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Flexera State of The Cloud Report 2024

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445 views76 pages

Flexera State of The Cloud Report 2024

Uploaded by

Gluck Zhang
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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FLEXERA™

2024 State of
the Cloud Report
AI experimentation outpaces usage;
SaaS and cloud costs high but improving
AWS and Azure continue to battle for dominance
2024 STATE OF THE CLOUD REPORT

Table of contents
Report highlights 4 Public cloud adoption continues
Organizations embrace multi-cloud 4 to accelerate 21
What challenges do you face in migrating What’s your current annual public cloud spend? 21
workloads to public cloud? 5 What’s your current annual SaaS spend? 22
Does your company have a FinOps team to advise, Non-SaaS software costs by vendor 23
manage or execute cloud cost optimization strategies? 5
Non-SaaS software purchase methods 24
What public cloud providers does
your organization use? 6 Do you track licenses for software
running in the cloud? 25
Use of generative AI (GenAI)
public cloud services 6 Workloads in public cloud 26
Cloud cost optimization and sustainability prioritization 6 Data in public cloud 27
What’s your approach for migrating
data to public cloud/SaaS? 28
Methodology 8 What challenges do you face in migrating
What size is your organization? 9 workloads to public cloud? 29
What’s your company’s industry? 10
Where are your headquarters located? 11 Cloud initiatives and metrics 30
What’s your role? 12 Which of the following initiatives are you planning
Where in the organization do you work? 13 to make progress on in the next year? 30
What’s your company’s usage level of public cloud? 14 Top cloud initiatives by cloud usage
for all organizations 31
What’s your involvement with cloud
in your organization? 15 What are your top metrics for assessing progress
against cloud goals? 32

Organizations are embracing


multi-cloud 16 Organizations are taking a
centralized approach to cloud 33
Organizations embrace multi-cloud 16
Does your company have a central
Hybrid cloud strategies 17 cloud team or CCOE? 33
Use of multi-cloud architectures by all organizations 18 Does your company have a FinOps team to advise,
Use of multi-cloud tools 19 manage or execute cloud cost optimization strategies? 34

Public vs. private cloud usage 20 Who in your organization leads cloud cost
management responsibilities? 35
Utilization of MSPs for managing public cloud
for all organizations 36
Enterprise vs. SMB MSP utilization for managing
public cloud 37

Top challenges are security,


spend and expertise 38
Top cloud challenges 38

© 2024 Flexera HELPFUL TIP: Click this icon for the Table of Contents 2
2024 STATE OF THE CLOUD REPORT

Table of contents (cont.)


Organizations struggle to control Private cloud plays an important role 58
growing cloud spend 39 Private cloud technologies used by all organizations 58
What’s your organizational spend on public cloud? 39 Enterprise private cloud technologies 59
What’s your estimated wasted cloud spend SMB private cloud technologies 60
on IaaS and PaaS? 40
Does your organization have a defined sustainability
What’s your estimated wasted software spend initiative that includes carbon footprint tracking
in the cloud? 41 of cloud use? 61
Which provider discounts do you use? 42 Cloud cost optimization and sustainability
What types of policies do you use to optimize prioritization 62
cloud costs? 43
Management of SaaS and software costs
compared to IaaS/PaaS costs 44 State of the Cloud Report:
Does your organization use a unit economics
European spotlight 63
model for cloud cost analysis? 45 European respondents by organization size 63
European respondents by industry 64
European respondents by country 65
Public cloud adoption is evolving 46
European respondents by role 66
What public cloud providers does
your organization use? 46 European respondents by where
in the organization they work 67
YoY public cloud provider adoption
rates for all organizations 47 European respondents by cloud usage level 68
Enterprise use of public cloud providers 48 European adoption of central cloud team or CCOE 69
YoY enterprise public cloud adoption 49 Cloud migration challenges for European organizations 70
SMB use of public cloud providers 49 Cloud initiatives for European organizations 71
YoY SMB public cloud adoption 50 Public cloud provider adoption rates for European
organizations 72
How much do you spend on each cloud provider? 51
Enterprise public cloud spend 52 Does your company have a FinOps team to advise,
manage or execute cloud cost optimization strategies? 73
SMB public cloud spend 53
Does your organization have a defined sustainability
How many VMs do you have in each cloud provider? 54 initiative that includes carbon footprint tracking
of cloud use? 74
Utilization of MSPs for managing public cloud
Use of public cloud PaaS services is for European organizations 75
increasing 55
Public cloud services used for all organizations 55
Cloud initiatives move
Public cloud services used by enterprises 56
full speed ahead 76
Use of generative AI (GenAI) public cloud services 57
About Flexera 76

© 2024 Flexera HELPFUL TIP: Click this icon for the Table of Contents 3
2024 STATE OF THE CLOUD REPORT

The Flexera 2024 State of the Cloud Report sheds light on cloud computing trends and the
pressures facing IT professionals and the strategic initiatives they’re utilizing to remain
competitive in today’s dynamic and evolving landscape.

Report highlights
Here’s a sample of key findings from this year’s report based on a survey of 753 cloud decision-
makers and users from around the world.

© 2024 Flexera 4
2024 STATE OF THE CLOUD REPORT

© 2024 Flexera 5
2024 STATE OF THE CLOUD REPORT

© 2024 Flexera 6
2024 STATE OF THE CLOUD REPORT

In the face of ongoing economic uncertainties, many organizations are investing in


transformative initiatives such as generative AI (GenAI) and sustainability. At the same time,
managing costs effectively remains a top priority—and trying to find a balance between the
two is a formidable challenge. Despite this, cloud usage is on the rise, while wasted spend
is decreasing. Hybrid cloud strategies are evolving, with a notable increase in the number of
businesses adopting a more comprehensive view of cost management for hybrid deployments,
including the licensing of software used in the cloud.

Cloud spending remains substantial, as nearly half of all workloads and data are now in the
public cloud. For the second year in a row, managing cloud expenses has emerged as a more
pressing challenge than security, highlighting an intensified focus on FinOps practices and tools
for optimizing cloud costs and enhancing efficiency. This trend is consistent with the broader
adoption of multi-cloud strategies, the increased use of cloud services, and the establishment.
of cloud centers of excellence (CCOEs) in more than half of the organizations surveyed,
signifying a shift toward more centralized and strategic cloud management.

The Flexera 2024 State of the Cloud Report reveals:


• Organizations are embracing hybrid cloud
• Public cloud adoption continues to accelerate
• SaaS adoption is at an all-time high, as are SaaS governance
challenges such as cost management
• Organizations are taking a centralized approach to the cloud
• Top challenges are spend, security and expertise
• AWS and Azure continue to battle for the lead
• AI/ML has not yet taken flight, but experimentation is high
• When asked to prioritize cloud cost optimization and sustainability, companies
overwhelmingly prioritize cost optimization
• European spotlight

© 2024 Flexera 7
2024 STATE OF THE CLOUD REPORT

Methodology
The Flexera State of the Cloud survey tapped
753 technical professionals and executive leaders SMBs: Businesses with fewer
worldwide in the winter of 2023. The network than 1,000 employees
includes professionals across industries and
context areas. Enterprises: Organizations with
more than 1,000 employees
Flexera sources participants from an independent
Large enterprises:
panel that is rigorously maintained and is Organizations with more than
comprised of vetted respondents with detailed 10,000 employees
profiles. All numbers and percentages are rounded
to the nearest whole number.

At numerous points throughout the report,


we’ve provided our own interpretation of
the data as Flexera Points of View.

Reuse
We encourage the reuse of data, charts and text published in this report under the terms of
this Creative Commons Attribution 4.0 International License. You are free to share and make
commercial use of this work as long as you provide attribution to the Flexera 2024 State of the
Cloud Report as stipulated in the terms of the license.

© 2024 Flexera 8
2024 STATE OF THE CLOUD REPORT

This year’s survey leans toward enterprises, with 68% of respondents in organizations with
more than 2,000 employees. Eight percent have more than 100,000 employees.

© 2024 Flexera 9
2024 STATE OF THE CLOUD REPORT

Tech-related industries (35% between software, hosting/cloud provider/managed services)


and financial services (19%) lead respondents’ industries, followed by healthcare (12%).

© 2024 Flexera 10
2024 STATE OF THE CLOUD REPORT

Similar to last year, nearly two-thirds of the respondents are from the Americas (62% are
from the U.S.). Respondents from Europe made up 20% of the total, with the UK accounting
for 9% of that group.

© 2024 Flexera 11
2024 STATE OF THE CLOUD REPORT

The following figures indicate the breakdown of respondents by business role and where they
work within their organization. Twenty-one percent of respondents are cloud architects, and
8% report being in a FinOps role. There was a large gain in respondents who said they work in
central cloud teams (CCOE or similar), increasing to 50% this year from 35% last year.

© 2024 Flexera 12
2024 STATE OF THE CLOUD REPORT

There is a significant increase in organizations


creating and staffing a CCOE

© 2024 Flexera 13
2024 STATE OF THE CLOUD REPORT

Cloud adoption continues to become more mainstream. Heavy users now represent 71% of
respondents, up from 65% last year.

© 2024 Flexera 14
2024 STATE OF THE CLOUD REPORT

Most respondents have a significant influence on both IaaS/PaaS and SaaS, with a particular
increase in SaaS decision-making (84%) as well as usage and costs (74%). SaaS users also
increased from 63% to 70% year over year (YoY).

Users are increasingly gravitating toward the ease of use


and maintenance of SaaS offerings

© 2024 Flexera 15
Organizations are embracing multi-cloud

Most organizations have employed multi-cloud, with 89% of respondents reporting having
a multi-cloud strategy (a slight increase from 87% in 2023). Some respondents continue to
consolidate on a single cloud: 10% report a single public cloud this year, the same as 2023.

© 2024 Flexera 16
2024 STATE OF THE CLOUD REPORT

More than half (59%) of respondents use multiple public clouds. Fourteen percent use a single
public cloud.

A growing percentage of respondents use multiple public


and one private cloud (up from 19% to 23% YoY)

© 2024 Flexera 17
2024 STATE OF THE CLOUD REPORT

Apps siloed on different clouds and DR/failover between clouds remain the top two multi-cloud
implementations. Apps siloed on different clouds increased the most (up to 57% from 44% YoY).
Data integration between clouds increased to 45% from 37% YoY as organizations look for the
best fit for applications and data analysis.

FLEXERA POV
Organizations continue to factor in cost and performance prior to deploying workloads in the
cloud. Enterprises continue to find the best fit, often running applications in a single cloud,
which simplifies configuration, maintenance and security. A growing number of organizations
find use cases for data analysis in clouds separate from the one an application is running in.

© 2024 Flexera 18
2024 STATE OF THE CLOUD REPORT

Security tools remain in the top spot this year for all organizations, followed closely by cost
optimization (FinOps) tools and management tools. A higher percentage of large enterprises use
security tools (61%) and FinOps tools (57%).

© 2024 Flexera 19
2024 STATE OF THE CLOUD REPORT

Hybrid, public cloud only and private cloud only remained similar YoY.

FLEXERA POV
Similar YoY cloud usage indicates that organizations have achieved
a steady state; they’ve identified what works for them.

© 2024 Flexera 20
Public cloud adoption
continues to accelerate

Nearly a third of all respondents (29%) are currently spending more than $12 million a year in
public cloud, up from 24% in 2023. Thirty-six percent of enterprises spent more than $12 million
a year, up from 29% last year.

There’s a 21% increase YoY in organizations spending


$1 million or more per month on cloud

© 2024 Flexera 21
2024 STATE OF THE CLOUD REPORT

Nearly a quarter of respondents (22%) are currently spending more than $12 million per year on
SaaS. This increases to 26% for enterprises.

More than a quarter of respondents spend over $12M per year on


cloud (29%), and nearly a quarter (22%) spend that much on SaaS

© 2024 Flexera 22
2024 STATE OF THE CLOUD REPORT

For the first time, Flexera asked respondents for non-SaaS (cloud and on-premises) software
costs by vendor. Microsoft is by far the most common non-SaaS software vendor (49%).

© 2024 Flexera 23
2024 STATE OF THE CLOUD REPORT

In addition, the vast majority of non-SaaS software purchases are made directly from the
vendor (85%), with the primary vendor being Microsoft. These purchases are most likely
made under an existing enterprise agreement (EA).

© 2024 Flexera 24
2024 STATE OF THE CLOUD REPORT

It’s promising that 84% of respondents track software licenses in the cloud.

FLEXERA POV
Cloud costs are impacted significantly by software licenses. In some
instances, specific licenses can be more than quadruple the costs of the
cloud infrastructure on which the applications run. Organizations need
to not only factor in cloud costs, but consider the associated software
licensing costs as well.

© 2024 Flexera 25
2024 STATE OF THE CLOUD REPORT

For all respondents, 51% of workloads are in the public cloud today, with an additional
7% expected in the next twelve months. Half of all organizations have data in the public cloud
today, with an extra 7% expected in the next twelve months. Enterprises have more complex
environments but slightly lower usage rates, with 49% of workloads in public cloud and
48% of data in public cloud.

SMBs are the highest cloud adopters but fell off slightly from the previous year, with 61%
(a drop from 67% last year) of workloads and 60% of data in the public cloud for both years.

© 2024 Flexera 26
2024 STATE OF THE CLOUD REPORT

© 2024 Flexera 27
2024 STATE OF THE CLOUD REPORT

More than half of respondents said they’ll consider moving at least some consumer data or
corporate financial data to the cloud. Nineteen percent said all consumer data will move to
cloud/SaaS (up from 17% in 2023), and 18% said all corporate financial data will move to
cloud/SaaS (the same as in 2023).

More than one-third of respondents indicate all


nonsensitive data will move to the cloud and nearly
one-fifth say they will move all sensitive data to the cloud

© 2024 Flexera 28
2024 STATE OF THE CLOUD REPORT

Mapping all the relationships across apps, hardware and networking devices for each
IT-delivered service is notoriously difficult to do. Over half of respondents reported
understanding app dependencies (54%), assessing on-premises vs. cloud costs (46%) and
assessing technical feasibility (45%) as the top three cloud migration challenges.

Nearly half of respondents cite assessing


on-premises vs. cloud costs as a challenge

FLEXERA POV
A YoY analysis of sensitive consumer data shows a slight continuation of movement
away from on-premises toward cloud and SaaS, indicating organizations continue
to become more confident in the security controls that cloud provides.

© 2024 Flexera 29
Cloud initiatives and metrics

This is the eighth year in a row that optimizing the existing use of cloud (cost savings) is the
top initiative (increasing from 62% to 71% YoY). Notably, progressing on a cloud-first strategy
dropped to 48% from 55% YoY. Migrating more workloads to cloud increased from 44% to 58%
YoY. A high percentage of heavy cloud users (73%) see optimizing the existing use of the cloud
(cost savings) as a top initiative.

© 2024 Flexera 30
2024 STATE OF THE CLOUD REPORT

Optimizing existing use of cloud and migrating more workloads


to the cloud are the top initiatives, regardless of usage level

© 2024 Flexera 31
2024 STATE OF THE CLOUD REPORT

The top metric for measuring progress in the cloud has been cost efficiency/savings for the past
six years. This year, it has increased to 65% from 60% YoY. The number of workloads migrated to
the cloud has also increased YoY from 31% to 36%.

The continued prioritization of cost and workloads migrating to the


cloud emphasizes the importance of cost optimization and efficiency

© 2024 Flexera 32
Organizations are taking a
centralized approach to cloud

Most organizations (63%) have a CCOE or plan to create one within the next year (14%). Seventy
percent of large enterprises already have a CCOE, whereas only 29% of SMBs do. Fifteen percent
of enterprises expect to add a CCOE in the next twelve months, and 6% expect to add one
beyond that time. Just over a quarter (26%) of SMBs are planning to have a CCOE in the future.

More than half of organizations already have CCOEs; this


proportion could jump to more than 75% in years to come

© 2024 Flexera 33
2024 STATE OF THE CLOUD REPORT

Half of organizations (51%) have a FinOps team, and 20% are planning on creating one in the
coming year.

© 2024 Flexera 34
2024 STATE OF THE CLOUD REPORT

As usual, infrastructure and ops as well as CCOE or cloud teams lead the charge for cloud cost
management. Infrastructure and ops teams are most likely to govern cloud (IaaS/PaaS) usage/
costs (53%), optimize SaaS usage/costs (54%) and govern software licenses in IaaS/PaaS (50%).

FLEXERA POV
Even if software asset management (SAM) teams aren’t responsible for cloud and
SaaS costs, they need to ensure the responsible teams have the detailed licensing
information required to use those licenses effectively, remain compliant, minimize
risk and save the company money.

© 2024 Flexera 35
2024 STATE OF THE CLOUD REPORT

Fifty-three percent of all organizations are outsourcing at least some public cloud work,
including 26% that use managed service providers (MSPs) for most public cloud usage.

© 2024 Flexera 36
2024 STATE OF THE CLOUD REPORT

Fifty-six percent of enterprises are outsourcing at least some public cloud work. SMB usage of
MSPs has increased to 36% from 26% YoY.

© 2024 Flexera 37
Top challenges are security,
spend and expertise

For the second year in a row, managing cloud spend topped security as the top challenge facing
all organizations. This shift is likely due to organizations becoming more comfortable with cloud
security, while the increased use of cloud services leads to increased spend. Managing this
spend has become a priority for organizations. As in previous State of the Cloud findings, a lack
of resources and expertise continues to be a major challenge.

Managing cloud spend maintains its rank as the top


cloud challenge; last year this initiative dethroned
security, breaking an 11-year hold on the top spot

© 2024 Flexera 38
Organizations struggle to control
growing cloud spend

It’s easy to see why FinOps continues to evolve and grow as a cultural practice and financial
management discipline. Public cloud spend was over budget by an average of 15%.
Respondents remain bullish on cloud, as 31% expected their spend to increase in the next
twelve months.

© 2024 Flexera 39
2024 STATE OF THE CLOUD REPORT

Respondents reported their public cloud waste is 27%, similar to the 28% reported last year.

Estimated wasted cloud spend in IaaS and PaaS has been


trending down after reaching a high of 32% in 2022. FinOps best
practices are realizing financial benefits for many organizations

© 2024 Flexera 40
2024 STATE OF THE CLOUD REPORT

Software licenses can greatly impact the total cost of an application running in the cloud.
Respondents reported that wasted software spend in the public cloud was 24%.

© 2024 Flexera 41
2024 STATE OF THE CLOUD REPORT

Cloud provider pricing structures are complex and difficult to decipher, but provider discounts
offer opportunities to reduce costs. The majority of respondents are using either Azure EA
(Enterprise Agreement) discount (45%), AWS Reserved Instances (44%), IBM Cloud Subscriptions
(42%), Google Committed Use discount (42%) or Azure Reserved Instances (40%).

© 2024 Flexera 42
2024 STATE OF THE CLOUD REPORT

Automated policies such as utilization monitoring (56%) and those that shut down workloads
after hours (48%) are the most common ways to optimize cloud costs. Roughly a third of
respondents (35%) have automated policies in place to tag cloud resources, which is a
fundamental component of FinOps practices.

FLEXERA POV
Despite tags being critical to cost allocation and optimization, only 35% of
organizations currently use automated policies that implement required tags.

© 2024 Flexera 43
2024 STATE OF THE CLOUD REPORT

This year we asked survey respondents to weigh in on how they managed SaaS and software
costs. For the majority of organizations (57%), SaaS costs are tracked separately from IaaS
and PaaS costs.

FLEXERA POV
Many organizations struggle with finding the right bucket to put SaaS costs in, so these
costs are often in a category by themselves. As organizations begin to adopt new cost
management and optimization tools, these SaaS costs may be considered “cloud costs”
as the definition of cloud begins to envelop additional non-on-premises costs.

© 2024 Flexera 44
2024 STATE OF THE CLOUD REPORT

FinOps professionals often use unit economics as a key metric to gauge the efficiency of cloud
spend. Forty-three percent of respondents said they use unit economics as a key metric, up
from 39% last year.

FLEXERA POV
The 43% of respondents using unit economics as a key metric is good, but we
expect this percentage to increase as FinOps practices become more mainstream.

© 2024 Flexera 45
Public cloud adoption is evolving

Amazon Web Services (AWS) and Microsoft Azure continue to be the most widely used cloud
platforms. Specifically, 49% of respondents reported using AWS for significant workloads, while
45% reported using Azure and 21% reported using Google Cloud Platform. In contrast, usage
of Oracle Cloud Infrastructure, IBM and Alibaba Cloud remained relatively unchanged compared
to the previous year.

© 2024 Flexera 46
2024 STATE OF THE CLOUD REPORT

The top three cloud providers—AWS, Azure and Google Cloud Platform—each gained adoption
this year compared with last.

80% of all respondents now use Azure for at least some production
workloads. This is the first time in the history of the State of the Cloud
Report that a single cloud provider reached the 80% threshold

© 2024 Flexera 47
2024 STATE OF THE CLOUD REPORT

AWS and Azure are tied with 49% of enterprises running significant workloads. However, AWS
has a significant lead over other providers with SMBs (50% for AWS, 29% for Azure and 18% for
Google Cloud Platform).

The use of some public cloud providers increased YoY for SMBs. For example, 83% of
respondents report using AWS, up from 71% YoY. Azure is up to 67% from 51% YoY, and Google
Cloud Platform is up to 45% from 28% YoY. For the second year in a row, the highest percentage
of SMBs experimenting with a cloud provider are using Google Cloud Platform.

© 2024 Flexera 48
2024 STATE OF THE CLOUD REPORT

© 2024 Flexera 49
2024 STATE OF THE CLOUD REPORT

Azure’s ongoing rollout of competitive features, especially in


artificial intelligence (AI), could make it a more appealing choice
for small organizations aiming to boost their business growth

© 2024 Flexera 50
2024 STATE OF THE CLOUD REPORT

With all respondents, AWS and Azure are nearly tied across all spending tiers.

Although Google Cloud Platform adoption remains well behind that of AWS and Azure, it leads
with those spending less than $50K per month (24% for Google Cloud Platform, 20% for Azure
and 19% for AWS). This aligns with respondents experimenting with it (previously noted
at 17% for Google Cloud Platform, 9% for Azure and 8% for AWS).

© 2024 Flexera 51
2024 STATE OF THE CLOUD REPORT

Enterprises spending more than $1M a month continue


to increase adoption of AWS (up to 18% from 15% YoY)
and Azure (up to 19% from 15% YoY)

© 2024 Flexera 52
2024 STATE OF THE CLOUD REPORT

AWS (43%), Azure (46%) and Google Cloud Platform (42%) are near parity with SMBs that spend
less than $50,000 on public cloud. For SMBs that spend $50,000 or more on public cloud, AWS
holds the lead (42%) over Azure (28%).

© 2024 Flexera 53
2024 STATE OF THE CLOUD REPORT

The number of virtual machines (VMs) or instances running in each cloud provides additional
insight into the size of the organizational footprints within them. AWS and Azure lead among
the larger-footprint sizes of more than 500 instances. In the private cloud/on-premises space,
Microsoft offerings such as Microsoft Azure Stack and Microsoft System Center have more
large-footprint deployments than either AWS Outposts or Google Anthos.

© 2024 Flexera 54
Use of public cloud PaaS
offerings is increasing

In this year’s survey, nearly all PaaS offerings saw a gain in usage, with the largest being in data
warehouse (up to 65% from 56% YoY). Container-as-a-service (52%) and serverless (function-
as-a-service) (48%) are both up 9 percentage points this year. Machine learning/artificial
intelligence (AI) had a modest gain at 41%, up from 36% last year.

© 2024 Flexera 55
2024 STATE OF THE CLOUD REPORT

77% of enterprises are either currently using (44%) or experimenting


with (33%) AI/ML. Organizations are experimenting more
with AI/ML than with any other PaaS offering

FLEXERA POV
Although current AI/ML usage is only at 41% with all respondents, Flexera expects this
to increase significantly in the coming years as more and more organizations leverage
the emerging GenAI services offered by public cloud providers.

© 2024 Flexera 56
2024 STATE OF THE CLOUD REPORT

This year, we asked if respondents are using any public cloud provider’s GenAI services.
A quarter of respondents say they already use it extensively, 38% are experimenting and
22% use it sparingly.

Nearly half (47%) of respondents are using


GenAI cloud services in some form

© 2024 Flexera 57
Private cloud plays an important role

Most organizations are taking a multi-cloud, hybrid approach, in which private cloud plays an
essential role. Similar to last year, Microsoft Azure Stack ranks first with 38%. VMware vSphere/
vCenter climbed into the second spot with 36%, up from 28% YoY. Usage of all other private
cloud technologies has remained relatively flat, with OpenStack and bare-metal cloud usage
holding the final two spots as they have in prior years.

© 2024 Flexera 58
2024 STATE OF THE CLOUD REPORT

Azure Stack also continues to lead the way among enterprises (42% currently running
workloads). VMware vSphere/vCenter is second at 39%.

FLEXERA POV
Enterprises experimenting with (17% this year, 20% last year) or planning to use (10% this
year, 11% last year) vSphere/vCenter dropped. Despite some industry concerns about the
Broadcom acquisition of VMware, vSphere/vCenter saw its current usage increase. These
trends indicate there is still considerable momentum associated with VMware, and it will
take time for enterprises to move away from these offerings.

© 2024 Flexera 59
2024 STATE OF THE CLOUD REPORT

A quarter of SMBs currently run workloads in VMware vSphere/vCenter.

Among SMBs, vSphere/vCenter usage is higher than other private


cloud technologies, but the combination of those experimenting
with (7%) and planning to use it (2%) is the lowest

FLEXERA POV
SMBs are less likely to use VMware technologies, possibly due to perceived changes to the
channel after the Broadcom acquisition. As the State of the Cloud Report has demonstrated
year over year, SMBs are more likely to put workloads in the public cloud—and they are less
reliant on private cloud technologies.

© 2024 Flexera 60
2024 STATE OF THE CLOUD REPORT

Forty-eight percent of respondents say they already have defined sustainability initiatives,
including tracking the carbon footprint of cloud usage. When asked how sustainability
compares to cost optimization, 59% prioritized cost optimization.

© 2024 Flexera 61
2024 STATE OF THE CLOUD REPORT

59% prioritize cost optimization, while only 8% prioritize


both sustainability and reducing carbon footprint

FLEXERA POV
Although nearly half of all organizations have a defined sustainability initiative that
includes carbon footprint tracking of cloud use, only 8% prioritize it in terms of cloud
usage. On the other hand, 59% prioritize cost optimization, indicating that until
legislation is in place that penalizes organizations for carbon footprints—such as what
is currently being implemented in the European Union—prioritizing sustainability will
continue to take a back seat to overall cost optimization.

© 2024 Flexera 62
State of the Cloud Report:
European spotlight

The European distribution is very similar to that of the global respondent pool, with 33%
coming from organizations of more than 10,000 employees and 46% from organizations
with more than 5,000 employees.

© 2024 Flexera 63
2024 STATE OF THE CLOUD REPORT

The industries of European respondents also have a breakdown similar to that of the global
survey, heavily weighted toward financial services and technology. European respondents
worked at fewer healthcare organizations (4% compared to 12% globally).

© 2024 Flexera 64
2024 STATE OF THE CLOUD REPORT

As in years past, European respondents are mostly from the UK (44%), Germany (25%) and
France (11%).

© 2024 Flexera 65
2024 STATE OF THE CLOUD REPORT

The global and European data about roles is mostly consistent across respondent pools.
One exception is FinOps, where European respondents were at 3%, compared to 8% globally.

© 2024 Flexera 66
2024 STATE OF THE CLOUD REPORT

European respondents have more respondents working in a central IT/dev team (26% European
vs. 20% globally) but have very few working in FinOps teams (3% vs. 7% globally).

© 2024 Flexera 67
2024 STATE OF THE CLOUD REPORT

European cloud usage continues to increase, with 73% reporting heavy usage this year,
compared to 62% of European heavy users last year and 58% the year before that.

© 2024 Flexera 68
2024 STATE OF THE CLOUD REPORT

European respondents have similar numbers working in a central cloud team or CCOE. Over
two-thirds (68%) have a CCOE currently, and another 11% plan to have one in the next year.

© 2024 Flexera 69
2024 STATE OF THE CLOUD REPORT

Challenges in Europe are similar to those revealed in the global results. Understanding app
dependencies (50%) is the top challenge in Europe, followed by assessing technical feasibility
(47%) and assessing on-premises vs. cloud costs (46%).

Each year, these same three challenges claim the top spots
globally as well as for European respondents

© 2024 Flexera 70
2024 STATE OF THE CLOUD REPORT

European respondents are focused on cloud initiatives similar to those of their global
counterparts. In Europe, as with all respondents, the top initiative is optimizing existing use
of cloud (cost savings) (71%), followed by migrating more workloads to the cloud (61%) and
progressing on a cloud-first strategy (48%). European respondents have a slightly heavier focus
on moving from on-premises to SaaS offerings (44% compared to 39% globally).

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2024 STATE OF THE CLOUD REPORT

European respondents show a distinct trend in cloud adoption compared to the global
average, with a lower proportion using AWS and a higher inclination toward Azure. While 40%
of European respondents have significant workloads in AWS, this is lower than the nearly
half (49%) seen in the global respondent pool. On the other hand, Azure sees greater usage in
Europe, with 59% of European respondents running significant workloads on Azure, a notable
14% increase over the global figure of 45%.

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2024 STATE OF THE CLOUD REPORT

European organizations are less likely (45% compared to 51% globally) to have a FinOps
team in place, but they are more likely (24% compared to 20% globally) to implement one
in the next year.

FLEXERA POV
FinOps practices have seen more rapid implementation and maturation in the
Americas than in Europe, but survey results indicate European FinOps teams
are coming online rapidly.

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2024 STATE OF THE CLOUD REPORT

European organizations are more likely than their global counterparts (56% vs. 48%) to have
defined sustainability initiatives.

FLEXERA POV
As other parts of the world begin to adopt standards similar to the European
Sustainability Reporting Standards (ESRS), the global numbers for this
response will most likely increase.

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2024 STATE OF THE CLOUD REPORT

European respondents are less likely (48% vs. 53% globally) to use an MSP for managing at
least some of their cloud usage. They are also less likely (6% vs. 10% globally) to plan to use
an MSP in the future.

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Cloud initiatives move full speed ahead

Despite looming economic uncertainty in tech, the world continues to accelerate digital
transformation. The Flexera 2024 State of the Cloud Report highlights key insights surrounding
ways in which organizations are keeping costs down while tackling the complexities
of hybrid cloud computing, sustainability and new technologies such as GenAI.

NEXT STEPS

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© 2024 Flexera Software LLC. All other brand and product names mentioned herein
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