IT budget growth is being revised downward by CIOs, but at the same time cloud computing has increased as a driver of IT spending, according to a CIO Survey released this week by Nomura. CIOs expect IT spending to increase 1.2 percent in 2016, after predicting a 3.1 percent increase in the fall.
Nomura surveyed 50 CIOs in the US in March, mostly at small and medium-sized business, about their expected IT spending, following a similar survey in October. It found that while security remains the top driver of IT spending, 62 percent said cloud computing is driving IT spending, up 10 percent from October, surpassing big data analytics (60 percent) for second most common driver.
Data sprawl was named a spending driver by 18 percent of those surveyed, an increase of 12 percent, making it the one factor increasing IT spending more than cloud computing. That pair of increases also suggests that the scalability of cloud resources is a growing motivation for CIOs to migrate workloads to the cloud.
Survey respondents predict that cloud consumption will rise from 31 percent in 2014 to 58 percent in 2018. Public cloud use is expected to grow the fastest, from 8 percent to nearly 20 percent, while private cloud will grow from 17 percent to 25 percent of all IT consumption. With hybrid also increasing, only 42 percent of workloads are expected to run on internal infrastructure in 2018, down from 67 percent in 2014.
SaaS deployments are also expected to rise, from 33 percent of applications to 56 percent in 2021, and Workday is expected to be the short term winner, receiving more revenue from 56 percent of respondents in 2016 than in 2015, just ahead of Salesforce (52 percent). Other IT software vendors expected to take a significantly bigger share of IT budgets include Proofpoint, Palo Alto Networks, VMware, Microsoft FireEye, NetSuite, and F5.
A report released last year by NTT Communications predicted cloud computing will take up 28 percent of corporate IT budgets in 2018.