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U.S. Firms Embrace Hybrid Clouds — While Watching Costs

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Information Services Group (NASDAQ: III) has released a report showing a significant shift towards private and hybrid cloud solutions among U.S. enterprises. As costs rise, companies are adopting FinOps frameworks to better manage cloud expenses, promoting efficiency and ROI. The report highlights that many firms use hybrid cloud strategies to enhance marketing through advanced data analytics. It evaluates the capabilities of 58 providers, naming Ensono, Kyndryl, and Rackspace as leaders. The trends indicate that managed cloud services are on the rise, reflecting a growing focus on cost optimization and operational agility.

Positive
  • Increasing adoption of FinOps frameworks to manage and optimize cloud costs.
  • Hybrid cloud strategies allow enterprises to enhance marketing through better customer data analytics.
  • The report identifies several market leaders in cloud services, indicating competitive strengths.
Negative
  • None.

As more enterprises move to the cloud for agility and savings, FinOps frameworks to control cloud costs are gaining traction, ISG Provider Lens™ report says

STAMFORD, Conn.--(BUSINESS WIRE)-- Enterprises in the U.S. are accelerating their migration to private and hybrid clouds, while also acting to rein in their cloud costs, according to a new research report published today by Information Services Group (ISG) (Nasdaq: III), a leading global technology research and advisory firm.

The 2022 ISG Provider Lens™ Next-Gen Private/Hybrid Cloud Data Center Services and Solutions report for the U.S. finds that distributing IT resources across hybrid clouds is becoming the norm for U.S. enterprises. Facing the growing cost and complexity of operating on-premises IT infrastructure, most organizations are outsourcing their data centers or migrating applications to public and private clouds.

To use the cloud more intelligently, many advanced enterprises are also adopting frameworks to track and optimize cloud computing activity throughout their organizations, the report says. These frameworks are based on the principles of FinOps, a way of looking at cloud-based operations through a financial lens, which is fast gaining traction. FinOps is designed to reduce cloud costs, which in some cases have ballooned as different departments pursued separate cloud initiatives.

“Private and hybrid clouds can make enterprises more efficient, but to maximize return on investment, companies need to coordinate and optimize their cloud strategy,” said Bernie Hoecker, ISG partner, Enterprise Cloud. “FinOps offers a way to do this, helping to dramatically reduce cloud costs.”

A FinOps framework provides a holistic view of cloud implementations across an organization and is a way for each department to justify and optimize its own cloud use, the report says. This helps identify and remove inefficiencies, such as by consolidating small, departmental Microsoft 365 implementations.

Many U.S. enterprises see hybrid clouds as a way to generate new sources of revenue, the report says. For example, cloud-based platforms can help companies better analyze customer information for more effective marketing. This strategy is particularly popular in the U.S., where enterprises face fewer constraints on the use of customer data than in other regions, such as Europe.

“Moving to the cloud makes it easier for companies to implement next-generation data analytics platforms,” said Jan Erik Aase, partner and global leader, ISG Provider Lens Research. “This agility is essential to remaining competitive.”

The report also quantifies the growth of managed cloud services in the Americas and examines several other trends, including the increasing importance of agile security capabilities and edge computing.

The 2022 ISG Provider Lens™ Next-Gen Private/Hybrid Cloud Data Center Services and Solutions report for the U.S. evaluates the capabilities of 58 providers across four quadrants: Managed Services for Large Accounts, Managed Services for Midmarket, Managed Hosting, and Colocation Services.

The report names Ensono, Kyndryl and Rackspace Technology as Leaders in two quadrants. It names Accenture, Capgemini, Cognizant, CoreSite, CyrusOne, Cyxtera, DataBank, Digital Realty, Equinix, HCL, Hexaware, Infosys, LTI, Lumen, Mphasis, NTT Ltd., QTS, TCS, Unisys, Wipro and Zensar as Leaders in one quadrant each.

In addition, Navisite, NTT Ltd. and Unisys are named as Rising Stars — companies with a “promising portfolio” and “high future potential” by ISG’s definition — in one quadrant each.

Customized versions of the report are available from Hexaware and Unisys.

The 2022 ISG Provider Lens™ Next-Gen Private/Hybrid Cloud Data Center Services and Solutions report for the U.S. 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 800 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 1,300 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.

Press Contacts:

Will Thoretz, ISG

+1 203 517 3119

will.thoretz@isg-one.com

Julianna Sheridan, Matter Communications for ISG

+1 978-518-4520

isg@matternow.com

Source: Information Services Group, Inc.

FAQ

What does the recent ISG report say about the adoption of FinOps frameworks among U.S. enterprises?

The ISG report indicates that U.S. enterprises are increasingly adopting FinOps frameworks to manage cloud costs effectively and improve operational efficiency.

Which companies are recognized as leaders in the ISG Provider Lens report for cloud services?

The report names Ensono, Kyndryl, and Rackspace Technology as leaders in various quadrants for cloud services.

How are U.S. enterprises utilizing hybrid cloud solutions according to the ISG report?

U.S. enterprises are leveraging hybrid cloud solutions to improve data analytics capabilities for effective marketing and to optimize operational efficiency.

What is the significance of the ISG Provider Lens report for investors in III?

The report highlights industry trends toward cost optimization and improved cloud strategies, which can positively impact the business outlook for III and its investors.

What key trends in cloud services does the ISG report highlight?

The ISG report highlights the growth of managed cloud services, the increasing importance of agile security, and the rise of edge computing.

Information Services Group, Inc.

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