IaaS market set to grow and change rapidly

SaaS cloud computing models have established themselves as a reliable way to deliver applications and services in the cloud. According to a recent Gartner Research report, IaaS could be the next cloud model to establish itself as a major player in the industry, but it will experience a period of rapid growth and tumultuous change to get there.

Gartner estimates the current IaaS market stands at $3.7 billion and expects the upcoming period of expansion to raise its value to $10.5 billion by 2014.

Lydia Leong, research vice president at Gartner, said IaaS cloud computing models are still in an early stage for adoption. As a result, the evolving market is positioned to have a dramatic impact on the technology industry, putting IT infrastructure through a metamorphasis during the next 10 to 20 years. Within the next five years, Leong expects the industry to take advantage of that potential to create substantial new revenue opportunities in the sector.

Gartner explained IaaS cloud computing is capable of providing the architectural backbone for businesses and consumers, allowing them access to operating systems, applications and other software without having to manage or own the hardware. Leong warned that the market's current immaturity has led to an environment that fosters partial solutions. Enterprise customers are tending to deploy basic IaaS plans that may meet a single need, but are not strategically developed. Leong said service providers should focus on pushing strategic solutions so they can retain customers over an extended period.

"Startup IaaS pure-plays, web hosters, carriers and data center outsourcers are all competing in the cloud computing IaaS market. However, many providers have a market viewpoint that is restricted by the particular use cases that they see in their sales pipeline, and this can lead to tunnel vision," said Leong. "In reality, customer requirements and use cases for cloud compute IaaS are diverse and evolving quickly. Cloud IaaS represents a spectrum of services; there is no 'one size fits all,' and no single service provider successfully addresses all segments of the market."

Success in the growing IaaS market, according to Leong, is about understanding what business customers truly want out of the technology. Service providers need to be able to evaluate the short-term and long-term strategies their customers are developing to deploy the IaaS cloud and learn to adapt their service offerings and technological provisions to support those goals and keep up with the changing market, she said.

The rapidly changing market conditions will also force service providers to pay close attention to each specific type of buyer. According to Leong, IT professionals, executives, business strategists, end-users and other types of IaaS customers will all have different goals when it comes to deploying the technology. These disparate ideals will dictate the market's momentum during its maturation. As a result, Leong explains it is critical that service providers look to understand these constituents and respond appropriately.

When considering a move into cloud computing, businesses need to strategically deploy the technology to ensure it meets their needs without sacrificing their ability to remain active and productive. In a recent Network World report, Mark White, CTO for Deloitte Consulting, said businesses need to carefully consider how they move to the cloud. In terms of IaaS clouds, White said transitioning to the cloud is about the business side of running an IT department. Therefore, businesses need to focus on making sure the solution can support IT operations while helping alleviate financial concerns.