Market maturity will decrease security concerns related to cloud computing services
SAO PAULO — The Brazilian cloud computing market is becoming increasingly mature, as companies begin to realize the cost and flexibility benefits of adopting cloud computing solutions. Brazil’s slow economic growth has been compelling businesses to cut corners and focus on their core competencies. In this scenario, cloud computing could well be a priority once billing becomes usage-based and enterprises no longer have to incur heavy CAPEX on expanding capacity.
New analysis from Frost & Sullivan, Analysis of the Brazilian Cloud Computing Market, finds that the market earned revenues of $328.8 million in 2013 and estimates this to reach $1.11 billion in 2017. While there is already significant demand for infrastructure as a service (IaaS) and software as a service (SaaS), platform as a service (PaaS) is gradually rising to prominence with end users acknowledging its utility.
Cloud computing is rapidly gaining traction in Brazil due to its ability to turn capital expenditure (CAPEX) into operational expenditure (OPEX) and its provision of anywhere-anytime access to information. Additionally, it helps create a flexible environment wherein companies can increase or decrease the infrastructure according to their needs.
While companies see the value in cloud computing, they still have relevant concerns regarding the loss of data security when outsourcing. They also worry about the availability and continuity of connectivity services in Brazil that could prevent them from accessing the information when needed.
“Owing to the lack of awareness, companies are reluctant to give third parties access to their information, especially after the news of data espionage in the United States broke,” said Frost & Sullivan ICT Industry Analyst Guilherme Campos.
So far, cloud computing is still a nascent market in Brazil but the concept has become clearer to enterprises. The small- and medium-sized businesses are particularly gravitating toward IaaS services; there have been several instances of SMBs using IaaS services such as storage and backup to sustain their aggressive growth pace. Companies with e-commerce tools that have big differences in seasonality are also turning to these services to reduce costs.
“Telecom operators will have a stronger presence in cloud computing due to their offer of services such as billing, customer support, infrastructure and connectivity,” said Frost & Sullivan ICT Senior Industry Analyst Bruno Tasco. “Overall, the business model of cloud computing, together with mobility, is proving to be a winning combination in the Brazilian market.”