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Cloud Hangover costs an average of more than £486 million every year

17th April 2015

During my time at Sungard Availability Services (and that’s more than 35 years!) I have witnessed the market progressively move towards what we now know as cloud computing, including the rise of grid and utility computing. The excitement and hype around cloud computing has been unprecedented in the last five years, and rightly so. Nothing has had quite the same impact on the market. The benefits of cloud computing span all facets of an organisation, enabling a shift from capital intensive to operational cost models, greater efficiency and agility, and the potential for reduced complexity. And as adoption matures, it’s being used to direct the focus of IT resources onto higher-value activities for the business, and to support innovation at lower risk.

However, now that the hype has died down and adoption is more widespread, a few cracks have started to appear within the cloud. We’ve had more organisations then ever approaching us to ask for advice around how to implement and manage the cloud for the longer term as a core part of their IT and business strategy. Many caught up in the cloud hype have seen substantial benefits, but we are also hearing that some are facing a new set of challenges…something we describe as the ‘Cloud Hangover’. It is these new challenges that led us to conduct research into the state of the cloud industry to find out the issues organisations are facing having adopted the cloud, and how we could help them overcome them, to ensure that they are reaping the full benefits.

To find out more about these challenges and how they have affected organisations, Sungard Availability Services interviewed 400 IT decision makers within the UK, France, Sweden and Ireland. The results are far from rosy, with many organisations now finding themselves with a Cloud Hangover after having joined the initial cloud party.

“This hangover is costing European businesses an average of more than £486 million every year; with the overwhelming majority of businesses (81%) in the UK, Ireland, France and Sweden having encountered some form of unplanned cloud spend.”

— Keith Tilley, EVP Executive Vice President, Global Sales & Customer Services Management, Sungard AS

Not only is each organisation within these countries paying an average of £240,000 per year to ensure cloud services run effectively, but they have also spent an additional £320,000 over the last five years thanks to unforeseen costs such as people, internal maintenance and systems integration. And despite being hyped as a way to reduce IT complexity, many early adopters of the cloud (43 per cent) have found that the complexity of their IT estate has in fact increased since their initial cloud investment! This loss of control could come back to haunt them the morning after.

Find out more about the Cloud Hangover here.