TBR: 60% of enterprises plan to increase spending on cloud services this year

Cloud becoming integral part of business strategy, says Forrester analyst
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A full 60 percent of enterprise decision makers plan to increase spending on cloud-based professional services this year, according to a survey of 1,300 IT decision makers by Technology Business Research (TBR).

In 2012, 66 percent of enterprise decision makers said they purchased cloud-based services, up from 59 percent in 2011. These figures suggest there is a significant opportunity for cloud vendors in the enterprise market.

"Cloud is no longer just an IT challenge, rather a strategic investment impacting company performance in a growing global competitive environment," commented TBR Senior Analyst Ramunas Svarcas.

Two of the biggest vendors in the enterprise cloud space are Microsoft (Nasdaq: MSFT) and Google (Nasdaq: GOOG). In a recent blog, Forrester analyst T. J. Keitt compared the two firms' cloud-based collaboration offerings: Microsoft Office 365 and Google Apps for Business. Keitt explained that both Microsoft and Google offer clients tools for the four collaboration workloads--email, teaming, real-time communications and social computing.

With Office 365, Microsoft is trying to maintain a balance between online services and on-premise software, which remains the software giant's bread and butter. Google, on the other hand, was born and raised on the Web, so its offerings are primarily Web-based applications.

"The choice for business and IT leaders looking at these two offerings then boils down to how these different views of collaboration technology align with the organization's collaboration (and broader business application) strategy," Keitt wrote.

Enterprises need to assess their employees' tolerance for change. Microsoft provides interfaces that employees have been working with for years, even though its collaboration products offer new ways of accessing functions.

Google challenges employees to work in different ways. Gmail and Google Drive serve as "catalysts for changes in how employees locate information, interact with colleagues and create documents," Keitt explained.

In terms of integration with on-premise applications, Microsoft does a better job by connecting its Business Connectivity Services in SharePoint to its online offerings. This caters to enterprises' desire to use their existing investments in collaboration applications. Google Apps appeals more to enterprises willing to focus their integration efforts on linking Google Apps to other cloud services, the Forrester analyst explained.

Microsoft offers enterprises a way to approach the cloud in phases, combining multi-tenant cloud environments with dedicated and hybrid options. Google, by contrast, only delivers its services through a multi-tenant environment for business customers, although government clients can opt to isolate data in a government-certified data center, Keitt noted.

Google surpasses Microsoft in its broad ecosystem of online applications offered by third-party vendors such as Salesforce.com, Workday and Box. These vendors are able to integrate with Google Apps by creating application programming interfaces and through native integration that enables enterprises to transfer information between these services. Microsoft lags far behind Google in this area; most of Microsoft's offerings are based on its operating systems and browsers.

Based on Keitt's analysis, it would seem that the best approach for enterprises that are interested in transitioning to cloud gradually or that are in highly regulated industries such as the financial sector should deploy Office 365. Enterprises that are looking to embrace the cloud with both arms should go with Google because of the many additional services it can provide through third-party vendors. In order to choose wisely, enterprises need to understand their requirements thoroughly.

For more:
- check out TBR's data
- read Keitt's blog

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