The State Of The UK Cloud Computing Market

CloudHealth Tech Staff
Published:
Feb. 12, 2019
4 minute read

The state of the UK cloud computing market looks fairly healthy according to the latest BSA/Software Alliance “Global Cloud Computing Scorecard”, in which the UK improved its position from ninth place to fourth place based on Internet connectivity, data security, and intellectual property rights

The BSA/Software Alliance (formerly the Business Software Alliance) is a trade group representing some of the world’s largest software developers. Established by the Microsoft Corporation in 1988, the trade group’s principal activity is preventing copyright infringement. It is one of seven trade groups that form the International Intellectual Property Alliance—an organization that works closely with the U.S. Government to strengthen international copyright protection and enforcement.

 

Since 2012, the BSA/Software Alliance has compiled a biennial “Global Cloud Computing Scorecard” - a report ranking twenty-four countries according to their preparedness for the adoption and growth of cloud computing services. Many of the factors contributing to a country’s ranking relate to cloud security, data privacy, and deterrents against cybercrime. However, one significant factor relevant to the state of the UK cloud computing market is the country’s investment in its broadband infrastructure.

When the first Global Cloud Computing Scorecard was compiled in 2012, the United Kingdom ranked a lowly seventh of the twenty-four countries and subsequently slipped to ninth position overall in 2016. However, in the latest report (PDF), the UK has improved its position to fourth place partly due to the successful implementation of a National Broadband Plan which has resulted in the fastest mobile data connection speeds and highest percentage of the population using the Internet in the world.

Selected Data from the Global Cloud Computing Scorecard

Country

Germany

Japan

U.S.

UK

Australia

Overall Position

1

2

3

4

5

Population (millions)

83

127

325

64

24

Per Capita GDP (US$)

41,313

32,477

56,116

43,876

56,311

ICT Service Exports (US$ bn)

104

37

171

132

9

IT and Network Readiness

8.31/10

8.37/10

8.17/10

8.57/10

8.19/10

% of Households with PCs

91

80

87

90

83

Mobile Subscription %

71

128

115

88

113

Av. Mobile Data Speed

24 Mbps

16 Mbps

11 Mbps

26 Mbps

16 Mbps

% of pop Using the Internet

88

91

74

92

85

Other factors that contributed to the UK’s improved cloud computing readiness rating included the release of a National Cybersecurity Strategy, the introduction of the EU-wide General Data Protection Regulation (GDPR), and the enforcement of advanced intellectual property laws. It is also noticeable that the United Kingdom has extensive net neutrality laws and Amazon, Microsoft, and Google each have regional data centers located in London.

How the Speed of Delivery Affects the UK Cloud Computing Market

One of the often-quoted advantages of migrating to the cloud is “speed of delivery”. However, in the UK, this is not an issue—leaving businesses free to focus on other areas such as flexibility, scalability, and saving costs. This gives businesses migrating to the cloud a domestic commercial advantage over those who rely on on-premises legacy systems, and an international commercial advantage over businesses in countries with slower broadband speeds or further away from CSPs’ data centers.

Many businesses have identified this fact and are migrating to the cloud at a rate above that of the global average. In its latest annual report on the state of the UK cloud computing market (subscription required), the Cloud Industry Forum identified a year-on-year 5 percent increase in cloud adoption, with 88 percent of businesses now using cloud-based services. The number of public sector organizations migrating to the cloud also increased significantly—up from 62 percent in 2016 to 82 percent.

The report identified an increase in hybrid cloud strategies due to concerns about compliance with data privacy regulations (i.e. the EU’s GDPR) and a higher-than-average number of businesses and organizations (63 percent) using the public cloud for data backup and disaster recovery. Disaster-Recovery-as-a-Service is one of the fastest growing areas of the UK cloud computing market and is expected to grow at a Compound Annual Growth Rate of more than 40 percent over the next five years.

Issues Affecting the UK Cloud Computing Market

Despite the “speed of delivery” benefits of operating in the UK cloud computing market, businesses in the UK experience many of the same issues as businesses worldwide—especially when taking that initial step from on-premises infrastructure into the cloud. According to the Cloud Industry Forum report, it took an average of fifteen months for businesses to migrate to the cloud due to the complexity of the process and a nationwide lack of the necessary skills to deliver a successful migration.

Alex Hilton, CEO of the Cloud Industry Forum, commented: “While smaller businesses are able to make the logical step to remove their depreciated hardware assets and move entirely to the cloud, this is less feasible for larger organizations with heavy infrastructure investments. Therefore, ‘cloud everything’ will not be attainable for all for some time and we predict that the vast majority of companies will continue to maintain hybrid IT environments.”

An ideal solution to overcome these issues is CloudHealth’s Migration Assessmenta process that recommends what businesses’ new cloud footprint should look like based on the utilization or configuration of on-premises servers. The result of the Assessment is an overall total cost of ownership of migrating workloads and recommendations about which types of cloud servers make the most sense so that businesses can plan the workload migration with complete confidence.