Cloud Migration Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Cloud Migration Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The cloud migration market was expected to register a CAGR of 28.89% over the forecast period 2022 - 2027. Over the past decade, cloud computing adoption has risen owing to increasing investments from small and medium enterprises. Globally, many organizations have already switched to cloud platforms to take advantage of its benefits. In recent years, cloud adoption stands to be a significant consideration for IT cost reduction strategies.

Key Highlights

• The significant reasons for migrating to the cloud are scalability, increased effectiveness, faster implementation, mobility, and disaster recovery. Considerable companies are offering cloud disaster recovery features to their customers, aiding them in expanding their businesses. Cloud migration is gaining traction for its real-time experience, business elements, and accessibility to on-premise data. This technology also aids in setting up several business units in minimal time.
• The growth of cloud and industrialized services and the decline of traditional data center outsourcing (DCO) indicate a massive shift toward hybrid infrastructure services. While the conventional DCO market is shrinking, spending on colocation and hosting, along with infrastructure utility services, is increasing rapidly. This is expected to drive the shift toward cloud IaaS and hosting. Migration for PaaS, IaaS, and SaaS has been most important in recent years. Companies are also embracing DevOps capabilities and automation; hence, they are increasingly seen as critical to realizing cloud adoption's technical and business benefits.
• The growing demand for cloud migration services is attributed to increased scalability, flexibility, remote collaboration, task automation, improved mobility, and robust data protection. Furthermore, the growing network of connected devices has resulted in massive data growth. As a result, the growing need for a low-cost data storage solution is projected to increase the use of cloud migration services.
• The migration to the hybrid cloud has experienced significant overall growth in the past few years compared to other cloud services. Using a hybrid cloud allows companies to scale computing resources and helps eliminate the need for massive capital to handle short-term spikes in demand. Many cloud providers offer the ability to rapidly increase infrastructure in various worldwide locations, enabling a business to expand to new territories quickly.
• Data security issues and application interoperability issues are expected to hamper the growth of the cloud migration market. Increased internet connectivity and digitization provide opportunities to the cloud migration service offering companies.
• However, the ongoing outbreak of COVID-19 across the world has created massive restrictions on businesses operating with on-premise IT systems. Hence, many of these organizations have rapidly migrated to the cloud. The increase in remote working during the pandemic peopled the cloud migration market.

Key Market TrendsBFSI is Expected to Witness Significant Growth

• Banking and Financial organizations are also accelerating the migration toward cloud solutions owing to the benefits such as flexibility, agility, and integration of emerging technologies and the FinTech ecosystems. Cloud solutions are helping banks to cut down expenses by slashing infrastructure costs significantly. Many vendors are providing IaaS and PaaS applications to eliminate the need to manage, host, maintain, update, and scale service operations targeted toward the BFSI sectors. Banks widely recognize that a cloud infrastructure can help them pursue sweeping modernization initiatives, including operational and customer-facing programs supported by AI, blockchain, and software containers.
• Banks are also adopting Cloud migration technology through strategic partnerships with cloud service-providing companies. For instance, in September 2021, IBM announced a new collaboration with CaixaBank, one of Europe's major banks, and opened a new IBM Cloud Multizone Area (MZR) in Spain to serve clients throughout the region as they implement hybrid cloud strategies. CaixaBank will be able to reaffirm its creative strategy by updating its key applications and enhancing efficiency via greater availability and resiliency.
• Furthermore, In May 2022, Jefferies Financial Group Inc. is partnering with Amazon to move its information-technology services to the cloud. This is the latest step by a financial business that has just begun to grow into cloud-based software and data analytics. Jefferies is transferring its essential business processes, internal and customer-facing apps, IT resources, and data to Amazon Web Services under a four-year arrangement.
• To provide a digital banking experience to customers, banking organizations are adopting cloud migration technology. For instance, in May 2021, Amazon Web Services (AWS) announced that the Union Bank of the Philippines would transition its IT infrastructure from on-premises to the cloud by 2022. The move is designed to speed the bank's digital transformation, improve customers' digital banking experiences, and increase financial inclusion in the Philippines by providing financial services to distant areas of the nation.

North America is Expected to Hold Major Share

• Regarding cloud migration, North America is among the leading innovators and pioneers and holds a significant share in the market. The region also has a strong foothold on cloud migration vendors, which adds to its growth. Some companies include IBM Corporation, Microsoft Corporation, Amazon Web Services Inc., Cisco Systems Inc., Cognizant Technology Solutions Corporation, and Google Inc.
• The benefits offered by moving data, and applications, among others, to the cloud, are pushing many organizations in the region to adopt cloud migration services, thereby impacting the market's growth positively, and also the companies in the North American region are making strategic collaborations, business expansion to propel the cloud migration.
• In December 2021, Nasdaq announced a partnership with Amazon Web Services to transfer its North American capital market. This hybrid architecture would offer Nasdaq low-latency access to its on-premises systems to enable high-frequency trading capabilities and allow its customers access to cloud-based features such as virtual connection services, market analytics, and machine learning.
• Furthermore, In August 2022, Next Pathway Inc., the Automated Cloud Migration company in Toronto, announced a collaboration with Microsoft to accelerate the migration from legacy data warehouses and data lakes to Microsoft Azure. Shift Analyzer provides a comprehensive review of source legacy application workloads to review the code types and objects present. Shift Translator accelerates the translation, testing, and migration of complex workloads such as SQL, Stored Procedures, ETL pipelines/workflows, and various other code types. Furthermore, Next Pathway's technology can easily and efficiently transfer workloads from other cloud platforms and cloud data warehouses to Azure.
• According to a survey conducted by Google, in 2021, cloud workload adoption among enterprises in the financial services and banking industries was 54% in the United States. Among the reasons for cloud adoption is that technology may assist in meeting consumer requirements, improving operational resilience, and facilitating the development of new products.

Competitive Landscape

The cloud migration market is fragmented and consists of several major players. In terms of market share, few major players currently dominate the market. These major players with prominent shares in the market are focusing on expanding their customer base across foreign countries. These companies leverage strategic collaborative initiatives to increase their market shares and profitability.

• June 2022 - Ovhcloud, a leading global cloud provider, collaborates with Lenet, a well-known end-to-end IT service provider for enterprises in the United States. This collaboration will help businesses of all sizes migrate to the cloud cost-effectively, flexibly, and securely.

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• The market estimate (ME) sheet in Excel format
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