84% of subscribers eye full cloud migration in two years – Alibaba Cloud survey

Most of the businesses that are currently subscribed to cloud services are set to make a full cloud migration in the next two years.

This is according to a survey that was commissioned by Alibaba Cloud, the digital technology and intelligence backbone of Alibaba Group.

A survey report called “The Next-Generation Cloud Strategy in Asia” show that 84 percent of the existing cloud service users are planning to increase their investments in the technology this year as more companies start to move their critical businesses online to efficiently handle their workloads in the post pandemic world.

This increase will most likely come from Thailand (95 percent), Indonesia (94 percent), the Philippines (91 percent), Hong Kong Special Administrative Region (83 percent) and Singapore (83 percent), the report states.

According to the survey, 94 percent of the organizations in Malaysia also have plans to evolve its cloud strategy in the future.

On the other hand, a large percentage of the businesses that were surveyed in Japan and South Korea said that they would rather maintain their current levels of investment.

“Cloud adoption has become a prerequisite for businesses to succeed and our customers are adopting a diverse cloud strategy to drive business growth in the digital era,” said Selina Yuan, Vice President of Alibaba Group and President of International Business for Alibaba Cloud Intelligence.

Yuan said that with cloud infrastructure being the ultimate foundation for many cutting-edge innovations such as generative AI, they are as committed as ever to provide proven cloud-based solutions for businesses in different industries and support their seamless migration to the cloud services.

The gaming sector, for one, is expected to see the sharpest increase in cloud investment, followed by media and telecommunications, internet and technology and financial services.

In the area of investment priorities, a big share of businesses in Asia wanted to focus on data analytics and artificial intelligence (AI) (53 percent), cloud computing (52 percent), and automation (46 percent).

The survey added that with more businesses planning to increase their investments in cloud computing, this underscores the importance of cloud infrastructure in supporting their growth.

But while more than two-thirds or 69 percent of the respondents have used cloud for at least three years, the survey showed that those that are in Hong Kong S.A.R, Japan and Singapore are the earliest adopters with only one in five or 20 percent having less than three years of experience in using cloud services.

Industry-wise, internet and technology, manufacturing and financial services show the highest level of cloud maturity.

According to the research, 84 percent of the surveyed businesses expect to fully migrate to the cloud within the next two years, partly driven by the new needs that emerged during the pandemic.

More than a third or 36 percent of the respondents anticipate a complete cloud migration within the next six months.

According to the surveyed businesses, the impact of COVID-19 has led to significant changes in their use of information technology (IT). About 54 percent of these reported an increased use of cloud-based software while 41 percent reported an acceleration in their cloud migration.

Survey data also showed that Malaysia’s uptake of the use of cloud software has clocked in a 56 percent increase as a result of the pandemic.

When the survey was conducted, private cloud (40 percent) was the most popular strategy in Asia, followed by public cloud (27 percent).

Its strong reputation for security, reliable local support and attractive pricing are the reasons mentioned as to why businesses choose public cloud. About 38 percent of the surveyed businesses are expected to boost investment by more than one fifth in the coming year.

In the survey of Asian markets, South Korea showed the highest public cloud adoption rate at 43 percent.

The top sectors that are currently using public cloud are gaming, public sector, retail, and internet and technology.

Moreover, hybrid cloud adoption is on the rise, with the survey recording a 7 percentage-point net increase in current adoption rate compared to the respondents’ initial cloud strategy adoption.

The respondents who have changed their cloud strategy, the highest proportion of 39 percent have switched to hybrid cloud.

In addition to security, businesses choose hybrid cloud for customised cloud services.

Alibaba Cloud commissioned global market research firm NielsenIQ to conduct the survey in order to better understand the state of adoption of the prevailing cloud strategies – private, public and hybrid – across Asia.

The survey was conducted between the end of September 2022 and early October 2022 by collecting feedback through online questionnaires from 1,000 cloud strategy decision-makers in small to large-sized businesses that are currently using cloud services in eight markets in Asia.

The respondents represented a wide range of industries like financial services, gaming, internet and technology, manufacturing, media and telecommunications, public sector and retail.