92% of Companies in EMEA and 93% in AsiaPac to Increase Amount of Data Stored in Public Cloud in 2024

1/ 92% of Companies in EMEA to Increase
Amount of Data Stored in Public Cloud in 2024

European organizations are still beleaguered by storage bills as 50% of all cloud storage costs in EMEA go to data access and usage fees rather than capacity, according to the 2024 Global Cloud Storage Index from Wasabi Technologies, Inc., EMEA companies see the value of cloud storage services and plan to increase their spend in 2024 in order to drive IT initiatives like application or infrastructure migration and development, and to improve business and operational initiatives such as digital transformation or modernization.

Commissioned by and conducted by Vanson Bourne, the index uncovers the changing attitudes toward public cloud storage adoption, the factors that influence storage buying decisions, and the market’s top priorities. It surveyed 1,200 global IT decision makers, all of whom are involved in their respective organisations’ storage strategy.

“Organisations worldwide are increasing their use and budgets for public cloud storage solutions, and Europe is no exception,” said Andrew Smith, senior manager of strategy and market intelligence at Wasabi, and a former IDC analyst. “Like the rest of the world, European cloud storage users continue to struggle with storage fees, but despite this, the region continues to show a healthy preference toward “cloud-first” decision making when it comes to IT services adoption.”

EMEA business are spending more on cloud storage fees than their global counterparts. On average in EMEA, organizations spend 50% of their cloud storage budgets on fees, not storage capacity, compared to global average of 47%.

The UK however has a slightly lower percentage of bills allocated to fees than the rest of EMEA, at 48%, while Germany has the highest at 51.5%.

In 2023, the majority of EMEA respondents exceeded their cloud storage budgets.

France indicated the highest level of excess, at 57%, followed by the UK (55%) and Germany (51%).

Europe’s “cloud-first” and multicloud mentality
Europe is slightly ahead of the global curve when it comes to pursuing a “cloud-first” strategy for IT services adoption (as opposed to any alternative requiring owned or on premises IT infrastructure) at 44% compared to the global average of 42%. This difference was largely driven by Germany (51% “cloud-first”) and France (47% “cloud-first”).

When choosing a cloud storage provider, EMEA respondents prioritizes integrations with existing 3rd-party apps like Salesforce and Veeam (43%), security and compliance features, (40%) and sustainability (39%).

Additionally, EMEA continues to explore adoption of multiple cloud storage providers. When asked to identify the important drivers of multicloud adoption, 48% of EMEA respondents say it is to avoid vendor lock-in – making it the top-ranked reason.

AI/ML technology and service adoption will drive innovation, but create new cloud storage challenges

When it comes to AI and ML technologies, 99% of EMEA respondents say they have adopted or are planning to adopt AI/ML in 2024, driven in large part to accelerate product/service innovation and to create operational efficiencies for the organization. Overall, generative AI is the top use case for EMEA.

However, there are differing AI/ML tech priorities at the country level:

• Germany ranked GenAI as a distant 4th of its top AI use cases. Ahead of GenAI are AI and ML solutions for product design (49%), solutions for security and compliance (47%), and solutions for computer vision (38%)
• The UK ranked AI/ML solutions for document processing or creation significantly higher than the norm. It is their #2 use case (48%) behind GenAI (52%)
• France prioritizes predictive analytics as their #2 AI use cases (39%) behind GenAI (47%)

Regardless of the AI/ML workloads organizations are implementing or planning to implement, 96% of EMEA respondents believe they will face new cloud storage concerns associated with AI/ML.

The top EMEA concerns include:

• Requirements to store data across a wider range of locations (e.g., core data centers and edge/remote locations) (46%)
• Addressing new backup, protection and recovery requirements (43%)
  New or increasing storage migration/movement requirements (including hybrid or multicloud storage) (42%)

2/ 93% of AsiaPac Organizations Expect to Increase
Amount of Data They Store in Public Cloud in 2024,
Up 8% from Last Year

The index also shows 47% of respondent’s cloud storage bills are allocated to various data operations and retrieval fees. AsiaPac enterprises are no exception, with a similar proportion of billing allocated to fees. Japan and Australia indicated an even higher proportional mix of fees, at 50%.

Nevertheless, countries across the AsiaPac region continue to increase their budgets and the amount of data they store in the cloud to support new IT initiatives like cloud infrastructure migration and modernization, and to enhance backup, recovery, and other data security requirements.

• Japan is planning for continued investments in cloud storage, despite an unfavorable mix of spending on storage-related data fees
• 94% of Japan respondents say they will increase the amount of data they store in the public cloud in 2024, a slightly higher rate than the global average of 93%
• However, a large proportion of storage spending in Japan goes to storage fees, not storage capacity. Japan organizations say half their cloud storage bill (50%) is consumed by storage fees like data operations, retrieval, transfer, and egress
• These fees are part of the reason why 55% of Japan organizations say they exceeded their budgeted spend on cloud storage
• When asked about AI/ML initiatives, generative AI ranked #1 among Japan as the leading workload planned for deployment, or currently deployed
• When asked about the top priorities driving AI/ML adoption in 2024, Japan respondents ranked accelerating innovation and development cycles for existing products/services and improving customer facing product/services as their top drivers
• Thinking specifically about storage-related AI/ML challenges, Japan ranked unpredictable storage cost patterns (e.g., egress fees, data access fees), as a leading concern

“Despite many organizations struggling to control cloud costs due to complex and ubiquitous fee structures, we’re still seeing continued growth and adoption across the AsiaPac region, particularly in Japan,” said Smith. “44% of AsiaPac respondents we surveyed consider their organization’s IT services adoption strategy to be ‘cloud-first,’ indicating they will continue to prioritize cloud services adoption over any alternative requiring owned or on-premises infrastructure.“

• 100% of Australia respondents say their organization will adopt, or will plan to adopt AI/ML applications or services within the next 12 months
• 89% of Australia respondents say they expect to increase the amount of data their organization stores in the public cloud in 2024. This is slightly below the APAC average of 93%, but still an impressively high result
• 83% of Australian respondents say they expect their organization’s public cloud storage budget to increase in 2024
• Similar to Japan, Australia also has a slightly higher proportional mix of spending on fees, with respondents saying 50% of their cloud storage budget is allocated to fees. This unfavorable mix is likely part of the reason why 50% of Australian respondents say their organization exceeded budgeted spend on cloud storage last year
• All of our Australia respondents (100%) say their organization is adopting or planning to adopt some form of AI/ML application or service within the next 12 months. Certainly, this indicates an eager willingness to expand AI/ML solutions and strategies in Australia, but this endeavor won’t come without infrastructure-related challenges. Specifically, Australia respondents indicated a high rate of concern with addressing new data backup, protection and recovery requirements associated with AI/ML adoption
• Singapore prioritizes IT cloud services sustainability, and looks to drive operational improvements through AI/ML solution adoption
• For the 2nd year in a row, Singapore ranked sustainability (in terms of infrastructure architecture, service provider initiatives/commitments, or built-in tools for things like carbon footprint calculation) as the #1 most important consideration when it comes to choosing a cloud storage provider/service
• Singapore indicates a lower proportional mix of cloud storage fees (with only 44% of billing allocated to fees, on average). However, counterintuitively, Singapore indicated the highest rate of budget excess among all countries surveyed; with 66% of Singapore respondents saying their organization exceeded budgeted spend on cloud storage in 2023
• Singapore ranked operational improvements as the #1 driver for AI/ML implementation, and chose AI/ML solutions for security and compliance (e.g., advanced anomaly detection) as the top workload their organization has implemented or is planning to implement solutions for

“It comes as no surprise that AsiaPac followed suit with the global trend that ranked AI/ML incorporation as a top priority,” said Michael King, VP and GM, AsiaPac and Japan. “Enterprises are realizing that to maintain a competitive edge, they must find new and innovative ways to deploy AI capabilities, both for internal processes and as offerings to customers. That is why many are looking to increase their storage amount to host the mountain of data that is necessary to run AI/ML applications that have become so critical.”

• Emerging AsiaPac markets (India and South Korea) indicate even higher rates of cloud storage capacity and budget growth, and are prioritizing unique use cases when it comes to AI/ML adoption
• This year the index included respondents from India and South Korea in order to gain perspective and understanding on high-growth markets within the larger AsiaPac region
• 96% of respondents across both India and South Korea indicate their organization will increase the amount of data stored in the public cloud in 2024
• Similarly, 96% of South Korea respondents say their organization will increase public cloud storage budgets in 2024 (compared to 90% in India)
• India and South Korea both ranked “accelerating innovation and development cycles for existing products/services” as the leading driver of AI/ML solution adoption. In terms of planned and implemented AI/ML workloads, India ranked computer vision (inclusive of a range of image and video processing or recognition) as a leading use case, and South Korea identified gaming applications (including 3D rendering) as one of its top 3 workloads driving AI/ML adoption, higher than any other country surveyed

Methodology
Wasabi commissioned independent market research agency Vanson Bourne to conduct research into cloud storage. The study surveyed 1,200 IT decision makers who had at least some involvement in or responsibility for public cloud storage purchases in their organization. The research took place in November and December 2023 from organizations with more than 100 employees across all public and private sectors. All interviews were conducted using a multi-level screening process to ensure that only suitable candidates were given the opportunity to participate.