Pure Storage recently achieved a significant design win with one of the top four hyperscalers. According to a company press release, this industry-first milestone marks the expansion of Pure Storage’s DirectFlash technology into large-scale environments currently dominated by hard disks.

Pure Storage describes this as the ‘beginning of a transformative shift in the industry’. Historically, hyperscalers have relied on commodity disk storage, representing nearly 70% of global hard disk drive purchases—an estimated 700 exabytes per year.

“This is the first-ever design win to provide flash for standard hyperscaler storage and it is the vanguard for flash storage providing all online storage in major hyperscale environments in the future. For reference, the hyperscale market is responsible today for 60% to 70% of all Hard Disk Drives purchased globally,” Pure Storage CEO Charlie Giancarlo said while announcing the hyperscaler win on the company’s third quarter FY25 earnings call. 

Pure Storage has been contending that by 2028, practically no new all-HDD storage systems will be sold for data center computing. In fact, HDD shipments have seen a sharp decline over the past decade. From a peak of over 651 million units in 2010, shipments dropped by nearly 71%, reaching 166 million in 2022, according to Statista.

The India Story

Ramanujam Komanduri, Country Manager for Pure Storage India, emphasized how the hyperscaler win is driving the transition to flash storage.

“Hyperscalers are possibly the largest data consumers, and they have been using commodity disk storage simply because there hasn’t been an alternative that offers comparable economics—until now. Recent improvements in flash media density, its ability to scale higher and lower power consumption have been game-changers in recent years. Our design win signals that hypercalers can manage extremely large data footprints with high-capacity flash storage at economics similar to what they have been used to in the past.”

He emphasized that the design win will add to the momentum for the replacement of hard disk drives (HDDs) in the market.  

India accounts for a significant share of the market, generating nearly one-fifth of the world’s data. “Flash storage is a more sustainable way for hyperscalers to store the growing volumes of data. With Pure’s Direct-to-Flash technology, we can provide hyperscalers better performance, reliability, and significant power and space savings compared to hard disks, all at a comparable or lower total cost of ownership,” Ramanujam maintains. 

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Cloud repatriation or cloud exit are terms that we heard quite often in 2023 and will likely continue to command our attention in 2024. Is the cloud-first mantra, which was once widely touted as the future of all business operations, losing its luster? 

Thanks to several factors, CIOs are relooking at their public cloud strategies. While enterprises have greatly reaped the benefits of public cloud over the years, they are beginning to reassess their cloud-first or cloud-only strategies, opting instead to migrate certain workloads back to on-premise environments. Cost remains a key factor for this cloud repatriation.

A 2023 HashiCorp State of Cloud Strategy Survey reveals that almost all enterprises (94%) report “avoidable cloud spend” or what is known as ‘cloud waste’. 

“Cloud was at one point the biggest buzz, which took a long time to gain traction. Then it moved to a matured level of usage – a point after which many users realized that the costs were going immensely high. Strangely, accordingly to any law of technology, the cost should always come down as usage increases. Cloud has been the only exception to this rule,” says Sunil Mehta, CIO & Partner, BDO – a global professional services firm.

This, he adds, has led to ‘mixed feelings in the CIO community and the tech community at large’ about the future of public cloud as a platform of choice.  He was talking on the sidelines of Tech Saga 2024, one of the biggest gatherings of Tech visionaries, hosted by CIO Klub Pune chapter. 

“Strangely, accordingly to any law of technology, the cost should always come down as usage increases. Cloud has been the only exception to this rule,” says Sunil Mehta, CIO & Partner, BDO.

But is the public cloud aura really disappearing? Or is it the inherent evolutionary curve that  every technology will go through? 

Tech leaders emphasize that some key benefits of public cloud continue to be appealing and there are still quite a few takers for public cloud. Ashok Mandlik, SGM – IT, Deepak Fertilisers, vouches for the flexibility, scalability, agility, and the ease of innovation that comes with public cloud. 

“Most of the IT solutions today are available only on cloud platforms. Traditionally on-premise applications like ERP are also now moving to cloud. There is very little opportunity left to maintain these systems on-premise. That leaves organizations with no choice. Besides, an on-premise model is often not able to match the flexibility and agility that the cloud technology provides. The innovations that are rolled out by cloud players often compensate the downsides.”

Nevertheless, CIOs are increasingly going in for a workload-based approach as opposed to a platform-centric approach. They assert that certain workloads and applications are just not meant for the public cloud. 

“What we have typically seen is that CIOs want to put everything on the cloud without realizing what really needs to go there. That resulted in a lot of static data sitting on the cloud, which contributed significantly to the cloud cost upsurge. This trend was accelerated during COVID,” adds Mehta. 

“If the organization has clarity on the compute and storage parameters, the cost component can very well be controlled,” reiterates Mandlik. For many organizations, especially if they are not the very large enterprises, cloud is in fact ideal for balancing cost, performance, and security. 

“Traditionally on-premise applications like ERP are also now moving to cloud. There is very little opportunity left to maintain these systems on-premise. That leaves organizations with no choice,” says Ashok Mandlik, SGM – IT, Deepak Fertilisers.

According to Mandlik, security is still a strong reason for many firms to go in favour of public cloud. “For an on-premise model, enterprises will have to continue to invest on a wide-range of tools for risk mitigation and it’s an ever-evolving scenario. That is perhaps why security remains one of the strongest reasons for enterprises to go for public cloud. Add to that the need for backup & disaster recovery, and the availability of skilled manpower to manage the data Center, and many CIOs realize that cloud TCOs are in fact comparable with that of on-premise models,” he underscores. 

CIOs might often feel that they are walking on eggshells. They are falling back on the many learnings they have had over the years in finding the right fit. Hybrid and private clouds will see more adoption going forward as enterprises strive to control cost and maximize performance. Many ‘public-cloud only’ strategies are widely being shaken and revisited. 

“Hybrid cloud will certainly dominate. We will also see increased adoption of private cloud that provides the experience and security of a public cloud with better manageability and optimized cost,” believes Mehta. 

On-premise data centers still have very strong use cases in the manufacturing sector, Mandlik adds. Especially in process-heavy manufacturing establishments, the huge volumes of time-series data generated by OT systems still reside on-premise. But manufacturers leverage the cloud to analyze these data sets to derive business insights.

With more and more expensive AI workloads in the horizon, how are enterprises relooking at their cloud priorities? 

Enterprises’ cloud strategies are sure to get more nuanced – they are exploring a combination of public cloud, private cloud, industry cloud and co-location services, as they try to reassess each workload and place them in the right infrastructure. Cloud repatriation might be an obvious fallout of this reassessment. 

For the major hyperscalers who have long dominated the market, this is a decisive moment in their growth journey. Even though the pay-as-you-go model of the cloud is beneficial for fluctuating workloads, it can result in unexpected expenses when usage suddenly spikes. 

“There seems to be an increased interest towards Indian datacenter hosting companies and they could give the big hyperscalers a run for their money. Because cost is going to be a big differentiator in the cloud game,” states Mehta. 

Mandlik feels that the change is already happening. “Cloud providers now have become mindful of the fact that CIOs are increasingly conscious about cloud spending. Their dynamic pricing models (pay per use), simplified management mechanisms with flexible dashboards allow organizations to utilize the workloads and cloud services more meticulously,” he says. 

Above all, CIOs are relooking at their cloud strategies which they derived a few years ago. In today’s fast-paced world, one cannot expect a tech strategy to work for five years. Cloud is a perfect example of why our tech roadmaps should be versatile, according to Mehta.

“With cost becoming prohibitive, tech leaders must now go back to the drawing board and understand what needs to sit on cloud and what shouldn’t—and this must be done a lot more frequently now than before. Because the role of CIO is not about doing what everybody else is doing. We need to be a strategic leader than a blind follower,” he sums up. 

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The adoption of hybrid multicloud environments has become imperative as organizations in the APJ region reassess their cloud strategies, said Aaron White, GM and VP, APJ Sales, Nutanix. 

During its Q1 FY24, Nutanix observed three key trends across the Asia-Pacific and Japan (APJ) region that saw customers moving from public to hybrid multicloud and leveraging the potential of AI. 

Data security, according to Nutanix, is one of the biggest drivers of the accelerated adoption of hybrid multicloud. Hybrid multicloud allows organizations to maintain the necessary security measures for their sensitive assets while taking advantage of the public cloud’s agility and cost-efficiency, said Aaron in a recent APJ media roundtable. 

Nutanix has been quite vocal about cloud repatriation – a trend where companies move their workloads back from public clouds to on-premises or local cloud infrastructure. A 2023 Nutanix market study highlighted that over 46% organizations plan to repatriate some applications to on-premises datacenters to mitigate cloud costs in the year ahead. 

“Organizations realize they must learn from past experiences with public cloud and develop a strategic plan to avoid the need for cloud repatriation. To prevent cloud repatriation, it is essential to consider the benefits and suitability of hybrid multicloud instead of following the herd back to public cloud,” Aron remarked. 

He also spoke about how enterprises’ AI strategies are evolving with data security and governance taking precedence over cost in AI decision-making. Enterprise AI adoption will catalyze a wave of initiatives focused on data governance and mobility. Nutanix’s interactions with customers also reveal that many enterprises are struggling to identify the most efficient path to modernize their infrastructure to be able to support AI workloads. 

“AI technologies, and growing requirements for speed and scale, are likely to bring edge strategies and core infrastructure deployment to the forefront of IT modernization,” Aaron concluded. 

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AWS announced the AWS Generative AI Innovation Center, a new program to help customers successfully build and deploy generative artificial intelligence (AI) solutions. 

AWS is investing $100 million in the program, which will connect AWS AI and machine learning (ML) experts with customers around the globe to help them envision, design, and launch new generative AI products, services, and processes. 

The AWS Generative AI Innovation Center team of strategists, data scientists, engineers, and solutions architects will work with customers to build bespoke solutions that harness the power of generative AI. For example, healthcare and life sciences companies can pursue ways to accelerate drug research and discovery. Manufacturers can build solutions to reinvent industrial design and processes. And financial services companies can develop ways to provide customers with more personalized information and advice.

“The Generative AI Innovation Center is part of our goal to help every organization leverage AI by providing flexible and cost-effective generative AI services for the enterprise, alongside our team of generative AI experts to take advantage of all this new technology has to offer. Together with our global community of partners, we’re working with business leaders across every industry to help them maximize the impact of generative AI in their organizations, creating value for their customers, employees, and bottom line,” said Matt Garman, senior vice president of Sales, Marketing, and Global Services at AWS. 

Through no cost workshops, engagements, and training, AWS will help customers imagine and scope the use cases based on best practices and industry expertise. Customers will work closely with generative AI experts from AWS and the AWS Partner Network to select the right models, define paths to navigate technical or business challenges, develop proofs of concepts, and make plans for launching solutions at scale. 

Engagements will deliver strategy, tools, and assistance that will help customers use AWS generative AI services through APIs. Some of these services include Amazon CodeWhisperer and Amazon Bedrock, a fully managed service that makes foundational models (FMs) from AI21 Labs, Anthropic, and Stability AI, along with Amazon’s own family of FMs, Amazon Titan.

 They can also train and run their models using high-performance infrastructure, including AWS Inferentia-powered Amazon EC2 Inf1 Instances, AWS Trainium-powered Amazon EC2 Trn1 Instances, and Amazon EC2 P5 instances powered by NVIDIA H100 Tensor Core GPUs. Additionally, customers can build, train, and deploy their own models with Amazon SageMaker or use Amazon SageMaker Jumpstart to deploy some of today’s most popular FMs, including Cohere’s large language models, Technology Innovation Institute’s Falcon 40B, and Hugging Face’s BLOOM.

Companies like Highspot, Lonely Planet and Twilio are among the AWS customers who are in the process of leveraging the services offered by the innovation center. 

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Worldwide end-user spending on public cloud services is forecast to grow 21.7% to total $597.3 billion in 2023, up from $491 billion in 2022, according to the latest forecast from Gartner. Cloud computing is driving the next phase of digital business, as organizations pursue disruption through emerging technologies like generative artificial intelligence (AI), Web3 and the metaverse.

“Hyperscale cloud providers are driving the cloud agenda,” said Sid Nag, Vice President Analyst at Gartner. “Organizations today view cloud as a highly strategic platform for digital transformation, which is requiring cloud providers to offer more sophisticated capabilities as the competition for digital services heats up.”

“For example, generative AI is supported by large language models (LLMs), which require powerful and highly scalable computing capabilities to process data in real-time,” added Nag. “Cloud offers the perfect solution and platform. It is no coincidence that the key players in the generative AI race are cloud hyperscalers.”

All segments of the cloud market are expected see growth in 2023. Infrastructure-as-a-service (IaaS) is forecast to experience the highest end-user spending growth in 2023 at 30.9%, followed by platform-as-a-service (PaaS) at 24.1% (see Table 1).

Table 1. Worldwide Public Cloud Services End-User Spending Forecast (Millions of U.S. Dollars)

BPaaS = business process as a service; IaaS = infrastructure as a service; PaaS = platform as a service; SaaS = software as a service
Note: Totals may not add up due to rounding.
Source: Gartner (April 2023)

Gartner predicts that by 2026, 75% of organizations will adopt a digital transformation model predicated on cloud as the fundamental underlying platform. 

“The next phase of IaaS growth will be driven by customer experience, digital and business outcomes and the virtual-first world,” said Nag. “Emerging technologies that help businesses interact more closely and in real time with their customers, such as chatbots and digital twins, are reliant upon cloud infrastructure and platform services to meet growing demands for compute and storage power.”

While cloud infrastructure and platform services are driving the highest spending growth, SaaS remains the largest segment of the cloud market by end-user spending. SaaS spending is projected to grow 17.9% to total $197 billion in 2023.

“The technology substrate of cloud computing is firmly dominated by the hyperscalers, but leadership of the business application layer is more fragmented,” said Nag. “Providers are facing demands to redesign SaaS offerings for increased productivity, leveraging cloud-native capabilities, embedded AI and composability – particularly as budgets are increasingly driven and owned by business technologists. This change will ignite a wave of innovation and replacement in the cloud platform and application markets.”

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Nutanix, the hybrid multicloud company, released the findings of its fifth annual Enterprise Cloud Index (ECI) report which revealed that IT infrastructure is increasingly diverse, with organizations challenged with integrating data management and control. The research indicated that nearly half (48 percent) of organizations in India leverage more than one type of IT infrastructure, including a mix of private and public clouds, multiple public clouds, or an on-premises datacenter, along with a hosted data center. This number is expected to grow by 87 percent in next three years, outpacing the global ECI average by 13 percent. 

The greatest growth area in India is in hybrid multicloud infrastructure (private infrastructure coupled with more than one public cloud). Hybrid multicloud usage in India at present is 12 percent and is expected to increase by five-fold (63 percent) in the next 3 years. Increased infrastructure diversity, along with a heightened emphasis on data storage, management, security, and services, is driving all IT pros to seek hybrid operations that transcend private and public infrastructure.

“The findings of the Nutanix Enterprise Cloud Index report once again showcase the rapidly evolving nature of the IT infrastructure landscape in India. As organizations adopt a hybrid multicloud approach, managing data across diverse IT environments is becoming increasingly complex. It is imperative for enterprises to streamline their data and applications across public cloud, private cloud, and on-premises infrastructure, and leverage a single, unified control plane for seamless management. Nutanix recognizes this need, and our commitment to providing cutting-edge hybrid multicloud solutions that enable organizations to build, operate, and govern their IT infrastructure with ease remains unwavering,” said Faiz Shakir, Managing Director – Sales, Nutanix India & SAARC.

In the past five years of conducting the ECI, respondents’ attitudes, globally, have drastically shifted toward the use of multiple IT environments. In 2018, well over half of respondents worldwide said they envisioned running all workloads exclusively in either a private cloud or the public cloud one day. Rather than working to consolidate on a particular infrastructure or IT operating model, as seemed desirable in 2018, most enterprises now see the inevitability, and even benefits, of running workloads across public cloud, on-premises and at the edge.

The goal for organizations now is to make this hybrid operating model more efficient, especially when managing IT environments across the edge to the core. The growing level of diversity in cloud deployments creates enormous complexity in managing application’s data across cloud environments. Comprehensive tools that enable organizations to provision, move, manage, monitor, and secure applications and data from a single console in a uniform manner is a growing priority for IT. Nearly all respondents worldwide (95 percent) say they’d benefit from having a single, unified control plane to manage applications and data across diverse environments.  

Key findings from this year’s India report include –

Cloud cost control ranks as a top IT management challenge in mixed environments – 57 percent of the respondents consider cloud cost as a challenging IT management issue while 34 percent expressed a “very concerned” attitude about cloud costs in the context of their IT budgets for the upcoming year. In comparison, only 30 percent of APJ and global respondents identified cost as a top IT management challenge. The other top-ranking challenges include security at 55 percent and data analytics/orchestration at 54 percent. Furthermore, while 99 percent of the Indian respondents acknowledge the importance of having full visibility into where all their data resides, only 31 percent report having that visibility, indicating significant room for improvement.

All enterprises in India (100 percent of respondents) have moved their applications across environments in 2022, marking a 6 percent increase from the previous year. Among these enterprises, 64 percent did so to enhance control over their applications, 58 percent to meet sustainability objectives, and 57 percent to strengthen their security posture or comply with regulatory requirements. Additionally, approximately 57 percent cited the need for integration with cloud-native services such as AI/ML as a factor in their decision to move applications.

Cybersecurity is the biggest IT infrastructure decision factor in India – In India, 17 percent of enterprises consider cybersecurity as the top priority when making IT infrastructure investments. This is followed by the flexibility to run workloads across different cloud infrastructures (14 percent) and performance (12 percent). Notably, twice the percentage of respondents from India emphasized performance compared to the full APJ regional response base (6 percent). On the other hand, application requirements were mentioned the least in India (3 percent), while cost was not a significant decision factor in other regions,while elsewhere, cost was the least important decision factor.

For the fifth consecutive year, Vanson Bourne conducted research on behalf of Nutanix, surveying 1,450 IT decision-makers around the world in December 2022 and January 2023. The respondent base spanned multiple industries, business sizes, and the following geographies: the Americas; Europe, the Middle East, and Africa (EMEA); and the Asia Pacific Japan (APJ) region.

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