Market Trends: Consulting, Implementation and Management Services Complete the Cloud Sourcing Model

Organizations look to IT services providers to help them design, build and run cloud services. Providers with strong, demonstrable cloud skills and offerings are best-positioned to be the preferred providers for clients today and in the future.

• Standardized public, private and hybrid cloud services often fall short in meeting the specific needs of organizations using cloud services. Cloud-related consulting, implementation and management services help bridge the gap between the capabilities of standard cloud services and the specific needs of organizations.
• The high growth of cloud adoption, both public and private, will drive higher growth in cloud-related services, with annual growth of 4% to 12% (depending on the service) from 2012 through 2017, compared with IT spending growth of 2% to 4% in the period.
• The cloud services brokerage roles of aggregation, integration and customization are delivered as consulting, implementation and IT outsourcing services. Most traditional IT services providers are extending their IT services offerings to include cloud services brokerage capabilities.

• Sales managers should watch for cloud adoption indicators within existing client accounts and recognize these as opportunities for engagement and precursors to additional services opportunities in cloud-related consulting, implementation and management services.
• Offering managers should develop cloud-related service offerings that detail specific outcomes of cloud-related initiatives, including timelines, migration plans, integration strategies and performance outcomes. Detailed outcomes help mitigate the risks that clients experience related to cloud adoption.
• With brokerage as one of the most versatile and effective means of providing cloud services, offering managers must decide if and when they will compete in the cloud services brokerage market, and then make a full commitment to the endeavor. Half-hearted efforts will not succeed.

The term "cloud services" has many different meanings, connotations and implications. Most often, cloud services refer to cloud computing or IT capabilities being delivered as a service using cloud delivery models. Gartner defines cloud computing as a style of computing in which scalable and elastic IT-enabled capabilities are delivered as a service using Internet technologies. Examples of these "as a service" type offerings are software as a service (SaaS), platform as a service (PaaS) and infrastructure as a service (IaaS).

"Cloud services" is a term that is also often used to refer to traditional IT services applied to cloud scenarios. For example, cloud-related consulting, implementation and management services are sometimes referred to as cloud services. Likewise, cloud services brokerage, the act of delivering cloud services by third-party intermediaries, is also sometimes referred to as cloud services.

As organizations incorporate the use of cloud computing, standardized cloud services must be aligned with the specific business requirements of the organization subscribing to the cloud services. When organizations have specific and unique requirements, there will typically be a gap between the capabilities provided by a standard cloud service and the needs of the organization. Consulting, implementation and management services help bridge the gap between organizational needs and standard cloud services.

Most traditional IT services providers are actively promoting their cloud-related offerings, which are often a pairing of consulting, implementation and/or management services with specific cloud services. This coupling of services has been, and will continue to be, a mechanism for IT services providers to participate in the high-growth cloud services markets, leverage their existing skills and customer relationships, and remain relevant in the shifting landscape of IT services.

This Market Trends report highlights the market trend of combining cloud-related services with standard cloud services offerings.

The cloud services market is expanding at a rate almost five times greater than traditional IT spending. According to Gartner's latest forecast of IT spending and public cloud services, IT spending will grow at a compound annual growth rate (CAGR) of 3.6% from 2012 through 2017. During the same period, spending on public cloud services will grow at a CAGR of 17.1% (see Note 1). The accelerated growth rates in the public cloud services market are illustrative of the shift in IT spending from traditional IT systems redirected toward new cloud models.

The shift to cloud services will drive growth in other segments of the IT services market. This includes work done in both private cloud and public cloud implementations. While IT spending growth will range from roughly 2% to 4%, growth in cloud-impacted services markets will exceed both IT spending generally and IT services (excluding cloud services) specifically. The adoption of cloud services will drive market growth in specific IT services sectors, including consulting, implementation and management services (see Note 2).

During the period from 2013 through 2017, organizations will continue to embark upon new initiatives, such as IT transformation and application modernization projects designed to reduce costs and increase IT and business agility. Organizations will continue to seek out alternative IT delivery models specifically oriented around cloud services. IT initiatives will include investments in both private and public cloud and are expected to have a small, but positive, impact on IT spending directed toward consulting and implementation initiatives.

The effect of cloud services on the IT services marketplace is an increase in the growth and market opportunity for services related to cloud (both public and private). Figure 1 illustrates the high rates of growth for consulting, implementation and IT management services compared with growth in public cloud spending rates and IT spending overall. (Note that the growth in public cloud services is from a much smaller base.)

Cloud-Related IT Services Are Predicted to Grow Faster Than IT Spending Overall

Note: The IT Management Services category comprises hosting, colocation and infrastructure utility services in the IT services market taxonomy.
Source: Gartner (September 2013)

The cloud services value proposition is very clear in terms of the key attributes that end-user organizations should expect from authentic cloud services offerings. To confer the full benefits of cloud computing, cloud services offerings must deliver the following capabilities, or subscribers (to cloud services) will not recognize the full benefits of a true cloud services model:

1. Service-based – Subscribers, including end users and applications (through a programmatic interface), can subscribe to a service and provision services without any direct intervention from the provider.
2. Scalable and elastic – The service must scale on demand to add or remove resources as needed.
3. Shared – The services must share a pool of resources with other consumers. This is what gives cloud services real economies of scale.
4. Metered by use – Services must be tracked with usage metrics to enable multiple payment models, including pay-per-use.
5. Internet technologies – Services must be delivered using standard Internet technologies, formats and protocols. Another way to state this is that the services must be delivered using standard formats.

True cloud services offerings will incorporate IT management services. When cloud services are implemented by a provider and delivered to subscribers, the provider assumes responsibility for the ongoing management of the cloud service. This is not to say that providers have responsibility for managing all aspects of the use and consumption of the cloud service. Complementary management services can augment the offering and help connect cloud services to real use cases. For example, a cloud services provider may deliver cloud infrastructure services (IaaS). By delivering IaaS, the provider takes responsibility for all IT services management tasks related specifically to the implementation and delivery of the cloud service. This includes managing the data center, servers, storage systems and networks to fully implement and deliver the cloud service. Many providers also include some management, monitoring and reporting tools. Cloud-related consulting, implementation and management services can enable a more seamless consumption and usage of cloud services from an external service provider (ESP), as in the case of cloud services brokerage.

Once a subscriber – a user or a customer – has provisioned a cloud service, there will be many different use cases for the service. As subscribers move traditional workloads and applications to cloud infrastructure, they retain responsibility for the ongoing management and maintenance of the services running in the cloud environment, unless the traditional services are replaced by cloud services. Likewise, the integration, customization and aggregation, including ongoing management of the cloud environment, are all activities that are highly complementary to the cloud service, but are not cloud services in themselves, although cloud services may be used as part of the delivered service.

Because the cloud services market opportunity is so rich for providers, it is common for traditional service offerings to be positioned either as strong complements to real cloud services offerings, or as cloud services offerings themselves. Consumers should beware of so-called cloud services offerings that do not meet the standard of real cloud services. Organizations find value in cloud-related service offerings as demonstrated by growing demand; however, these cloud-related offerings should not be referred to as cloud services themselves, but rather cloud-related services.

Savvy providers recognize the value of the legacy IT services coupled with the new cloud-based models and are providing solutions that knit together IT environments incorporating traditional IT with private, public and hybrid cloud offerings. When an IT environment is a mix of traditional IT plus cloud services, we refer to this as hybrid IT. Organizations adopting a hybrid IT approach are developing – albeit with some difficulty – the skills necessary to appropriately work with the right ESPs in a multisourcing model, incorporating traditional IT, private clouds, public clouds and hybrid clouds as a technology foundation for delivering IT services to their organization. In the hybrid IT model, infrastructure and operations organizations become the trusted broker and provider of IT services, delivered dynamically from multiple sources (both internal and external) and through various styles of computing. Hybrid IT solutions incorporate the cloud services brokerage capabilities of integration, aggregation and customization across both traditional and cloud-based IT solutions, managed and governed to meet the enterprise IT requirements.

The cloud services marketplace will incorporate cloud services brokerage models, hybrid IT, the cloud "as a service" type offerings, and the associated consulting, implementation and management services to aid organizations in their adoption and ongoing use of cloud computing technologies. Service providers with strong competencies in traditional IT services are likely contenders to deliver hybrid IT solutions, but they will have to augment their current offerings with strong cloud implementation, management and cloud services brokerage capabilities.

Organizations are turning to cloud consulting services to help them in the establishment of their cloud strategies. Providers should develop cloud expertise to help clients assess their current environment for suitability in migrating applications, services and processes to cloud computing models. Cloud strategies that start with business outcomes, instead of technology outcomes, are more likely to succeed in meeting clients' expectations.

Cloud implementation services can be focused either on specific cloud strategies, or as a more generalized cloud-based architecture incorporating multiple cloud services offerings and public, private and hybrid cloud scenarios. Organizations are seeking implementation help in establishing cloud services that work for their specific environment. This often requires integration between different cloud services and between cloud offerings and traditional applications or data repositories. Customization services are also in demand to augment standard cloud services with the specific features or functionality required by a subscriber for the cloud service to meet the specific needs of the organization.

Cloud management services essentially come in two forms:

1. Cloud aggregation services, delivered as a cloud services brokerage service
2. Traditional IT services management, incorporating cloud services

Ongoing monitoring, management and delivery of cloud services into an organization will be required. Many organizations plan to establish capabilities in these areas as an extension of existing IT operations roles. When this happens, the IT operations organization becomes the cloud services broker and IT services provider for their organization. To establish these competencies, some IT organizations will want to work hand in hand with an external provider to develop these capabilities internally. Other organizations will look to ESPs to deliver all these capabilities without involvement from their own internal IT organization.

Providers operating in this market will have to develop or acquire the right competencies to deliver cloud-related consulting, implementation and management services. Although existing consulting practices can be extended to include cloud services, the requirements are different and require specific cloud-related skills.

Cloud computing has become one of the most hyped trends of the past several years and has drawn in both end-user organizations, which enthusiastically chase proposed cloud services benefits, and providers that want to ride the cloud hype wave to grow and remain relevant in a shifting IT landscape. Consequently, the marketplace has never been more crowded than today as providers of all types build on their current strengths and assets and attempt to position themselves as cloud services providers.

Traditional IT services providers – providers delivering IT consulting, implementation and management services – are well-suited to offer cloud-related services. This is particularly true if they have an established process of delivering repeatable services. Standard engagement practices backed by strong delivery capabilities can be applied to cloud computing scenarios if the service provider makes the right investments in training and skills within its organization to account for the unique requirements of cloud models versus traditional IT models. Service providers that don't make real investments in building cloud-related capabilities cause confusion and dissatisfaction with their clients. Inappropriately positioning traditional offerings as cloud services will inevitably fall short of delivering real cloud computing value to their clients.

While no two cloud-related consulting service offerings are the same, they all follow a similar pattern of engagement, with each step growing in cost, scope and client engagement. The stages of cloud-related consulting practices are shown in Figure 2.

The Typical Stages of Cloud-Related Service Engagement

Source: Gartner (September 2013)

1. Cloud workshop – This is typically an initial engagement between provider and end-user organizations and is usually presented as a workshop lasting one day or less to outline the benefits of adopting cloud services models. Workshops are often lead generation activities conducted for free by providers.
2. Cloud assessment – An on-site evaluation of an organization's existing environment is performed to determine the feasibility of moving certain workloads or processes to a cloud environment. Assessments are designed to create demand for follow-on engagements. During a typical assessment, the organization's application portfolio is examined to determine which applications may be well-suited for a migration to a cloud environment, either as a hosted application on an IaaS offering, or as a rewritten cloud application using cloud platform services, or PaaS.
3. Cloud strategy – Based on the current state of the organization plus the long-term desire to adopt cloud services, a cloud strategy is produced to outline a multiyear road map for transitioning all or some of an organization's traditional IT services to a cloud environment. The cloud strategy may serve as a blueprint for subsequent cloud services adoption, in addition to providing a statement of direction for internal (and sometimes external) interests.
4. Cloud design – Building on the previous assessment and strategy work, a cloud design outlines an actual plan for implementing cloud services, and/or migrating existing applications or processes to a cloud environment. When done correctly, the cloud design will account for the impact to existing business processes and the integration challenges of introducing a new external service to the organization, in addition to the migration to a cloud environment.
5. Cloud implementation – Exercising the design plan, cloud implementation projects take current or new processes and workloads and implement these using cloud models. Implementation projects often include IT optimization initiatives and application modernization. The cloud services brokerage roles of integration and customization are included in the implementation stage. Descriptions such as "IT transformation," "application modernization," and "cloud migration" are also used to describe cloud implementation initiatives. These projects can be extensive in scope and may happen over a period of many months or longer. Many organizations will also incorporate a pilot program during implementation to test the design and implementation plan.
6. Managed cloud services – Once an implementation using cloud models has been completed, many providers offer management services to continue their involvement with the organization to actually run and manage the new environment. These engagements look more like more-traditional managed services, with the incorporation of new cloud models. The management of a complex cloud environment may also include aspects of cloud services brokerage, where the cloud management provider performs the role of aggregator, integrator and/or customizer in delivering cloud services. Integrated support services are often included as part of cloud management services.

Beyond the stages of cloud services consulting and IT management services, there are many possibilities for follow-on projects to continue to build on and enhance the cloud services environment. The incorporation of additional cloud services through the cloud services brokerage model plus ongoing application development are likely activities.

Like any professional services engagement, each stage in the cycle produces new opportunities growing out of existing opportunities. Cloud services engagements may not necessarily include all stages outlined above, particularly when organizations want to pick up the work and complete the process themselves. This will often be the case when the client is trying to establish the necessary knowledge and skills to manage the environment once the move to cloud services is complete. In a recent Gartner survey, we found that organizations have a strong preference to have their internal IT resources involved in ongoing management of cloud environments, even when ESPs are used.

Service providers differ in their approaches to defining engagement processes and their willingness or unwillingness to work alongside their clients during each of the engagement stages. With cloud services particularly, organizations prefer providers that are flexible in meeting their needs and in equipping them for future success once the engagement is completed through training and skills transfer.

Cloud services offerings deliver the greatest value when the services meet the specific needs of organizations. The pairing of consulting, implementation and management services with cloud services offerings is often the best approach for ensuring standardized cloud services offering work with the specific requirements of an organization.

The Gartner cloud services taxonomy includes the following cloud services categories:

• Cloud system infrastructure services, or IaaS
• Cloud application infrastructure services, or PaaS
• Cloud application services, or SaaS
• Cloud business process services, or business process as a service (BPaaS)
• Cloud management and security services (delivered as SaaS solutions)
• Cloud services brokerage

In addition to these broad categories, there are many other examples of IT capabilities delivered as a service. Some examples include information as a service, unified communications as a service, desktop as a service, and security as a service. Suffice it to say that when IT capabilities are delivered using a cloud computing model, we consider them a cloud service regardless of the nomenclature used.

Across the continuum of cloud services offerings, there are strong providers in each category. Some providers operate exclusively within a single cloud services market category, while a few select providers offer capabilities that span multiple segments.

Cloud services are finding their way into organizations, sometimes through formal processes, and sometimes through rogue initiatives (see Note 3). Several factors drive the need for external providers to assist organizations in defining and implementing a cloud computing strategy.

First, while many enterprise IT organizations have established strong expertise in building and managing IT systems, cloud computing is an entirely new model. Most organizations don't have the necessary skills to take advantage of new cloud computing models. An understanding of the new cloud-related technologies and architectures is important, but business factors such as sourcing, provider management, SLA management, procurement, risk management and service delivery are also critical. The absence of these skills represents an opportunity for IT services providers to help their clients develop updated business strategies and develop the needed skills for them to incorporate the use of new cloud models in the implementation of the strategies.

Second, the proliferation of cloud services within an organization can be overwhelming to an IT organization that has been used to controlling IT purchases and deployments. Whenever organizations start to expand their use of cloud services, there will be a need to drive greater coordination and management across the organization to ensure reliable delivery of the services. Governance, security, compliance, monitoring, auditing and many other IT management functions are critical, and IT organizations will often seek to establish a coordinated approach to deal with the organizational integration and coordination challenges.

Third, cloud computing services do not generally replace all existing systems, and therefore, a need to manage hybrid IT scenarios quickly becomes a priority. This may take the form of disparate systems with loose sharing of data, or it may take the form of a fully integrated environment with common management and business processes across all systems, both traditional and cloud. Most organizations will trend toward integrated systems, requiring a comprehensive approach to the design, implementation and management of hybrid IT environments for providers aspiring to service this market.

In addition to the business- or technology-related benefits of cloud adoption, buyers are increasingly looking for external providers that will share the risks associated with cloud migration and adoption. Said another way, clients want someone who will "be on the hook" – financially speaking – as clients incorporate cloud technologies into their environment.

Many cloud services offerings include SLAs outlining the parameters of the operating cloud service. Providers offering cloud-related consulting, implementation and management services have the opportunity to incorporate a project-oriented approach to cloud adoption, complete with statements of work, well-defined milestones, and deliverables outlining specific cloud adoption timelines, data migration plans and performance metrics. When specific deliverables are included in cloud adoption projects, with detailed accountability by the providers, organizations feel more comfortable adopting cloud services. Furthermore, when providers demonstrate confidence in their service offerings by assuming some or all of the associated risks – through outcome-based commitments and pricing – organizations are more likely to move forward in cloud-related projects.

Over the next five years, cloud services growth will be dominated by North America and Western Europe. Although these are not the highest-growth markets, they comprise the largest markets for cloud services. For example, in 2013, North America will constitute 58% of spending on public cloud services, while Western Europe will represent another 23% of total spending. The five-year growth rates for North America and Western Europe (17.6% and 12.6%, respectively) are lower than most other regions, as exemplified by China (29.3%), Latin America (26.1%) and Emerging Asia/Pacific (33.8%). The large cloud services markets in North America and Western Europe make those regions critical for providers competing with cloud-related service offerings.

Additionally, the adoption of private cloud services has been more prominent in locations where there are already extensive data center resources. In the established markets of North America, Western Europe and Mature Asia/Pacific, many organizations have been more likely to pursue private cloud strategies. In the higher-growth regions, public cloud adoption rates have been higher. Gartner believes that the critical point where public cloud services will be considered will occur when organizations are faced with the decision to continue to extend their data center investments (through expansion, the refresh of hardware, or the renewal of software licenses) or move to the public cloud. The opportunity for service providers is richest when these decisions are being made. In other words, adoption of public or private cloud is directly associated with data center refresh or expansion decisions. Once a decision is made to consider public or private cloud solutions, opportunities grow for consulting, implementation and management services.

With all the virtues that cloud services can bring to an organization, the fact is that the cloud computing model is based on shared services delivered at scale. This means standardization.

While standardization can help drive down operating costs (for both providers and subscribers), it can also leave organizations in a deficit regarding specific functions or capabilities that may be required to fully support business needs. As specific business requirements increase and as the inflexibility of standard cloud services continues, the gap between the business requirements and the cloud services capabilities grows (see Figure 3). Subscribers look to cloud-related implementation and management services to address the feature or operational deficiencies.

Complex Business Requirements and Inflexible Cloud Services Create Demand for Cloud-Related Services

Source: Gartner (September 2013)

Several strategies help in the delivery of cloud services to an organization.

First, the new, standardized cloud services offerings need to be deployed in a way that maximizes the effectiveness of the standardized offering for an organization.

Second, there are opportunities to enhance standardized offerings through customization, typically through the development of specific modules that can be added to the cloud operating environment. This is common, and will become more common, on platforms where there are strong SaaS offerings delivered on a platform with rich PaaS capabilities. For example, salesforce.com is well-supported by the PaaS platform Force.com. Likewise, Windows Azure and Google AppEngine are examples of PaaS offerings that can be used to augment SaaS services.

Third, custom configurations can help orient standardized cloud offerings to an organization's specific design requirements.

Fourth, integration of cloud services with other cloud services or with traditional IT systems can fill in some of the technology gaps of a single, stand-alone cloud offering. Integration can be complicated, presenting an opportunity for cloud-related consulting services to knit together multiple systems (both cloud and noncloud) to create a complete solution.

As cloud technologies mature, subscribers will find more-sophisticated capabilities and more configuration options, which will help organizations "tune" the offerings for their specific needs. This is already the case with some IaaS offerings, in which subscribers can define and select compute resources that have different features and capabilities. Also, some SaaS offerings are demonstrating more-advanced configuration options.

Over time, Gartner believes that most organizations will recognize the benefits of standardizing some IT requirements and being more adaptable to standard cloud services. Likewise, cloud services will become more flexible in their ability to adapt to specific business needs. As this happens, the need for associated cloud-related services will diminish (see Figure 4). However, in the near term, the need is acute and demand is high for cloud-related services.

Adaptable Business Requirements and Flexible Cloud Services Reduce the Need for Cloud-Related Services

Source: Gartner (September 2013)

It's important to acknowledge that cloud services are not ideally suited to every use case. While the hype surrounding cloud computing might suggest that cloud services will ultimately replace all traditional IT services, the reality is that standardized cloud services will address an important part of the market but not solve every IT problem.

Most segments of the cloud services marketplace are still in the period of expansion. As is always the case as markets develop, expansion will be followed by a period of consolidation as prices drop and margins erode. The expansion of new cloud services offerings across all cloud services types (IaaS, PaaS, SaaS, and so on) means that the market is flooded with many different technologies. Although there have been some efforts to drive standardization in cloud services offerings (for example, the OpenStack Foundation and the Cloud Security Alliance), the landscape of cloud services is still cluttered with incompatibilities.

Cloud-related consulting and implementation providers can help their clients deal with many of these issues and help them identify the right cloud platforms for their specific needs. Additionally, as the cloud services marketplace continues to evolve, these providers can help clients to track the features of the different cloud services offerings and deal with ongoing interoperability challenges.

The cloud services market is in its infancy. Cloud services offerings today are delivered as highly standardized services, which then must be integrated into specific (custom) business environments. The likelihood is that over time, cloud services offerings will mature and become more sophisticated in their ability to adapt to the specific needs of subscribers. Rich customization capabilities through configuration or self-service customization tools will enable even highly standardized offerings to conform to the specific needs of organizations. API interoperability will improve substantially, enabling greater portability between cloud services offerings and creating a true plug-and-play experience that obviates the need for integration.

Integration capabilities will become standard features of cloud services offerings, enabling integration with organizations' applications and data, both cloud and noncloud. Integration toolkits will enable the connection of cloud services with other services and platforms – mobile platforms in particular.

Cloud-related consulting and assessment capabilities and tools will be added to cloud services offerings through self-service interfaces enabling organizations to do much of the cloud adoption prework through cloud services themselves. These "jump-start" services will complement an increasing cloud-oriented skill set within organizations and diminish some of the cloud-related consulting needed in the current market climate.

Another key factor in the broader cloud-related service market will be a standardization effect within organizations themselves. This will be characterized by a move from proprietary and closed enterprise IT architectures toward open and flexible architectures. Organizations will increasingly trend toward industry standards and best practices, focusing on their core business differentiation and generally evolving to use more standardized IT services. This will be manifest through the use of common services, including cloud services, which support multiple organizations. As organizations move to this model, there will be decreasing demand for services outside of the standard cloud services offerings. Where there are specific needs, organizations will consider these core to the business and will not outsource the implementation or management of these services to external third parties.

The challenge for organizations will be to strike the right balance between adopting standardized services and preserving the unique value they derive from their IT investments.

Cloud-related consulting and professional services are being offered today by service providers with a heritage of consulting and system integration. Many of these providers feel it's their birthright to deliver the new cloud-related services to their clients. However, these providers face the same challenges as organizations in trying to adapt their business models and service offerings to the new cloud models.

These providers include Accenture, IBM Global Services, HP Enterprise Services, Dell Services, Capgemini, Deloitte, Unisys and many others.

Other providers are using the market disruption caused by cloud computing as an opportunity to gain a foothold in new markets. They approach the market with targeted offerings, supported by development and deployment capabilities often hosted offshore (in India primarily). Their approach is to challenge incumbent providers – usually system integration companies – with focused cloud-related services, supported by offshore or nearshore cloud development and delivery centers. Some offer branded cloud services offerings. Most work with mainstream, market-leading cloud services and provide the associated consulting, implementation and management services.

These providers include Cognizant, Tata Consultancy Services, Wipro, HCL Technologies, Infosys, NTT Data, 2nd Watch, GlassHouse and others.

New providers are also entering the market and addressing some of the new requirements of cloud services implementation, particularly in the areas of cloud services brokerage. These providers primarily offer consulting and implementation services with a focus on integration of SaaS applications with other cloud services or with traditional IT systems. These providers include Appirio, Cloud Sherpas, Parallels, Jamcracker, Zimory and many others.

The common factor across all these providers is the need to develop the right set of skills, packaged in cloud-friendly offerings, and targeted at the right opportunities in the market. In some cases, the need is driven by demands of existing customers. The providers must either demonstrate cloud-related competencies, or the customers quickly move on to new providers with a track record of delivering cloud solutions.

Gartner forecasts market growth, published as the IT spending forecasts. Data from the IT services forecast and the public cloud services forecast were used in this report.

In 2012, Gartner conducted end-user surveys to learn about the relationship between IT spending and cloud services adoption. We also learned about the intended use of external providers to deliver cloud-related services. For details, refer to the following research documents:

• "Survey Analysis: Providers of IT and Cloud-Based Services Must Focus on the Details to Satisfy Customer Demands"
• "User Survey Analysis: How Public Cloud Strategies Impact Established IT Services Spending"
• "User Survey Analysis: What Providers Need to Know About First-Time Cloud-Based Services Buyers, 2012"

Gartner conducted interviews with 15 specific providers regarding their cloud-related service offerings, including their observations of the current and future market trends. These interviews were conducted from April to June 2013.