such as pay-as-you-go consumption models, with their own on-premises infrastructure, Malfara said.

Notably, Anexinet--an AWS Advanced Consulting Partner and Microsoft Gold Partner, and No. 212 on the Solution Provider 500--is finding that the potential for cost savings is not the main factor driving many of the decisions to move to the cloud, Malfara said. The cloud “may or may not be cheaper” than on-premises infrastructure, he said.

Instead, solution providers have found that the agility of being able to rapidly increase or decrease cloud resources is among the biggest drivers behind the surging cloud demand--as many businesses are unsure what their future needs could be in a fast-changing economic environment.

“The ability to pool resources and be more efficient and have rapid elasticity up and down--that’s functionality that lets the cloud really solve the business need or business problem,” Malfara said.

In the current environment, “there is an attractiveness about the scalability and agility of cloud that has been really brought to the surface,” said Gabriel Romero, chief marketing officer at AllCloud.

Even for customers that only had a few workloads in the cloud, “all of a sudden they saw the scalability and agility that the cloud offers--and now they’ll want to move more workloads to the cloud,” Romero said. “Or in the case of a remote workforce, they saw how quickly they could move people over [by leveraging cloud resources]. Or unfortunately if somebody has to let people go, the usage of cloud is more scalable than if you are on-premise.”

Meanwhile, as cloud budget overruns persist as a major issue in the industry, solution providers are also assisting customers with cloud cost management tools and services.

“Clients know they need to be on cloud, they just don’t know how much it’ll cost to get there and how much it’ll cost once there,” said Reed Wiedower, global alliances leader and CTO for the Cognizant Microsoft Business Group.

Educating customers on what workloads benefit from moving to a cloud service is still a large part of the conversation, said Rajesh Abhyankar, CEO and co-founder of MediaAgility, a Princeton, N.J.-based Google Cloud managed service provider that works with verticals including media and life sciences.

Part of the education process involves helping to answer questions around cloud adoption costs. Overall, the effective use of cloud solutions is an ongoing part of MediaAgility’s conversations with customers, Abhyankar said.

“The rate at which public clouds are innovating are far, far outpacing even the smartest customer,” he said.

Some partners are using packages of solutions to help entice businesses into cloud adoption or to show existing customers new ways that cloud computing can improve a particular business function. AllCloud, for example, offers a “Solutions Factory,” a collection of architecture blueprints to help expedite AWS adoption.

Ultimately, when it comes to the cloud, “the penetration is still very small in percentages,” Gil said. “The opportunity is there. We’re all just scratching the surface.”