SAO PAULO, BRAZIL, August 27th, 2014 – Capgemini, one of the world’s foremost providers of consulting, technology and outsourcing services, has announced the findings of its study Business Cloud in Brazil: Research Report 2014: At the tipping point of accelerated adoption. This is Capgemini Group’s first research study on the Brazilian Cloud market, covering the rhythm of adoption of emerging models of enterprise infrastructure and the application landscape in the age of Cloud, solely on Brazil.
To conduct this study Capgemini hired Coleman Parkes Research, an independent market research firm. The analysis was based on interviews with 415 IT executives (CIOs, directors, leaders, application and infrastructure managers) from medium-sized and large private companies and public sector organizations in Brazil, between March and April 2014. It covered the Public, Consumer Products, Retail, Financial Services, Manufacturing, Energy and Telecommunication sectors.
The study revealed the current status of Cloud adoption in the country, showing no prevalent model. Smaller companies tend to use the public Cloud, while large and medium-sized companies prefer the hybrid model. Just over 26% of respondents express no preferences at all. Thereafter, the results are spread across the continuum from public – the most attractive model at 24% – through private on-premise (18%), hybrid (18% public and private) and private third party managed (14%).
However, in two years and five years’ time, the picture shifts. There is a definite and gradual move away from public Cloud in favour of a variety of private and hybrid cloud models. By 2019, if private off- and on-premise and hybrid are combined, private Cloud is clearly the preferred option at 76%, leaving ‘pure’ public Cloud attracting only 17% (declining from 24% to 20% and then 17%) as their preferred model. The rest of people have yet to decide on their preferred approach.
“We expect that, in the short term, a majority of companies will use hybrid since so many applications and workloads can be processed in public Cloud”, said Gustavo Trevisan, Integrated Solutions director from Capgemini Brazil, one of the research coordinators.
Other areas assessed were Software-as-a-Service applications, currently used by 73% of the companies that have adopted the Cloud, and the evolution of the Enterprise App Store – over 70% of the executives already have, or plan to have an EAS in place. In addition, the Infrastructure-as-a-Service (IaaS) model is expected to grow and mature (from 55% currently to 88% using the approach in two years), while Platform-as-a-Service (PaaS) is the model of choice now for 39% of the respondents, with a further 34% planning to use it.
Despite alternatives, the Brazilian data center continues to consume a high proportion of IT Capex, with 48% of the executives currently spending between 20-60% on data centers. The model however is shifting towards third party management to deal with increasing data volumes and the growing need to protect data.
“We know that much of our clients’ Cloud strategy is determined by the need for tight data security and control, to counter the real international challenges in the globalized macro-economic environment, and the need to see a positive return on their existing embedded investment in Cloud”, explains Trevisan.
A previous view
In 2012, Capgemini announced the study Business Cloud: The State of Play Shifts Rapidly: Fresh Insights into Cloud Adoption Trends. The study, carried out between June and July 2012, was based on interviews with 460 IT leaders and directors of large companies from around the world, with 11% of the respondents working for companies established in Brazil. The respondents represented a number of sectors, including Telecom & Media, Manufacturing & Automotive, Energy, Public Sector, Financial Services and Retail.
According to the report, 78% of Brazilian organizations had already developed a cloud strategy. However, around 64% said adoption of the Cloud was not a priority. Around 87% of Brazilian companies agreed that the economic scenario might force them to shift to the Cloud in the future.
Again in 2012, there was a clear preference for the private Cloud in Brazil. When asked about their preference, 46% of Brazilian organizations mentioned external private Clouds hosted by a third party and 26% cited on-premise private Cloud. Only 8% of the companies were inclined to adopt the public Cloud – lower than the number of respondents from other countries (19%).
At that time, the key obstacles to Cloud adoption included: “concerns related to security breaches” (cited by 52% of the companies) “finding the right partner” (38%) and “lack of integration” (36%). The peace of mind brought by reduction in the uncertainty of local executives about whether or not to adopt the Cloud, as stated previously, might derive from the focus on SLA development and management by systems integrators (62%), rather than cloud providers (38%). However, 42% of Brazilian respondents said they were willing to use cloud-based data storage; 58% considered its use for streamlining applications, and 92% intended to move new applications, rather than existing ones, to the Cloud.