FLEXERA?

2024Stateof

theCloudReport

AIexperimentationoutpacesusage;

SaaSandcloudcostshighbutimproving

AWSandAzurecontinuetobattlefordominance

2024STATEOFTHECLOUDREPORT

Reporthighlights4

Organizationsembracemulti-cloud

4

Whatchallengesdoyoufaceinmigrating

workloadstopubliccloud?

5

DoesyourcompanyhaveaFinOpsteamtoadvise,

manageorexecutecloudcostoptimizationstrategies?

5

Whatpubliccloudprovidersdoes

yourorganizationuse?

6

UseofgenerativeAI(GenAI)

publiccloudservices

6

Cloudcostoptimizationandsustainabilityprioritization

6

Methodology

8

Whatsizeisyourorganization?

9

What’syourcompany’sindustry?

10

Whereareyourheadquarterslocated?

11

What’syourrole?

12

Whereintheorganizationdoyouwork?

13

What’syourcompany’susagelevelofpubliccloud?

What’syourinvolvementwithcloud

14

inyourorganization?

15

Organizationsareembracing

multi-cloud

16

Organizationsembracemulti-cloud

16

Hybridcloudstrategies

17

Useofmulti-cloudarchitecturesbyallorganizations

18

Useofmulti-cloudtools

19

Publicvs.privatecloudusage

20

》》Tableofcontents

Publiccloudadoptioncontinues

toaccelerate

21

What’syourcurrentannualpubliccloudspend?

21

What’syourcurrentannualSaaSspend?

22

Non-SaaSsoftwarecostsbyvendor

23

Non-SaaSsoftwarepurchasemethods

Doyoutracklicensesforsoftware

24

runninginthecloud?

25

Workloadsinpubliccloud

26

Datainpubliccloud

27

What’syourapproachformigrating

datatopubliccloud/SaaS?

28

Whatchallengesdoyoufaceinmigrating

workloadstopubliccloud?

29

Cloudinitiativesandmetrics

30

Whichofthefollowinginitiativesareyouplanning

tomakeprogressoninthenextyear?

Topcloudinitiativesbycloudusage

30

forallorganizations

31

Whatareyourtopmetricsforassessingprogress

againstcloudgoals?

32

Organizationsaretakinga

centralizedapproachtocloud

Doesyourcompanyhaveacentral

33

cloudteamorCCOE?

33

DoesyourcompanyhaveaFinOpsteamtoadvise,

manageorexecutecloudcostoptimizationstrategies?

Whoinyourorganizationleadscloudcost

34

managementresponsibilities?

35

UtilizationofMSPsformanagingpubliccloud

forallorganizations

36

Enterprisevs.SMBMSPutilizationformanaging

publiccloud

37

Topchallengesaresecurity,

spendandexpertise

38

Topcloudchallenges

38

2

?2024Flexera

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?2024FlexeraHELPFULTIP:ClickthisiconfortheTableofContents3

Privatecloudplaysanimportantrole58

Privatecloudtechnologiesusedbyallorganizations58

Enterpriseprivatecloudtechnologies59

SMBprivatecloudtechnologies60

Doesyourorganizationhaveadefinedsustainability

initiativethatincludescarbonfootprinttracking

ofclouduse?61

Cloudcostoptimizationandsustainability

prioritization62

StateoftheCloudReport:

Europeanspotlight63

Europeanrespondentsbyorganizationsize63

Europeanrespondentsbyindustry64

Europeanrespondentsbycountry65

Europeanrespondentsbyrole66

Europeanrespondentsbywhere

intheorganizationtheywork67

Europeanrespondentsbycloudusagelevel68

EuropeanadoptionofcentralcloudteamorCCOE69

CloudmigrationchallengesforEuropeanorganizations70

CloudinitiativesforEuropeanorganizations71

PubliccloudprovideradoptionratesforEuropean

organizations72

DoesyourcompanyhaveaFinOpsteamtoadvise,

manageorexecutecloudcostoptimizationstrategies?73

Doesyourorganizationhaveadefinedsustainability

initiativethatincludescarbonfootprinttracking

ofclouduse?74

UtilizationofMSPsformanagingpubliccloud

forEuropeanorganizations75

Cloudinitiativesmove

fullspeedahead76

AboutFlexera76

》》Tableofcontents(cont.)

Organizationsstruggletocontrol

growingcloudspend

39

What’syourorganizationalspendonpubliccloud?

What’syourestimatedwastedcloudspend

39

onIaaSandPaaS?

40

What’syourestimatedwastedsoftwarespend

inthecloud?

41

Whichproviderdiscountsdoyouuse?

42

Whattypesofpoliciesdoyouusetooptimize

cloudcosts?

43

ManagementofSaaSandsoftwarecosts

comparedtoIaaS/PaaScosts

44

Doesyourorganizationuseauniteconomics

modelforcloudcostanalysis?

45

Publiccloudadoptionisevolving

Whatpubliccloudprovidersdoes

46

yourorganizationuse?

46

YoYpubliccloudprovideradoption

ratesforallorganizations

47

Enterpriseuseofpubliccloudproviders

48

YoYenterprisepubliccloudadoption

49

SMBuseofpubliccloudproviders

49

YoYSMBpubliccloudadoption

50

Howmuchdoyouspendoneachcloudprovider?

51

Enterprisepubliccloudspend

52

SMBpubliccloudspend

53

HowmanyVMsdoyouhaveineachcloudprovider?

54

UseofpubliccloudPaaSservicesis

increasing

55

Publiccloudservicesusedforallorganizations

55

Publiccloudservicesusedbyenterprises

56

UseofgenerativeAI(GenAI)publiccloudservices

57

2024STATEOFTHECLOUDREPORT

?2024Flexera4

TheFlexera2024StateoftheCloudReportshedslightoncloudcomputingtrendsandthepressuresfacingITprofessionalsandthestrategicinitiativesthey’reutilizingtoremaincompetitiveintoday’sdynamicandevolvinglandscape.

Reporthighlights

Here’sasampleofkeyfindingsfromthisyear’sreportbasedonasurveyof753clouddecision-makersandusersfromaroundtheworld.

?2024Flexera5

2024STATEOFTHECLOUDREPORT

2024STATEOFTHECLOUDREPORT

?2024Flexera6

2024STATEOFTHECLOUDREPORT

?2024Flexera7

Inthefaceofongoingeconomicuncertainties,manyorganizationsareinvestingin

transformativeinitiativessuchasgenerativeAI(GenAI)andsustainability.Atthesametime,

managingcostseffectivelyremainsatoppriority—andtryingtofindabalancebetweenthe

twoisaformidablechallenge.Despitethis,cloudusageisontherise,whilewastedspend

isdecreasing.Hybridcloudstrategiesareevolving,withanotableincreaseinthenumberof

businessesadoptingamorecomprehensiveviewofcostmanagementforhybriddeployments,includingthelicensingofsoftwareusedinthecloud.

Cloudspendingremainssubstantial,asnearlyhalfofallworkloadsanddataarenowinthe

publiccloud.Forthesecondyearinarow,managingcloudexpenseshasemergedasamore

pressingchallengethansecurity,highlightinganintensifiedfocusonFinOpspracticesandtoolsforoptimizingcloudcostsandenhancingefficiency.Thistrendisconsistentwiththebroaderadoptionofmulti-cloudstrategies,theincreaseduseofcloudservices,andtheestablishment.ofcloudcentersofexcellence(CCOEs)inmorethanhalfoftheorganizationssurveyed,

signifyingashifttowardmorecentralizedandstrategiccloudmanagement.

TheFlexera2024StateoftheCloudReportreveals:

?Organizationsareembracinghybridcloud

?Publiccloudadoptioncontinuestoaccelerate

?SaaSadoptionisatanall-timehigh,asareSaaSgovernancechallengessuchascostmanagement

?Organizationsaretakingacentralizedapproachtothecloud

?Topchallengesarespend,securityandexpertise

?AWSandAzurecontinuetobattleforthelead

?AI/MLhasnotyettakenflight,butexperimentationishigh

?Whenaskedtoprioritizecloudcostoptimizationandsustainability,companiesoverwhelminglyprioritizecostoptimization

?Europeanspotlight

2024STATEOFTHECLOUDREPORT

?2024Flexera8

Methodology

SMBs:Businesseswithfewerthan1,000employees

Enterprises:Organizationswithmorethan1,000employees

Largeenterprises:

Organizationswithmorethan10,000employees

TheFlexeraStateoftheCloudsurveytapped

753technicalprofessionalsandexecutiveleadersworldwideinthewinterof2023.Thenetwork

includesprofessionalsacrossindustriesandcontextareas.

Flexerasourcesparticipantsfromanindependentpanelthatisrigorouslymaintainedandis

comprisedofvettedrespondentswithdetailed

profiles.Allnumbersandpercentagesareroundedtothenearestwholenumber.

Atnumerouspointsthroughoutthereport,we’veprovidedourowninterpretationofthedataasFlexeraPointsofView.

Reuse

Weencouragethereuseofdata,chartsandtextpublishedinthisreportunderthetermsof

this

CreativeCommonsAttribution4.0InternationalLicense

.YouarefreetoshareandmakecommercialuseofthisworkaslongasyouprovideattributiontotheFlexera2024StateoftheCloudReportasstipulatedinthetermsofthelicense.

2024STATEOFTHECLOUDREPORT

Thisyear’ssurveyleanstowardenterprises,with68%ofrespondentsinorganizationswith

morethan2,000employees.Eightpercenthavemorethan100,000employees.

?2024Flexera9

2024STATEOFTHECLOUDREPORT

Tech-relatedindustries(35%betweensoftware,hosting/cloudprovider/managedservices)

andfinancialservices(19%)leadrespondents’industries,followedbyhealthcare(12%).

?2024Flexera10

2024STATEOFTHECLOUDREPORT

Similartolastyear,nearlytwo-thirdsoftherespondentsarefromtheAmericas(62%are

fromtheU.S.).RespondentsfromEuropemadeup20%ofthetotal,withtheUKaccountingfor9%ofthatgroup.

?2024Flexera11

2024STATEOFTHECLOUDREPORT

Thefollowingfiguresindicatethebreakdownofrespondentsbybusinessroleandwherethey

workwithintheirorganization.Twenty-onepercentofrespondentsarecloudarchitects,and8%reportbeinginaFinOpsrole.Therewasalargegaininrespondentswhosaidtheyworkincentralcloudteams(CCOEorsimilar),increasingto50%thisyearfrom35%lastyear.

?2024Flexera12

2024STATEOFTHECLOUDREPORT

Thereisasignificantincreaseinorganizations

creatingandstaffingaCCOE

?2024Flexera13

2024STATEOFTHECLOUDREPORT

Cloudadoptioncontinuestobecomemoremainstream.Heavyusersnowrepresent71%of

respondents,upfrom65%lastyear.

?2024Flexera14

2024STATEOFTHECLOUDREPORT

MostrespondentshaveasignificantinfluenceonbothIaaS/PaaSandSaaS,withaparticularincreaseinSaaSdecision-making(84%)aswellasusageandcosts(74%).SaaSusersalsoincreasedfrom63%to70%yearoveryear(YoY).

Usersareincreasinglygravitatingtowardtheeaseofuse

andmaintenanceofSaaSofferings

?2024Flexera15

?2024Flexera16

Organizationsareembracingmulti-cloud

Mostorganizationshaveemployedmulti-cloud,with89%ofrespondentsreportinghavingamulti-cloudstrategy(aslightincreasefrom87%in2023).Somerespondentscontinuetoconsolidateonasinglecloud:10%reportasinglepubliccloudthisyear,thesameas2023.

2024STATEOFTHECLOUDREPORT

?2024Flexera17

Morethanhalf(59%)ofrespondentsusemultiplepublicclouds.Fourteenpercentuseasinglepubliccloud.

Agrowingpercentageofrespondentsusemultiplepublic

andoneprivatecloud(upfrom19%to23%YoY)

2024STATEOFTHECLOUDREPORT

?2024Flexera18

AppssiloedondifferentcloudsandDR/failoverbetweencloudsremainthetoptwomulti-cloud

implementations.Appssiloedondifferentcloudsincreasedthemost(upto57%from44%YoY).Dataintegrationbetweencloudsincreasedto45%from37%YoYasorganizationslookforthebestfitforapplicationsanddataanalysis.

》》FLEXERAPOV

Organizationscontinuetofactorincostandperformancepriortodeployingworkloadsinthecloud.Enterprisescontinuetofindthebestfit,oftenrunningapplicationsinasinglecloud,whichsimplifiesconfiguration,maintenanceandsecurity.Agrowingnumberoforganizationsfindusecasesfordataanalysisincloudsseparatefromtheoneanapplicationisrunningin.

2024STATEOFTHECLOUDREPORT

?2024Flexera19

Securitytoolsremaininthetopspotthisyearforallorganizations,followedcloselybycost

optimization(FinOps)toolsandmanagementtools.Ahigherpercentageoflargeenterprisesusesecuritytools(61%)andFinOpstools(57%).

?2024Flexera20

Hybrid,publiccloudonlyandprivatecloudonlyremainedsimilarYoY.

》》FLEXERAPOV

SimilarYoYcloudusageindicatesthatorganizationshaveachievedasteadystate;they’veidentifiedwhatworksforthem.

?2024Flexera21

Publiccloudadoptioncontinuestoaccelerate

Nearlyathirdofallrespondents(29%)arecurrentlyspendingmorethan$12millionayearinpubliccloud,upfrom24%in2023.Thirty-sixpercentofenterprisesspentmorethan$12millionayear,upfrom29%lastyear.

There’sa21%increaseYoYinorganizationsspending$1millionormorepermonthoncloud

2024STATEOFTHECLOUDREPORT

?2024Flexera22

Nearlyaquarterofrespondents(22%)arecurrentlyspendingmorethan$12millionperyearonSaaS.Thisincreasesto26%forenterprises.

Morethanaquarterofrespondentsspendover$12Mperyearon

cloud(29%),andnearlyaquarter(22%)spendthatmuchonSaaS

2024STATEOFTHECLOUDREPORT

?2024Flexera23

Forthefirsttime,Flexeraaskedrespondentsfornon-SaaS(cloudandon-premises)software

costsbyvendor.Microsoftisbyfarthemostcommonnon-SaaSsoftwarevendor(49%).

?2024Flexera24

Inaddition,thevastmajorityofnon-SaaSsoftwarepurchasesaremadedirectlyfromthe

vendor(85%),withtheprimaryvendorbeingMicrosoft.Thesepurchasesaremostlikelymadeunderanexistingenterpriseagreement(EA).

?2024Flexera25

It’spromisingthat84%ofrespondentstracksoftwarelicensesinthecloud.

》》FLEXERAPOV

Cloudcostsareimpactedsignificantlybysoftwarelicenses.Insome

instances,specificlicensescanbemorethanquadruplethecostsofthecloudinfrastructureonwhichtheapplicationsrun.Organizationsneedtonotonlyfactorincloudcosts,butconsidertheassociatedsoftwarelicensingcostsaswell.

?2024Flexera26

Forallrespondents,51%ofworkloadsareinthepubliccloudtoday,withanadditional

7%expectedinthenexttwelvemonths.Halfofallorganizationshavedatainthepubliccloudtoday,withanextra7%expectedinthenexttwelvemonths.Enterpriseshavemorecomplex

environmentsbutslightlylowerusagerates,with49%ofworkloadsinpubliccloudand

48%ofdatainpubliccloud.

SMBsarethehighestcloudadoptersbutfelloffslightlyfromthepreviousyear,with61%(adropfrom67%lastyear)ofworkloadsand60%ofdatainthepubliccloudforbothyears.

?2024Flexera27

?2024Flexera28

Morethanhalfofrespondentssaidthey’llconsidermovingatleastsomeconsumerdataorcorporatefinancialdatatothecloud.Nineteenpercentsaidallconsumerdatawillmovetocloud/SaaS(upfrom17%in2023),and18%saidallcorporatefinancialdatawillmovetocloud/SaaS(thesameasin2023).

Morethanone-thirdofrespondentsindicateall

nonsensitivedatawillmovetothecloudandnearlyone-fifthsaytheywillmoveallsensitivedatatothecloud

?2024Flexera29

Mappingalltherelationshipsacrossapps,hardwareandnetworkingdevicesforeachIT-deliveredserviceisnotoriouslydifficulttodo.Overhalfofrespondentsreported

understandingappdependencies(54%),assessingon-premisesvs.cloudcosts(46%)andassessingtechnicalfeasibility(45%)asthetopthreecloudmigrationchallenges.

Nearlyhalfofrespondentsciteassessing

on-premisesvs.cloudcostsasachallenge

》》FLEXERAPOV

AYoYanalysisofsensitiveconsumerdatashowsaslightcontinuationofmovementawayfromon-premisestowardcloudandSaaS,indicatingorganizationscontinuetobecomemoreconfidentinthesecuritycontrolsthatcloudprovides.

?2024Flexera30

Cloudinitiativesandmetrics

Thisistheeighthyearinarowthatoptimizingtheexistinguseofcloud(costsavings)isthe

topinitiative(increasingfrom62%to71%YoY).Notably,progressingonacloud-firststrategydroppedto48%from55%YoY.Migratingmoreworkloadstocloudincreasedfrom44%to58%YoY.Ahighpercentageofheavycloudusers(73%)seeoptimizingtheexistinguseofthecloud(costsavings)asatopinitiative.

2024STATEOFTHECLOUDREPORT

?2024Flexera31

Optimizingexistinguseofcloudandmigratingmoreworkloads

tothecloudarethetopinitiatives,regardlessofusagelevel

?2024Flexera32

Thetopmetricformeasuringprogressinthecloudhasbeencostefficiency/savingsforthepastsixyears.Thisyear,ithasincreasedto65%from60%YoY.ThenumberofworkloadsmigratedtothecloudhasalsoincreasedYoYfrom31%to36%.

Thecontinuedprioritizationofcostandworkloadsmigratingtothecloudemphasizestheimportanceofcostoptimizationandefficiency

?2024Flexera33

Organizationsaretakingacentralizedapproachtocloud

Mostorganizations(63%)haveaCCOEorplantocreateonewithinthenextyear(14%).SeventypercentoflargeenterprisesalreadyhaveaCCOE,whereasonly29%ofSMBsdo.FifteenpercentofenterprisesexpecttoaddaCCOEinthenexttwelvemonths,and6%expecttoaddone

beyondthattime.Justoveraquarter(26%)ofSMBsareplanningtohaveaCCOEinthefuture.

MorethanhalfoforganizationsalreadyhaveCCOEs;thisproportioncouldjumptomorethan75%inyearstocome

2024STATEOFTHECLOUDREPORT

?2024Flexera34

Halfoforganizations(51%)haveaFinOpsteam,and20%areplanningoncreatingoneinthe

comingyear.

?2024Flexera35

Asusual,infrastructureandopsaswellasCCOEorcloudteamsleadthechargeforcloudcost

management.Infrastructureandopsteamsaremostlikelytogoverncloud(IaaS/PaaS)usage/costs(53%),optimizeSaaSusage/costs(54%)andgovernsoftwarelicensesinIaaS/PaaS(50%).

》》FLEXERAPOV

Evenifsoftwareassetmanagement(SAM)teamsaren’tresponsibleforcloudandSaaScosts,theyneedtoensuretheresponsibleteamshavethedetailedlicensinginformationrequiredtousethoselicenseseffectively,remaincompliant,minimizeriskandsavethecompanymoney.

?2024Flexera36

Fifty-threepercentofallorganizationsareoutsourcingatleastsomepubliccloudwork,

including26%thatusemanagedserviceproviders(MSPs)formostpubliccloudusage.

?2024Flexera37

Fifty-sixpercentofenterprisesareoutsourcingatleastsomepubliccloudwork.SMBusageof

MSPshasincreasedto36%from26%YoY.

?2024Flexera38

Topchallengesaresecurity,spendandexpertise