A global study of IT decision makers conducted by Aruba has found that there will be a significant shift to ‘as a service’ in the next two years as companies increase investments in cloud (32%) and AI based (30%) networking.
Half the decision makers in EMEA say they will explore new subscription models for hardware and/or software, 51% managed services for turnkey hardware/software and 29% financial leasing – all as a result of the impact of COVID-19. See report here:
The need for widespread but prudent investment is pushing decision makers towards new models of consumption, with subscriptions, managed services and financial leasing rising up the agenda, it finds. “At current levels, subscriptions represent barely a third of IT solutions consumed. Within the next two years they will be approaching a majority.”
Customer want more agile, automated infrastructures for hybrid work environments in the face of the current crisis. It examined the impact that the pandemic has had on projects and employees across EMEA and found that in the UK 71% of decision makers reported a significant or moderate impact to their employees.
Networking project cancellations were highest in Sweden (59%) and lowest in Italy (11%), showing there are also significant disparities between countries within the same region, while 37% in education and 35% in hotels and hospitality globally said they have had to cancel network investments.
“The emergence of the hybrid workplace is pushing IT leaders to deliver a delicate balance between flexibility, security and affordability at the edge,” said Morten Illum, EMEA Vice President for Aruba, a Hewlett Packard Enterprise company. “The workplace as we knew it has significantly changed and to support new norms such as social distancing and contactless experiences, campuses need to have the right technology in place to offer enterprise-level connectivity, security and support. All this must be done in an increasingly challenging financial environment which is spurring the trend for IT decision-makers to opt for the reduced risk and cost advantages offered by a subscription model.”
Organizations are also looking for more flexible financial models with 50% in EMEA looking to explore new subscription models for hardware and/or software, 51% managed services for turnkey hardware/software and 29% for financial leasing. In light of recent sector disruption, industries most likely to be considering the subscription model are hotels/hospitality (66%), IT, technology, and telecom (58%) and education (57%).
It found that 24% of decision makers currently estimate they consume at least half of their IT solutions ‘as a service’. Asked to estimate the likely situation in 12-24 months’ time, that proportion shot up to 41%.
In this timeframe, the average proportion of all IT solutions consumed via subscription is expected to increase by more than a third, from 34% to 46%. The trend towards network-as-a-service had already been established, but this research strongly suggests that it is now set to accelerate significantly as a result of the pandemic and the move to hybrid workplace
While five countries, including the US and India said a majority of solutions will be consumed ‘as-a-service’ on average within the next two years, subscriptions will reach average adoption levels of just 27% in Japan, 28% in Russia, 34% in Italy and Spain and 38% in Germany. The subscription model will grow worldwide, but its prevalence will become much greater in some countries than others, as the traditional CapEx model retains some market share in a handful of key developed markets, it says.
For more on the move to "everything-as-a-service", see the online XaaS summit next week where experts discuss the impact on markets, service providers' changing business models and sales techniques. Agenda and registrations here:
