Cloud takes hold in high-end outsourcing arena

More than a quarter of big-ticket deals now feature cloud component, with plenty more in the pipeline

Cloud is becoming increasingly prevalent in big-ticket outsourcing deals, research from Information Services Group (ISG) has found.

The percentage of large outsourcing deals tracked by ISG featuring a cloud component has trebled in the last two years, rising from nine per cent in 2010 to 27 per cent this year. In 2010 there were 110 such deals, rising last year to 220 and forecast to jump to about 300 this time out.

A quarter of the pipeline opportunities for the services providers ISG works with now feature cloud elements, and growth in this area is expected to outsource traditional business process functions, particularly in the US. The market watcher claims that software-as-a-service is the most widely adopted cloud technology, with infrastructure-as-a-service proving less popular with big enterprises.

Stanton Jones, ISG emerging technology analyst, said: "Cloud services, especially shared platforms, are a new terrain for providers and clients alike, as they are highly standardised and can't be easily customised – the antithesis of traditional outsourcing.

"Clearly, cloud is a disruptive trend in the enterprise, and we predict that this disruption will not only continue but accelerate, especially for the traditional IT service providers. From well-known software vendors to more nimble mid-market players and emerging pure-play infrastructure and SaaS providers, traditional IT service providers face significant pressure in nearly every direction."