Gartner, the World’s top IT market analysis firm, has revised downwards its predictions for the adoption of cloud-based email and collaboration services – considered one of the ‘low hanging fruits’ for the Cloud market.
The firm said companies have not moved to the Cloud for email and collaboration services (such as messaging, document-creation, sharing etc.) as it expected at first.
As a result, the 10% adoption milestone, predicted for the end of next year has now been pushed back to the end of 2014. It now believes that cloud based email and collaboration tools (such as Gmail and Google Docs) will achieve 55% adoption among enterprises only by 2020.
“..most enterprises will not begin the move to CECS until 2014 when growth in the market will take off, before leveling off in 2020 as it exceeds 55 percent,” Gartner said.
It said that Cloud vendors had failed to sell their services as enablers, rather than as cost-cutting solutions, even as the actual services too have not lived up to customer expectations.
“The first [reason] is asset inertia. Organizations seek to extract maximum value from their investments in email and switching early can be like trading in a 2-year-old, low-mileage automobile.
“Secondly, senior IT managers are much more focused on strategic initiatives that help them to grow or transform their enterprise’s business and moving to cloud-based or SaaS email services is generally viewed as a cost-saving move rather than a strategic initiative.
“Finally, the practical realities of the vendors’ CECS offerings, when examined up close, are sometimes less compelling than the glossy stories they tell,” said Tom Austin, vice president and Gartner fellow.
It also noted that companies still remain nervous about putting their communication records on servers that are not physically located within their premises.
As a result, many Cloud-customers still “retain small, dedicated, on-premises systems to maintain greater control over the content created and consumed by C-level executives — whose communications are almost always subject to legal and regulatory scrutiny at semi-regular intervals.”
Some also believe that waiting around will give them a cost advantage, but it may not play out exactly as they expect, Gartner said.
“..cloud-based collaboration services appear to be forward priced and, while we do expect the cost of cloud-based email and collaboration services (CECS) to follow a cost-learning curve, the motive for much of the investment in CECS appears to be cost reduction.
“Thus, if CECS otherwise makes sense for an enterprise, it would be far better off proceeding now, while requiring that the CECS supplier guarantees to continue to reduce prices as prices in general fall in the market,” it said.
Gartner also said cloud-based collaboration will not be “the only model” as adoption will start to ‘plateau off’ at around 55%.