Cloud Providers: Are Turbulent Skies Ahead for Midsize IT?

Grazed from Midsize Insider. Author: Rick Robinson.

As pilots know, cloudy skies can make for a bumpy ride. According to one analyst firm, IT managers at midsize firms may also need to plan to fly around turbulence. The cloud computing marketplace is maturing amid fierce competition, and as many as one in four of today’s cloud providers could be gone by 2015.

Most of these providers will be acquired by other firms, but there is also the potential for some to go bankrupt. For midsize firms, the risk of turbulence in the cloud could be a serious matter. In the worst case, a cloud provider could evaporate, with its data centers going dark and the data they hold being lost without a trace. That is the nightmare scenario. It is more likely that a cloud provider will disappear through acquisition. The transition might be seamless, or it might mean major changes in service offering, sending some firms looking for alternative solutions…

Changes in the Skies

As Patrick Thibodeau reported in an article on InfoWorld, the forecast of major shifts in the cloud skyscape comes from analyst firm Gartner, which predicts that 25 percent of the top 100 IT service providers will not last through 2015. Gartner analyst William Maurer predicted, "One in four vendors will be gone for whatever reason — acquisition, bankruptcy." In most cases, according to Maurer, acquisition will be the cause…

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