Cloud Computing – The Tipping Point.

Posted on Posted in AWS, Cloud Computing

In his best selling book, Malcom Gladwell described the ‘Tipping Point’ as the moment of critical mass or the boiling point. The major portion of the book was devoted to explaining the concept of how Ideas & Products spread like viruses do.

I would be using the same analogy for Public Cloud computing (IaaS / PaaS) & would make a point for the ‘Tipping Point’ moment started in the mid of 2014 & lasted till the first quarter of 2015. To put it in simple terms the Product in question (Public Cloud Platforms) reached a critical mass and from here on their growth would be on an unprecedented scale, making it difficult to predict any numbers.

The figure below (made to a rough scale) gives a good representation of the growth of this segment and it fits fairly well into the Tipping point analogy.


This chart from ‘Statista’ gives the actual dollar revenues for the IaaS servers from 2010 to 2106



& this charts taken from ‘The New Platform’ showcases the AWS revenue stream from 2009 onwards.



All these charts clearly indicate that the segment is growing at an admirable rate & that there 2014 was a Tipping  point as far as the future course is concerned.


In one of their reports Gartner predicted that the revenue for compute IaaS and PaaS will exceed $55 billion by 2020 and likely pass the revenue for servers. My sense is  that this number would be definitely be reached, probably a bit ahead of time.


The major drivers for current and the future growth would be the following, these factors are of-course up and above the core drivers existing drivers

  1. Large Enterprises finally jumping onto the public cloud bandwagon, after being fence sitters for a long time. The initial adaptors of the Public Cloud were Small Businesses & these were followed by Medium Scale businesses, but for a long time the large enterprises shied away from moving any production workloads to the public clouds on account of security concerns, vendor lock-in concerns, long term pricing concerns etc. But this mindset has seen a tectonic shift and there has been exponential increase in the rate of adoption of Public Cloud by Enterprises in the last 18 months. This shift in the thought process has led more and more enterprises have started to move some of their workloads to the public cloud. Almost every large organisation is now thinking of a hybrid cloud, hybrid multi-cloud strategy .
  2. Success stories & proven use cases of companies like Netflix, Airbnb, Dropbox, Spotify etc that have succeeded big time in running large scale operations on the cloud without compromising their security.
  3. The success stories of Uber, Snap Chat & Pokémon Go that grew so fast that the traditional infrastructure provisioning models fail to cope up & scale out with the desired velocity.
  4. Maturing of the tools & processes around the cloud eco-system, especially when it comes to
    1. migrating workloads to the cloud with minimum cost & disruption to existing services.
    2. spreading the workloads across various public cloud vendors seamlessly & avoiding specific cloud service provider lock-ins.
  5. The rise of Docker and its eco-system; today every player in the market is trying to move on to docker to get rid of their technical debts and move to a micro services based architecture. The major cloud services providers were quick to seize the opportunity & have already invested a lot of efforts / resources in making their platforms compatible & ready to be dockerized. Today both AWS & Azure have native versions of docker containers and docker orchestration (in beta stages) available for use. GCP is tightly aligned with kubernetes, which is equally good at orchestrating containers.
  6. The evolution/consolidation of the cloud platforms & the expansion of their services portfolio. Every 3 months there is a new service being offered, covering parts of the product development lifecycle that were untouched earlier. So today i can run an entire CI/CD pipeline, get End User workstations, run tests for Apps, run managed No Sql databases & do real time analytics of IoT steam feed from one console.
  7. Economies of Scale that the cloud service providers have achieved as they keep on adding compute power to cater to the every increasing customer base. This enables the cloud service providers to pass on the price benefits to the consumers in effect making the deal sweeter & the decision to move to the cloud easier. The chart below showcases the reduction in the compute prices since 2008 & the impact of these cost reduction would become even more prominent as the consumer base grows. j33hw-o-jpg

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