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Australian Firms Embrace Hybrid Clouds for Transformation

Australian Firms Embrace Hybrid Clouds for Transformation

New business and technology requirements are boosting demand for public and private cloud services from both local and global providers, ISG Provider Lens™ report says

National and global trends are accelerating Australian adoption of hybrid cloud services, according to a new research report published by Information Services Group (ISG), a leading global technology research and advisory firm.

“While foreign players are well represented, local providers remain incredibly important.”

The 2023 ISG Provider Lens™ Private/Hybrid Cloud — Data Center Services report for Australia finds the use of both public and private clouds is growing in Australia as enterprises seek stronger security, more agility and lower costs.

“Australian companies are investing in every type of cloud to further their digital transformations,” said Ben Rossiter, ISG technology modernization lead in Australia. “Cloud infrastructure and services enable scalability, flexibility and ultimately better customer experience.”

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Many enterprises in Australia are choosing hybrid clouds to achieve the ideal mix of public and private cloud benefits, which vary based on each organization’s culture and business requirements. A few major factors are driving many cloud strategies across industries in Australia, ISG says.

One factor is that enterprises are investing in more data center resources to optimize AI and ML applications, which play a growing role in their operations, the report says. Data centers in Australia are quickly evolving to provide the scale and sustainability these applications require. Edge computing and IoT applications are also growing, though more slowly than expected, with asset-rich industries such as mining and utilities leading the way. By reducing network latency and enabling real-time data processing, these technologies are improving business outcomes.

The change in Australia’s national government in 2022 brought new urgency to climate concerns, accelerating investments in sustainability, ISG says. Data centers are a major focus of these efforts, including transitions to even more green energy sources and management systems. Data center location and data sovereignty have grown more important since the pandemic, in line with Australian and global concerns about security, essential infrastructure and competitiveness, the report says.

The market for colocation services in Australia continues to grow as companies look for ways to meet the requirements of various enterprise data types, the report says. As in other regions, organizations look to colocation providers for capabilities around security, customization, compliance and other areas of expertise. Enterprises in Australia prefer colocation providers with data centers rated Tier III and above in at least three major cities, ISG says.

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“The overall market for data center services and solutions in Australia is highly competitive,” said Jan Erik Aase, partner and global leader, ISG Provider Lens Research. “While foreign players are well represented, local providers remain incredibly important.”

The report also explores other trends affecting hybrid clouds in Australia, including a significant, ongoing skills shortage and the growing popularity of modular data centers.

The 2023 ISG Provider Lens™ Private/Hybrid Cloud — Data Center Services report for Australia evaluates the capabilities of 43 providers across three quadrants: Managed Services, Managed Hosting and Colocation Services.

The report names Fujitsu and Telstra as Leaders in all three quadrants. It names DXC Technology and Kyndryl as Leaders in two quadrants each. Accenture, CDC Data Centre, Datacom, Digital Realty, Equinix, HCLTech, Infosys, Macquarie Telecom, NEXTDC, NTT DATA, Optus, TCS, Vocus and Wipro are named as Leaders in one quadrant each.

In addition, Logicalis is named as a Rising Star — a company with a “promising portfolio” and “high future potential” by ISG’s definition — in one quadrant.

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