Where SMBs are with the cloud

As I said the other week, small businesses can still do well by sticking with their own servers. That said, many of them are also moving toward the cloud.

We’re in a time of transition: as the most recent annual Flexera State of the Cloud Report showed, 53% of small and mid-sized businesses (SMBs) — those with 1,000 or fewer employees — spend more than $1.2 million annually on the cloud.

That’s a jump from 38% who did so just two years ago.

Flexera predicts that within the next year, 63% of SMB workloads and 62% of SMB data will reside in a public cloud. That’s a significant increase.

Several things are driving the shift.

One you might not think of is the COVID-19 pandemic. However, because the pandemic kept IT staffers out of the office and server rooms, 66% of respondents said cloud usage was higher than they’d initially planned.

So, where are your SMB peers going?

Amazon Web Services (AWS) continues to be the leader of the pack. But AWS is no longer having its own way. Indeed, its market share has declined. For example, last year, 53% of SMBs were on AWS.

This year, to date, it’s only 31%.

For bigger businesses, Microsoft Azure has caught up. In some areas, it’s even beating AWS. Who would have guessed that even three years ago?

The same is true with SMBs: Azure is catching up with AWS. And Google Cloud Platform is in third place and gaining.

For enterprises, Oracle Cloud is fourth. Interestingly, the percentage of SMB respondents who report running significant workloads in Oracle Cloud has more than doubled, from 6% to 15% over the last year.

Looking ahead, 31% of SMBs with future projects — indicated by the combination of the clouds they’re experimenting with and planning to use — demonstrated the most interest in the Google Cloud Platform.

It’s followed closely in a three-way tie at 25% by Azure, IBM Cloud, and Alibaba Cloud.

Remember that fewer businesses use just one cloud service, less than 11%. The vast majority, 89%, rely on two or more.

We call that multi-cloud, but that implies a real strategy: that managers have a single pane of glass to watch over all cloud usage. Unfortunately, that’s not, from what I’ve seen, happening. 

Instead, companies tend to pick one cloud for business storage, such as Dropbox or iCloud; another for office Software-as-a-Service (SaaS), such as Google Workspace or Microsoft 365; and yet another for a company’s own apps.

That last one is where you’ll find AWS, Azure, and the other so-called hyper clouds.

Sure, we want to have a central cloud team or a cloud center of excellence (CCOE). Their job is to provide centralized controls, tools, and best practices and to speed up cloud adoption by centralizing expertise while reducing costs and risk.

Many small businesses, 64%, have such teams.

I’ll be honest, though, I haven’t been impressed by many I’ve seen.

If we look at business cloud concerns, you can see why. Our No. 1 concern with a bullet is security. Generally, we trust the cloud more than we once did.

That said, we’re still worried about what might happen to our office and data if something goes awry with our cloud.

Right behind those security worries is a simple fact that no one — and I mean no one —has enough in-house cloud expertise. There are simply not enough cloud experts to go around.

And, just because someone is, for instance, an AWS Certified Cloud Practitioner doesn’t mean they can help a bit with your Google Cloud. Nor can a Google Cloud Digital Leader help you run AWS. 

Finally, everyone needs help managing their cloud spending.

Many of us first moved to the cloud to save money. Now that we’ve made that move, we’re finding out that losing money is too easy unless we keep a close eye on our cloud cash flow.

Put all these factors together, and it’s easy to see why 57% of all organizations outsource at least some public cloud work. Indeed, 26% engage cloud Managed Service Providers (MSPs) for most of their cloud use.

This is a smart move.

While I love in-house expertise, cloud experts cost a pretty penny. So for many SMBs, as we keep moving into the cloud, I suggest you seriously consider hiring an MSP.

Like it or not, the cloud is the future, and you’ll need all the help you can get to make the cloud work for you.