44% cite upfront costs as major barrier to cloud adoption
UK IT software vendors have been largely overestimating the market’s appreciation and understanding of the terminology surrounding cloud computing in small and medium size enterprises, according to a new research undertaken by Redshift Research on behalf of GFI Software.
The research found that the degree of understanding of cloud computing terminology is lower in the business sector than in the IT security sector with 62% of senior business decision makers have never heard of cloud computing while 24% of IT professionals never heard of cloud computing or do not understand the term.
However, only 15% and 11% of senior business decision makers have not heard of managed services and hosted services, respectively, which are partially synonymous with cloud computing conceptually.
The GFI study, conducted across 250 SMBs in the UK, found that 86% of companies of 100 to 249 staff have deployed or are currently deploying cloud computing technology, but only 69% of companies of 10 to 99 employees, and 39% of companies with under 10 employees have done or are doing so.
According to the research, 44% of those companies that have decided not to deploy cloud computing cite too high cost as the main reason, while 43% of respondents say that they would reconsider if vendors terms and pricing were improved and 40% would reconsider if contracts were less restrictive.
Security is the second highest perceived disadvantage of cloud computing, but only 12% of respondents who have actively elected not to pursue this model cite security as the main reason for not doing so.
In addition, the research also found that among companies that have moved some services over to the cloud, 16% have seen a full return on investment (ROI) in less than six months and the vast majority report full ROI in less than a year.
Walter Scott, CEO of GFI Software, said: “The UK market seems to be confused by jargon and synonymous terminology and appears to have been susceptible to scaremongering by on-premise providers. Unless these trends can be reversed, UK SMEs are unlikely to reap the benefits of cloud computing for many years to come.”