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Research: CIOs Up Spending On Containers, Microservices As Companies Increase Public Cloud Use

As containers have become more popular among enterprise IT leaders, Enterprise Research Technology said configuration, logging and monitoring tools could experience market share growth in the coming months.

As midmarket businesses move their storage and computing capabilities to the public cloud, more IT spending is shifting toward the tools and development methodologies that help companies benefit from cloud deployments: containers and microservices.

That's what Sagar Kadakia, head of data science at Enterprise Technology Research (ETR), told several IT leaders last week at The Channel Company's Midsize Enterprise Summit in San Antonio, Texas. Specialized, autonomous application services such as configuration management, orchestration, logging and monitoring tools are all receiving increased investment within a growing containers ecosystem, he said.

"Each piece is isolated, and each development team can sprint without having to worry about what's going on with another team or another service," Kadakia said. "You can put out releases significantly faster. That's why organizations are moving more toward this microservices architecture of late."

[Related: 4 Key Network Security Considerations For Midmarket Solution Providers]

Kadakia said ETR conducted a survey of about 3,700 CIOs, and from that group, the research firm pinpointed which CIOs were the first to adopt disruptive technology and the best at replacing technology that is fading into obsolescence. ETR then isolated responses from the roughly 200 IT leaders who best fit that profile and used them to gauge where progressive technology minds are spending more money year-over-year.

The ETR study indicated that managed hosting and cloud computing experienced the most increase in CIO interest from 2015-2016, particularly around the three top public cloud platforms – Microsoft Azure, Amazon Web Services and Google Cloud Platform.

From 2015 through the first half of 2017, however, ETR found that microservices experienced the largest jump in expected adoption and spend rates as businesses begin to move away from legacy on-prem applications. That conclusion remained true when the firm limited its data to midmarket and SMB respondents.

The market shift lines up with what ETR found to have taken place between 2016 and the spring of 2017: Docker achieved nearly 20 percent market share growth among Fortune 100 organizations and an estimated 5 percent rise among midsize and SMB companies.

"This is the impact that public cloud is having on the next gen of services and apps," Kadakia said. "It's not necessarily where all the spend is going. It's more so this is where the spend is shifting."

Docker, Azure and AWS were among three of the top four technologies adopted by these forward-thinking IT leaders, ETR found. Other tools and platforms to experience a rise within that segment of the technology landscape include a number of microservices, analytics platforms and next-generation security solutions, such as GitHub, Cylance and Elastic.

Among midmarket and SMB decision-makers polled, Azure maintained the highest market share (58 percent), followed by AWS (39 percent) and Google (32 percent). However, AWS was experiencing more growth than either Azure or Google based on a calculated net score of 58 percent (adoption and spending increase minus replacement and spending decrease).


When it comes to the movement towards specific microservices, ETR found midsize enterprise and SMB CIOs that favored Azure were investing most in configuration tools such as Chef, and logging platforms such as Elastic, as well as both Datadog and Wavefront for monitoring.

AWS users, on the other hand, were found to show the most interest in Ansible and Puppet Labs when it comes to configuration. However, Elastic, Datadog and Wavefront were all seeing significant growth among companies on Amazon's public cloud platform, as well.

’We’re using GitHub for our source control, Chef and Puppet to do the orchestration and automation, and Docker to spin up microservices. It used to take three months, but now we can have releases going every day," said the senior cloud infrastructure architect of a Fortune 500 enterprise, according to ETR.

Of course, the CIOs surveyed represent a small portion of the U.S. midsize and SMB markets. Not everyone is moving to the cloud just yet. Information Technology Cirector Bill Lindsey of Huntsville, Ala.-based Calista Corporation, said his company has kept a significant part of its workloads out of the cloud and, though it does have a presence on Azure, microservices are not currently on its radar.

"The majority of everything we do is on-prem. Still in the [storage area network] stage," Lindsey told CRN.

Kadakia insists that will change eventually, as the public cloud and containers disrupt traditional IT architectures; he predicts that "one-size-fits-all" legacy vendors would have a less prominent place in the IT landscape of tomorrow. Businesses, he said, need to curate infrastructure, microservices and tools to meet their unique needs and maintain the fast-pace needed to compete in the modern enterprise space.

"A lot of these monolithic vendors and large applications, they've become a liability," Kadakia said. "As people move to a microservices infrastructure, and they move in a very agile, autonomous way, it's hurting those who are sticking with their legacy architecture."

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