2022 was a fascinating year for enterprise IT and the companies that deliver products and services to this market. Digital transformation was front and center for virtually every organization. And while in many cases resource constraints slow the completion of these projects, the urgency to drive to completion has increased due to competitive pressures. 2022 also saw many organizations refactor cloud consumption, with repatriation and service-specific multi-cloud adoption driving many benefits and introducing new challenges. Finally, 2022 was the year that many organizations realized how challenging it could be to operationalize edge environments, from data aggregation and analysis to the day-to-day monitoring and managing of operations and security.
So, what does this mean for 2023? Below are my five predictions for what we will see in this new year.
1. The cloud continues to diversify
The global public cloud market went through an exciting year in 2022. According to Statista, the market saw $490 billion in revenue, representing an annual 18.8% growth rate. And while many cloud companies recorded robust growth, well-positioned providers like Oracle have outpaced the industry. I believe the reason for this is quite simple: As enterprise IT organizations look to increase cloud usage for different functions, they prefer to work with vendors that already have a long track record with the workloads or service areas they want to move to the cloud. This dynamic is a big part of why Microsoft has seen so much success with Azure—it's a company whose products and services have populated the enterprise datacenter for decades.
That said, 2023 will see a continued diversification of the public cloud space, as customers choose vendors for specific functions and services. Further, growth will accelerate with Oracle's offerings in IaaS (Oracle Cloud Infrastructure, or OCI) and SaaS (led by Fusion, NetSuite, etc.). The company's name and brand are synonymous with data management, and it has a set of services in autonomous databases, along with the very popular HeatWave query-processing engine, that will make OCI a natural landing spot for many enterprise data management projects. And because it’s Oracle who has provided that data management platform for many businesses.
I am also keeping my eye on Couchbase as that company continues to grow in the NoSQL market and as its Capella DBaaS offering continues to gain popularity. While MongoDB is the more popular DBaaS engine, Couchbase has already proven to be a popular alternative for real-time applications and services requiring the lowest latency. This performance advantage will lead to Couchbase's continued growth in 2023.
2. Enterprise IT struggles to manage its data
No, my name is not Captain Obvious. Sure, data management has long been a challenge not just for enterprise IT, but also for the business users looking to use corporate data to glean insights that drive digital transformation. But—again at the risk of stating the obvious—there's a lot of data being generated. A lot. And data management specialists (database admins, analysts, data scientists, data engineers, and so on) are much too scarce, to the point that the skills gap within business units and across enterprise IT is vast. The higher education system cannot graduate trained and qualified professionals fast enough. And the younger professionals entering the workforce have not dealt with the complexity and diversity of an enterprise data environment. Indeed, this skills gap contributed to digital transformation projects that stalled out in 2022.
2023 will see enterprise IT organizations accelerate the adoption of cloud-based and consumption-based services to drive more efficient data management and ready-to-consume data analytics tools. Further, those cloud vendors that have a well-engaged consulting practice will enjoy a distinct advantage in delivering tailored and optimized solutions for specific customer requirements.
3. Enterprises grasp the value of consumption-based IT, accelerating adoption
Have you heard that GreenLake, TruScale, and APEX will change how IT buys and uses IT infrastructure? If not, have you been living under a rock? HPE, Lenovo, and Dell—the suppliers of the three services just mentioned—have been banging the consumption-based narrative since HPE's Antonio Neri made some very bold commitments back in 2019.
Fast forward to the start of 2023, and each company has seen a rapid increase in revenues associated with consumption-based IT. For example, HPE saw as-a-service revenues grow a staggering 68% from FY21 to FY22. And for its Q4 of 2022, its IaaS revenue grew 25% relative to Q4 of 2021.
2023 will see this trend continue—and expand—as enterprise IT organizations fully realize how such services can accelerate digital transformation. Specifically, I believe HPE GreenLake will see significant growth, given that it can leverage GreenLake with its Pointnext services to deliver point-and-click solutions to quickly enable AI, deep analytics, and other newer technologies for IT organizations that otherwise lack the expertise to stand up such solutions.
4. Hybrid multi-cloud becomes more than a cool thing to say
If there were a list of the top five overused terms for 2022, “hybrid multi-cloud” would be on it—perhaps at the top. Strangely, many companies claiming hybrid multi-cloud are all talk and no action.
With this said, there is a real need for enterprise IT to seamlessly (and affordably) move data and services from on-prem to off-prem and from cloud to cloud. And there's a real need for enterprise IT to monitor and manage its environment—regardless of where that environment is—from a “single pane of glass.” (I may be dating myself with this term.) Given the proliferation of development environments, database environments, workloads, and applications across the business, enterprise IT organizations are typically not staffed or equipped to manage the cloud-to-edge-to-datacenter environment.
That’s why the market has seen HCI leaders Nutanix and VMware position solutions around enabling the hybrid multi-cloud. VMware made a big splash in September with its Aria announcement and talk of multi-cloud services. And Nutanix has also quietly enabled such capabilities, offering native integration on both AWS and Azure through its Nutanix Cloud Clusters (NCC) offering.
My prediction is this: The increased adoption of cloud-native applications and the refactoring and re-architecting of applications associated with digital transformation will drive enterprise IT to adopt genuine hybrid multi-cloud environments. And this, in turn, will drive greater adoption of Nutanix with HPE GreenLake in enterprise IT.
5. The CPU market becomes even more interesting
The last few years have been the most dynamic I've ever witnessed in the CPU market. AMD has put Intel on its heels, and Arm has added a new layer of disruption and complexity to the market. AWS has Graviton, while OCI, Azure, and GCP have all announced support for Ampere-based offerings. How could it get any crazier? Oh, right, there's that whole Nvidia Grace announcement thing.
As we welcome 2023, I expect things to get even more interesting. First, while I don't believe that Intel's next-generation Xeon CPU (codenamed Sapphire Rapids) will deliver the richness of AMD's recently released EPYC CPU (codenamed Genoa), I do think it will go a long way in reestablishing trust with Intel’s customers at the same time it offers some workload-specific advantages.
Second, the Arm market will see a second supplier providing an even greater choice.
And third, I expect the hype around RISC-V to ratchet up in 2023. Ventana Micro Systems made quite a splash with its Veyron CPU family, and Tenstorrent just announced its RISC-V-based CPU—called Ascalon—targeting the AI market. Given the royalty-free nature of RISC-V, one must wonder if cloud providers and other hyperscalers with silicon design teams are exploring this architecture as an alternative.
6. Bonus: Security still keeps us up at night
OK, granted that this one seems like a no-brainer. 2022 saw enterprise IT organizations spend record amounts on cybersecurity—yet the threat landscape keeps getting scarier.
As ominous as this sounds, 2023 will be orders of magnitude worse. Hackers and cybercriminals will look for even more vulnerabilities as digital transformation projects and edge deployments continue to grow. On top of that, the geopolitical climate is ripe for nation-state disruption, perhaps including attacks on critical infrastructure and supply chains.
I am looking for 2023 to be the year when more enterprise IT organizations begin to take greater control over holistic cyber protections, rather than simply throwing money at point solutions running independently. This starts with deploying solutions from companies like CyberSaint that perform organization-wide security assessments.
While it's fun to write these prediction pieces, what’s really valuable is the process of writing them, because they help us think about what's really important. And while there will no doubt be some disagreements with the specifics in this article, hopefully there is some agreement on the direction of the higher-level predictions themselves.
Check back in December 2023, when I will do a year-end wrap up and try to find a way to validate every prediction I made. Meanwhile, have a prosperous, safe 2023.