German Firms Using Multicloud Approach to Gain Flexibility

Rhea-AI Summary

The 2023 ISG Provider Lens™ Multi Public Cloud Services report for Germany, published by Information Services Group (ISG) (Nasdaq: III), highlights the rapid expansion of the cloud services market in Germany. The report indicates the increasing adoption of hybrid or multicloud environments by German companies to negotiate usage prices and maintain flexibility. The importance of FinOps tools to optimize cloud costs has grown significantly, with service providers playing a crucial role in cost management. The report evaluates the capabilities of 94 providers across eight quadrants, naming several companies as Leaders and Rising Stars.

Insights

Financial Analyst

With German enterprises increasingly adopting hybrid and multicloud environments, there is a clear shift towards diversification in cloud service procurement. This trend is strategically significant as it diminishes the risk of vendor lock-in, which can lead to less bargaining power and higher costs for businesses. By engaging with multiple hyperscalers, companies can leverage competitive pressures to negotiate better terms. This development is likely to intensify competition among cloud providers, potentially impacting their market share and revenue streams.

The rise of FinOps as a cost management tool reflects a broader industry need for enhanced financial governance of cloud expenditures. As businesses scale their cloud infrastructure, the complexity of managing costs increases. FinOps offers a systematic approach to managing cloud costs, which can lead to more predictable spending patterns and potentially enhanced profitability for companies that implement it effectively. This could be a value proposition for service providers specializing in FinOps, suggesting a growth area within cloud services. The financial performance of these providers may benefit from the increased demand for their expertise, which could be reflected in their stock valuations.

Market Research Analyst

The ISG Provider Lens™ report underscores a burgeoning demand for cloud expertise in Germany, a key European market. As German companies seek to optimize their cloud investments, the demand for consulting, transformation and managed services is expected to grow. This presents significant opportunities for the named 'Leaders' in the report, who may experience increased business from enterprises looking to navigate the complex cloud services landscape. The recognition of these providers could influence procurement decisions, potentially leading to increased market share and enhanced reputational capital.

Moreover, the identification of 'Rising Stars' indicates a dynamic market with new entrants poised to disrupt the status quo. These companies might attract investor attention as they represent potential growth and innovation within the cloud services sector. Their trajectory could influence investment strategies, with stakeholders looking to capitalize on emerging trends and technologies.

IT Industry Analyst

The emphasis on multicloud environments and FinOps tools indicates a maturing cloud services market where efficiency and cost management have become paramount. Enterprises are not just looking for cloud capabilities, but also for partners that can help them navigate the financial complexities associated with cloud adoption. This trend is likely to influence the development of cloud services, with a possible increase in offerings that integrate financial management tools and services.

The evolution of cloud services towards more financial transparency and control could drive innovation in the sector, with service providers potentially developing more sophisticated FinOps tools and services. This could lead to a differentiation in the market, where providers not only compete on technical capabilities but also on the ability to deliver cost-effective solutions. As such, companies that excel in integrating FinOps practices into their offerings may gain a competitive advantage, potentially affecting their market positioning and investment attractiveness.

Enterprises are opting for distributed cloud environments and FinOps tools to help keep cloud expenditures in check, ISG Provider Lens™ report says

FRANKFURT, Germany--(BUSINESS WIRE)-- The cloud services market in Germany is expanding rapidly, driven by digital transformations aimed at business growth and improving customer experience, according to a new research report published today by Information Services Group (ISG) (Nasdaq: III), a leading global technology research and advisory firm.

The 2023 ISG Provider Lens™ Multi Public Cloud Services report for Germany finds many German companies are setting up hybrid or multicloud environments and engaging with more than one cloud services provider. These companies recognize the vendor lock-in practices of some public cloud providers can leave little room for negotiation and lead to higher costs, the ISG report says.

“German firms have gained added flexibility to negotiate usage prices by working with more than one hyperscaler,” said Matthias Paletta, ISG director, technology modernization, based in Germany. “That has made the cloud services market larger and more competitive.”

ISG research indicates almost three quarters of public cloud customers worldwide use a multicloud environment, and that trend is expected to continue.

Even in a competitive market, the complexity of cloud environments can still make it difficult to keep costs under control. According to the ISG report, service providers can play an important role here, as they have many years of experience managing cloud infrastructures and assets and can support companies with efficient cost management. One of the most useful tools in the provider toolkit is FinOps, ISG says.

The importance of FinOps to optimize cloud costs has grown significantly in recent years, the ISG report says. In a comparatively short time, FinOps has established itself as an integral part of every managed services contract, ISG says.

FinOps frameworks analyze and forecast usage, pricing and financial impact. Service providers can use FinOps tools to gain visibility into cloud resources, capacity utilization and costs, the report says. They often use financial dashboards and cost analysis tools for a more transparent view of variable costs associated with cloud providers, the ISG report says.

“Cost optimization is paramount,” said Jan Erik Aase, partner and global leader, ISG Provider Lens Research. “Enterprises are relying on FinOps to save costs and better control their expenditure by identifying unused resources and using reserved or spot instances.”

The report also examines how some providers are setting up specialized training programs to close the gap between the supply and demand for cloud expertise.

The 2023 ISG Provider Lens™ Multi Public Cloud Services report for Germany evaluates the capabilities of 94 providers across eight quadrants: Consulting and Transformation Services for Large Accounts, Consulting and Transformation Services for the Midmarket, Managed Services for Large Accounts, Managed Services for the Midmarket, FinOps Services and Cloud Optimization, Hyperscale Infrastructure and Platform Services, SAP HANA Infrastructure Services and Secure Enterprise Filesharing Services.

The report names Accenture/Accenture (Wabion), Arvato Systems, CANCOM, Capgemini, HCLTech and Microsoft as Leaders in three quadrants each, while AWS, Claranet, Deutsche Telekom GK, Google, Infosys, Kyndryl, NTT DATA, Rackspace Technology, TCS, T-Systems and Wipro are named as Leaders in two quadrants each. All for One Group, Atos, Axians, Box, Brainloop, DRACOON, Dropbox, Eviden, FTAPI, IBM/IBM (Nordcloud), IONOS, PlusServer, Reply and Syntax are named as Leaders in one quadrant each.

In addition, Syntax is named as a Rising Star — a company with a “promising portfolio” and “high future potential” by ISG’s definition — in two quadrants, while DATAGROUP, idgard, OVHcloud, Randstad Digital, Skaylink and STACKIT are named as Rising Stars in one quadrant each.

Customized versions of the report are available from CANCOM, DRACOON, IONOS, Randstad Digital, Skaylink, STACKIT and T-Systems.

The 2023 ISG Provider Lens™ Multi Public Cloud Services report for Germany is available to subscribers or for one-time purchase on this webpage.

About ISG Provider Lens™ Research

The ISG Provider Lens™ Quadrant research series is the only service provider evaluation of its kind to combine empirical, data-driven research and market analysis with the real-world experience and observations of ISG's global advisory team. Enterprises will find a wealth of detailed data and market analysis to help guide their selection of appropriate sourcing partners, while ISG advisors use the reports to validate their own market knowledge and make recommendations to ISG's enterprise clients. The research currently covers providers offering their services globally, across Europe, as well as in the U.S., Canada, Brazil, the U.K., France, Benelux, Germany, Switzerland, the Nordics, Australia and Singapore/Malaysia, with additional markets to be added in the future. For more information about ISG Provider Lens research, please visit this webpage.

A companion research series, the ISG Provider Lens Archetype reports, offer a first-of-its-kind evaluation of providers from the perspective of specific buyer types.

About ISG

ISG (Information Services Group) (Nasdaq: III) is a leading global technology research and advisory firm. A trusted business partner to more than 900 clients, including more than 75 of the world’s top 100 enterprises, ISG is committed to helping corporations, public sector organizations, and service and technology providers achieve operational excellence and faster growth. The firm specializes in digital transformation services, including automation, cloud and data analytics; sourcing advisory; managed governance and risk services; network carrier services; strategy and operations design; change management; market intelligence and technology research and analysis. Founded in 2006, and based in Stamford, Conn., ISG employs more than 1,600 digital-ready professionals operating in more than 20 countries—a global team known for its innovative thinking, market influence, deep industry and technology expertise, and world-class research and analytical capabilities based on the industry’s most comprehensive marketplace data. For more information, visit www.isg-one.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240109100836/en/

Press Contacts:

Philipp Jaensch, ISG

+49 151 730 365 76

philipp.jaensch@isg-one.com

Matthias Longo, for ISG

+49 152 341 464 63

matthias@longo-pr.de

Source: Information Services Group, Inc.

FAQ

What is the 2023 ISG Provider Lens™ Multi Public Cloud Services report for Germany?

The 2023 ISG Provider Lens™ Multi Public Cloud Services report for Germany is a research report published by Information Services Group (ISG) (Nasdaq: III) that highlights the rapid expansion of the cloud services market in Germany.

What are the key findings of the report?

The report indicates the increasing adoption of hybrid or multicloud environments by German companies to negotiate usage prices and maintain flexibility. It also emphasizes the significance of FinOps tools to optimize cloud costs, with service providers playing a crucial role in cost management.

How many providers does the report evaluate?

The report evaluates the capabilities of 94 providers across eight quadrants.

Which companies are named as Leaders and Rising Stars in the report?

Several companies, including Accenture/Accenture (Wabion), Arvato Systems, CANCOM, Capgemini, HCLTech, Microsoft, AWS, Claranet, Deutsche Telekom GK, Google, Infosys, Kyndryl, NTT DATA, Rackspace Technology, TCS, T-Systems, Wipro, Syntax, DATAGROUP, idgard, OVHcloud, Randstad Digital, Skaylink, and STACKIT, are named as Leaders and Rising Stars in the report.