Hong Kong Looks to Reduce Dependency on Traditional IT

Hong Kong is planning a huge shift from traditional IT datacentres to hybrid clouds over the next five years, following same general deployment trends in global and Asia Pacific region. However, Hong Kong is taking a “private cloud first” approach, – according to the findings of a new report from Enterprise Cloud OS leader, Nutanix (NASDAQ: NTNX).

The report, the Enterprise Cloud Index – which measures enterprise progress on adopting private, hybrid and public clouds – was conducted by Vanson Bourne on behalf of Nutanix across 2,650 IT decision makers in 24 countries including Hong Kong.

Study respondents indicated an aggressive shift away from traditional datacentres, where Hong Kong remains heavily dependent: Hong Kong has the highest penetration of traditional datacentres than any other country in Asia Pacific and japan and the second highest globally, with 76% of local respondents reporting non-cloud-enabled datacentres as their current primary deployment model.

When it comes to the preferred future model, Hong Kong is planning a “private cloud first” approach over the next five years, with a stated plan to migrate investment in hybrid cloud.

According to the report, while public cloud investment will remain relatively flat over the coming year, planned investment in private cloud is predicted to nearly double, while traditional datacentres look set to plummet 37.5% over the same time period.

The report finds that over the next few years, Hong Kong respondents are planning to triple their hybrid cloud investment, from 13% to 38%, while almost 70% of those surveyed locally agree or strongly agree that hybrid cloud is the ideal cloud model for their IT environment.
The major reason cited for this shift was the flexibility of hybrid cloud to match workloads to ever-changing environments – at an affordable cost. For details, please refer to Figure 5 in “2019 Enterprise Cloud Index – How Hong Kong Compares” report (Page 5).

Hong Kong respondents also considered the hybrid model to be more secure than other solutions, including traditional datacentres.

However, despite local enterprises sharing the same positive attitudes towards hybrid cloud as the rest of the world, Hong Kong still lags the global average in terms of planned infrastructure deployment over the next 5 years. For details, please refer to Figure 1 in “2019 Enterprise Cloud Index – How Hong Kong Compares” report (Page 3).

Other key findings from the report include:
Security remains the biggest factor impacting enterprises’ future cloud strategies. Nearly half of Hong Kong respondents (47%) and over half of global respondents (60%) said that the state of security among clouds would have the biggest influence on their cloud deployment plans going forward.

However, Hong Kong enterprises also consider “performance” as the top variable in determining where an enterprise runs a given workload (19%), while data security and compliance only comes in second (17%). Total cost of ownership (16%) also makes it to the top 3 factors in deciding where to put workloads.

Hong Kong’s plans for collecting and analysing data at the edge play a significant role in its cloud computing decisions, ranking it higher (45%) than all other countries. This relates to how Hong Kong is the least likely to outsource compute and storage infrastructure (39%) than any other country globally. Hong Kong is also ranked second lowest for outsourcing analytics and big data platforms.

Hong Kong is open to the idea of using hosted or managed cloud services to fill in the IT skills gap. More than half of Hong Kong companies (51%) agreed that they lack internal IT skills required to meet business demand, and 65% agreed that leveraging a hosted/managed cloud service would help them reduce the size of their internal IT staff.

Hong Kong is a clear outlier in viewing artificial intelligence/machine learning as negatively impacting their business, with 15% of Hong Kong respondents agreeing this is so. This may be partially due to IT feeling they are not ready: when asked to rank where IT skills were lacking, they ranked AI at the top of the list (36%).
“As organizations continue to grapple with complex digital transformation initiatives, flexibility and security remain critical components to enable seamless and reliable cloud adoption,” said Edward Yeung, Managing Director of Hong Kong and Taiwan, for Nutanix.

“This Enterprise Cloud Index report shows Hong Kong’s enterprises have progressed in their understanding and adoption of hybrid cloud. And despite lagging other countries in their cloud migration journey, they fully understand that there is no runway to the cloud without HCI and the app mobility, cross-cloud management tools, and security measures it brings.”

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