The impact of the coronavirus outbreak on the cloud services

09.04.2020 1,154 2

Martin Deshev

Let’s be honest, the Covid-19 outbreak caught the world completely off-guard. A lot of countries went into lockdowns of various degrees. Billions of people have to stay home as much as they can. And many of them have to work from home. This put the cloud services in the center of the stage for many reasons.

Cloud services of all kinds recorded big jumps in usage. Microsoft for example announced there’s a 775% jump in the use of some of its cloud services like Teams in Italy. Some even say that the public cloud computing is an “unsung hero” in the crisis as none of the massive remote work opportunities now, wouldn’t have been possible 10 years ago.

The hero we need

The coronavirus outbreak put a lot of stress on the network infrastructure. Despite a few “wobbles”, it manages to handle the strain. Big streaming services also helped out by lowering the bitrates and resolutions of their videos. This allowed hundreds of millions of people worldwide to continue working from home and this is where the cloud stepped up big time.

A lot of the services we all need and use actually rely on the cloud. Think about those video conferencing services, collaborative tools, storage and so on. Unless they are held on a private network by your own employer or company, chances are they heavily rely on the public cloud providers. “Right now, everything is doom and gloom out there,” 2nd Watch Executive Vice President Jeff Aden told CRN. “But the majority of companies have been able to continue to operate because of the cloud.”

The company says there haven’t been any hiccups in cloud providers. They are all handling the increased loads and are able to keep providing their services to clients without issues. And this is a fact for smaller cloud providers, too. Many have seen the writing on the wall and have been preparing a few weeks in advance for the increased loads. Now it’s paying off by allowing them to continue to provide their services to clients. Nettera’s own Cloudware also continues to operate without a hitch.

Increased love for the cloud

If there’s a silver lining in the pandemic, it is that many businesses are now discovering the benefits of a digital strategy, digital transformation and remote work. All of this means that the cloud is poised to continue getting a lot more attention in the times ahead.

For example, Instinet did a quick survey to check out CIOs expectations for the IT budgets and investments during and after the Covid-19 outbreak. While the majority of CIOs expect spending cuts in the near-term, they also see increasing priorities for security and cloud services. In fact, 68% said cloud services will become a bigger priority for them, MarketWatch reported.

“The data suggests a pivot to cloud, and perhaps, more public cloud,” Instinet said. “CIOs expect to reduce their mix of on-prem workloads from 59% in 2019 to 35% in 2021… The data suggests a pivot to cloud, and perhaps, more public cloud. CIOs expect to reduce their mix of on-prem workloads from 59% in 2019 to 35% in 2021.”

Analysts from the Wall Street firm Wedbush also note that cloud stocks are among the best choices right now. “As we have seen in 20 years of covering tech stocks through many shock events, during the darkest period of a shock event with doomsday worries front and center, fundamentals and valuations get thrown out the window as pure fear and panic take over with red screens the result,” Dave Ives from Wedbush says, quoted by BusinessInsider.

As you can see, the old saying that there’s an opportunity in every crisis is still very valid. The coronavirus outbreak is going to be very damaging to a lot of industries. The cloud computing industry is not going to be among them. In fact, it has the potential to be the big winner out of all of this and even help other industries limit their damages and heal faster.