5G, SASE and remote work
The optimism driven by the economic recovery’s green shoots helped the US GDP grow at a high rate that pushed its size above the pre-pandemic levels of 2019.1 At the same time, the two leading public cloud providers exhibited extraordinary consistent and resilient growth. Amazon AWS earned $14.8B in Q2 ‘21 and grew by 37% compared to the same period last year. On its part, Microsoft Intelligent Business Cloud (which includes Azure) earned $14.6B in Q2 ’21 and grew by 50% compared to the same period the year before.2
The above record earnings and high growth highlight the unstoppable digital transformation trend. We will look briefly at three drivers of cloud transformation.
The pandemic and hybrid work
The pandemic has altered the IT culture and priorities forever. There is no turning away from the SaaS model back to the old licensing and maintenance of applications. The cloud’s economics of scale produce hard-to-beat business value and cost-effectiveness. Often overlooked is the business flexibility enabled by scalability of the cloud. It becomes almost impossible to justify the time-consuming and costly planning, acquisition, deployment, management and operating cycle of owned IT infrastructure.
The primary byproduct of the pandemic and cloud adoption is the hybrid work model that appears to be here indefinitely. This newly found hybrid model helps organizations optimize the value of talent regardless of where employees work. During the lockdown, employees worldwide discovered that they could be very productive working remotely. About 52% of employees prefer a flexible work model post-pandemic, while 11% favor remote work.3
Secure Access Service Edge (SASE)
The emerging SASE technology is a good indicator of the expected longevity of the distributed workforce. With the new technology, organizations can support branch offices and remote workers through cloud-based networking and security access services. SASE combines VPN and SD-WAN capabilities and cloud-native security, including zero-trust and firewalls. The fast-growing SASE is expected to be part of corporate IT strategies in 40% of enterprises by 2024. With that said, it is worth noting that SASE is located at the top of the “Peak of Inflated Expectations” on Gartner’s Hype Cycle for Cloud Security, 2020.4
SASE infuses agility into cloud networking and security as it dramatically reduces WAN traffic. It also enhances business continuity with centralized and virtualized networking and security services. SASE lowers operating costs as it reduces the need for some data movement. The new technology also enhances IT effectiveness by applying consistent security policies that strengthen mobile and remote security.
The 5G effect
The low latencies, faster transmission speeds and larger capacity will help the growth of IoT networks, carrier-edge data centers and private 5G networks. Customers will soon notice the faster transmission speeds as carriers upgrade and expand their 5G networks. In addition to quicker uploads and downloads, customers will benefit from 5G’s ability to split, or splice, the bandwidth and dedicate one range for calls and another for streaming video. The bandwidth splitting capability is very beneficial where many subscribers are streaming video without impacting the bandwidth range dedicated for phone calls or emergency numbers.
The 5G high transmission speeds will also enable carrier-edge cloud data centers at the bottom of transmission towers. The presence of nearby data centers will accelerate application response time and save users valuable time to be put towards higher productivity. It is worth noting 5G is also good at saving energy as it stops using power when no send or receive activity is detected.
5G networks will play a crucial role in enabling autonomous vehicles that need low latency and high speeds for real-time decisions. Along with factory floor deployments, industrial use of 5G requires efficient networks and vast cloud storage capacity with intelligent analytics that will contribute to the continuing adoption and expansion of the cloud.
The action is at the edge
It was only a few years ago when enterprises preached cloud-first and mobile-first strategies. Today that’s starting to fade as the edge takes center stage, thanks to the shift in data movement to edge-cloud centric patterns. More and more data born in the cloud and created at the edge facilitate the change in data patterns. Enterprises need to make the edge the focus of their cloud strategy, or at least, an equal entity to the corporate data centers. The rapid growth of IoT devices will only add urgency to the need for comprehensive edge initiatives that address performance, availability and protection for endpoints, data, applications and networks.
- The WSJ July 29, 2021. “The US Economy Prospect Looked bright, Until the Delta Variant Surged.”
- CNBC News July 27 and 29, 2021.
- McKinsey & company April 2021. “What employees are saying about the future of remote work.”
- Gartner August 2020. “Top Action From Gartner Hype Cycle for Cloud Security, 2020.”