Jeff Kagan: Cloud Analyst Sees Growth Accelerating

Jeff Kagan |

2015 looks like the time when we are all going to start Riding the Cloud. The heat will be turned way up on Cloud adoption. It is going to start becoming mainstream. We have been playing around with it for the last several years. Now things are getting serious. So how will this impact your company’s competitive position? How will it impact you as a worker, user and investor?

As an Industry Analyst I have been watching the growth of the cloud space over the last several years. It has been a rapid growth wave, but we have been experimenting and testing. In 2015, I think we will now start to turn up the temperature and growth will start to get white-hot.

As a speaker at meetings and conferences, I often talk about The Cloud Growth Wave. How companies and opportunities always have a life span. How they start off on the growth side, then crest, then years later start down the other side after the opportunity winds down.

This happens with every company and every opportunity we have ever seen. Either companies change and create the next growth wave, or they don’t.

This Cloud Revolution is still in the early stages of its first growth wave. It will be growing for many years over the next decade as far as we can see right now. This is one of the hottest places to be going forward.

Reporters call me on a daily basis for comments on stories they are writing. As I tell every reporter who asks, this is both a huge opportunity and challenge for everyone in this space.

That means every company in every industry and every worker and every customer. The good news is the Cloud is a unique growth engine and it is just getting started. As with all growth waves, the Cloud will change over time.

Choosing Winners and Losers is Always the Challenge

So if the Cloud space is just starting to get hot, who are the large and small providers today? Who are the well-known and unknown brands? Some of them are heavily into this space while others are still testing. This means users and service providers.

There is an enormous growth wave opportunity ahead for large and small companies like Apple (AAPL) , Google (GOOG) , AT&T (T) , Verizon (VZ) , Sprint (S) , T-Mobile (TMUS) , CenturyLink (CTL) , SAP (SAP) , Comcast (CMCSA) , Carbonite (CARB) , LifeLock (LOCK) , (AMZN) , Microsoft (MSFT) , IBM (IBM) , Oracle (ORCL) , HP (HPQ) , Rackspace (RAX) , ServiceNow (NOW) , Workday (WDAY) , demandware (DWRE) , Qualys (QLYS) and many more.

In fact, there will be hundreds, maybe thousands of different companies operating in different sectors or segments of the cloud space. While this makes it more difficult to compare and track, this is still a very important key showing rapid growth the cloud space today.

Companies in the business of making cloud technology are seeing enormous growth. I expect this to continue going forward. Unfortunately, it’s more difficult to say which companies will continue to do well. Each has to be determined on it’s own.

How companies use the cloud can be different.

Some are using the cloud to keep corporate data for use by employees rather than storing information to countless laptops. Others are using the cloud to do business with their customer base.

One example is Netflix (NFLX) . This company started out as a competitor to Blockbuster. They mailed movie DVD’s to customers. Now they make movies available for download over the Internet using their cloud service.

The Netflix of today is much different than the Netflix of yesterday. And the Netflix of tomorrow will be just as different from the Netflix of today. The cloud transformed their business model and they are very rapidly growing into different industry segments now.

The Future is All About the Cloud

The Cloud changes business models of all sorts of companies. Whether they are all in, or just experimenting, all companies are keeping their eyes on the Cloud and the leaders are jumping in today, full speed ahead.

There are many reasons, but it's important to recognize the Cloud is one of the newest, hottest and biggest opportunities we have ever seen. It’s a competitive advantage.

The Cloud will impact every business, every government agency, every customer and every worker going forward. It will transform entire industries.

As I give speeches, I share information to wake up the audience. They are always surprised and delighted to hear how nearly 80% of all data was created in just the last year or two.

That’s an incredible statistic and is one of the main reasons why we need the cloud going forward. It’s how we will manage our growing amount of information and data, whether we are a company or an individual user.

That’s why I say tomorrow is all about the Cloud. This is one of the biggest change waves we will see in our lifetimes.

However it’s also important to recognize that not every company will be successful with the Cloud. And even those who start out successful early on may not stay successful going forward.

As an example, think of companies like Prodigy and America On Line (AOL) as examples of Internet Service Providers from the 1990s. They led that space back then. However, today the biggest ISP’s in the space are companies like AT&T, Verizon, CenturyLink, Comcast and Time Warner Cable.

So What is the Cloud?

There are many definitions of the Cloud depending on the slice of the pie we are discussing.

If you are an end user, the cloud may be an account you open with a service provider like Apple iCloud or Google Cloud to store your own personal data online rather than on your hard drive.

If you are a company, it may be storing data created by your workers. Think of the cloud as one giant hard drive, storing data from countless users, all online.

The cloud is also how companies will interact with customers and users going forward.

There are lots of benefits like easy storage and access for users on any device whether that be a computer, tablet, smartphone or whatever else we use. Also, if you lose your laptop, you don’t lose your data.

On the other side of the same cloud coin, there are also lots of risks like data break-in’s, data loss or viruses.

However the benefits of the cloud far outweigh the risks, so will keep us on this path.

Several Different Cloud Types

  • Some clouds are individually contracted for and owned by users who pay a monthly fee for storage to companies like Apple iCloud or Google Cloud.
  • Some are corporate clouds. These may be an outside service contracted for with the company, or they can be completely owned and operated by their own workers. There are a wide variety of companies in this space, large and small.
  • Corporate clouds can be private or public depending on the information stored and the users accessing it.
  • Hybrid clouds mix public and private clouds.

Companies often use a variety of different cloud databases to keep data separate and secure. The level of security is different for each depending on the importance of the data. This will continue to evolve over time. 

Security is always a concern because once information is up on the cloud it is vulnerable. Then again, even data on your companies own system is susceptible.

However even with all this concern, Cloud growth will continue. The reason: the Cloud simply makes too much sense. Period.

Think of the Cloud like the wild-wild-west. Like the early days of the Internet twenty years ago where there were no rules, just growth.

Competitive Advantage with the Cloud

Early adopters will have a competitive advantage. Then over the next several years it will shift to a time when not being on the cloud is a competitive disadvantage. Everybody will be getting on the Cloud in the next several years.

I look forward to following the movers and shakers in this new Cloud space. I will write about them and tell you all about this growing space, companies and technologies.

Any way you slice it, the Cloud will change our lives going forward whether we are a company, worker or investor. Are you ready?

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to:


Symbol Name Price Change % Volume
AAPL Apple Inc. 117.50 -0.15 -0.13 16,290,695
AMZN Inc. 840.07 1.98 0.24 1,741,656
CARB Carbonite Inc. 16.87 -0.25 -1.46 93,415
CMCSA Comcast Corporation Class A Common Stock 65.25 0.29 0.45 4,160,607
CTL CenturyLink Inc. 28.51 0.19 0.67 1,350,529
DWRE DEMANDWARE INC. n/a n/a n/a 0
GOOG Alphabet Inc. 808.38 -4.73 -0.58 822,597
HPQ HP Inc. 13.91 -0.07 -0.47 4,428,754
IBM International Business Machines Corp 150.46 -0.11 -0.07 1,093,938
LOCK LifeLock Inc. 17.14 0.12 0.71 218,120
MSFT Microsoft Corporation 60.90 -0.10 -0.16 18,370,614
NOW ServiceNow Inc. 79.97 -1.03 -1.27 815,648
ORCL Oracle Corporation 38.33 0.06 0.16 4,295,203
QLYS Qualys Inc. 36.93 -1.08 -2.83 55,206
RAX Rackspace Hosting Inc 31.90 -0.02 -0.06 630,426
S Sprint Corporation 6.41 -0.52 -7.44 24,359,392
SAP SAP SE ADR (Sponsored) 88.18 -0.15 -0.17 310,687
T AT&T Inc. 36.77 -0.09 -0.24 18,431,169
TMUS T-Mobile US Inc. 51.03 -0.16 -0.31 4,827,263
VZ Verizon Communications Inc. 47.99 -0.22 -0.46 6,129,240
WDAY Workday Inc. 87.91 -0.63 -0.71 318,441


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