Sovereign cloud and confidential computing shaping cloud’s future | HCLTech

Sovereign cloud and confidential computing shaping cloud’s future

In 2024, cloud computing continues to evolve and provides financial value to businesses that emphasize security, data sovereignty and confidential computing
 
11 minutes read
Mousume Roy
Mousume Roy
APAC Reporter, HCLTech
11 minutes read
Sovereign cloud and confidential computing shaping cloud’s future

Cloud computing continues to evolve as the optimal platform for business. According to the HCLTech Trends 2024 report, the future of cloud computing includes continuous growth and innovation. Report statistics indicate a pervasive increase in cloud adoption and describes the transformative power of cloud solutions as catalysts for innovation.

Cloud computing can be described as a megatrend, reshaping the way organizations navigate data sovereignty and achieve agile delivery of enterprise applications, confident that security and privacy can be implemented. As more sensitive data is stored and processed in the cloud, ensuring data sovereignty, the right of governments and individuals to control their data, is paramount. Organizations must also be agile enough to adapt to changing business needs and technological advancements, while also being resilient to cyberattacks and other disruptions.

With global end-user spending on public cloud services projected to reach a staggering $679 billion by 2024, the HCLTech Trends 2024 report provides a comprehensive forecast for the year ahead, shedding light on the trends that will shape the cloud landscape. As businesses strive to strike a balance between the advantages of cloud computing and the imperative to maintain control over their data, the report’s view on cloud computing emerges as a guiding light.

Understanding the current cloud computing landscape

Enterprises are leveraging cloud to enhance efficiency and facilitate digital transformation. The statistics indicate increasing adoption of cloud as a primary platform for business. The report highlights the adoption rate for cloud computing today and statistics illustrate that cloud is reliable, cost effective and provides scalable, flexible computing resources for the enterprise.

The HCLTech survey results, titled Cloud Evolution: Make innovation a habit, reports that 87% of senior executives who have pivoted their business strategy in past three years say they couldn’t have done it without cloud. The full report, sponsored by HCLTech and conducted by FT Longitude, summarizes the concerns and aspirations of 500 senior decision makers as they look forward to future of cloud as business enabler.

Investors, analysts, and enterprises across industries are interested in AI and the latest advancement – generative AI. Businesses are exploring the potential of genAI, and cloud is the platform enabling innovation adoption. “Cloud keeps creating generational and social changes,” says Siki Giunta, EVP CloudSMART Strategy and Industry Cloud. “A popular, commercial example of generative AI is ChatGPT which requires an enormous amount of available data and high-speed access which is facilitated by cloud. Businesses need to work out whether they have enough quality data to enable the ChatGPT models, and they need the right cloud strategy to start using generative AI at scale to make important decisions.” Giunta continues, “Many enterprises are experimenting with models and genAI in pilots and POCs but only organizations with mature data and cloud management will be able to move from pilot to production.” 

Organizations are increasingly adopting a multi-cloud culture - a combination of public and private cloud infrastructures. Giunta explains: "Hybrid and multi-cloud strategies represent a pivotal shift in how businesses approach infrastructure. The ability to seamlessly integrate and manage workloads across different cloud environments is becoming essential for enterprises seeking to respond to optimize performance and innovation." Another consideration for optimizing cloud is adopting new technology and processes for securing data while enabling access. Two important trends impacting the future of cloud are sovereign cloud and confidential computing.  

Responsible and Resilient Cloud

Confidential computing emerges as a critical innovation – providing secure accessibility to cloud data regardless of where the data is stored.  With 42% of respondents acknowledging that confidential computing is in early stages of adoption, analysts predict an annual growth rate of 46.8% between 2023-2032 with a projected market size of $184.5 billion by 2032. Businesses with applications that can benefit from confidential computing like financial services and pharma recognize the potential value. Addressing inherent security limitations in traditional cloud models confidential computing provides assurance for organizations moving mission critical applications to the cloud, Giunta explains, "Confidential computing isn't just about safeguarding data; it's like having a trustworthy ally in the digital world. Imagine your data being protected with the utmost care, ensuring that your most sensitive workloads can seamlessly transition from the constraints of traditional on-premises setups to the liberating space of the modern public cloud."

With every innovation, confidential computing is one of them, there are considerations for adoption. These considerations include choosing the right hardware, network schema and determining how you will manage performance and interoperability with existing networking. Guinta emphasizes: "Effective management becomes paramount. Automation, analytics, and intelligent monitoring will be instrumental in ensuring optimal performance and cost-effectiveness implementation of confidential computing in the cloud. Service partners can play an important role for enterprises creating a knowledge and skills base. "

Sovereign cloud: Digital Independence

Sovereign cloud is pivotal for global businesses requiring digital independence while valuing data autonomy. Angela Merkel, former chancellor of Germany and scientist, documents the obvious, “In the digital age, data is the new oil, and data sovereignty is the new power."

In the HCLTech Trends 2024, 47% of respondents believe that reducing complexity and ensuring data sovereignty will be the top priority for enterprises. Giunta explains the role of sovereign cloud in meeting regulatory requirements: "Sovereign cloud and confidential computing provide similar value - working together they provide the business community with stronger data security, protecting enterprises from unauthorized access while staying compliant with regulatory requirements. "

With a projected compound annual growth rate of 17.75% by 2030 and a market size anticipated to reach $99 billion, sovereign cloud is poised to play a pivotal role in shaping the future of cloud computing. Organizations are increasingly concerned with protecting data as competitive advantage. The projected adoption rate reflects the continuing demand for reliable, trusted cloud services which meet diverse industry requirements.

Sovereign cloud enables organizations to meet regulatory requirements by ensuring data is stored and processed within the legal boundaries of a jurisdiction. The financial value derived from sovereign cloud adoption is substantial. Organizations can serve customers, process transactions, conduct research knowing that they are compliant, but most important able to protect sensitive data and applications.

Successful implementation of sovereign cloud will reduce data latency, improve the performance of real time data processing and support disaster recovery solutions. Sovereign cloud provides a resilient and secure foundation for enterprises and countries navigating the complexities of the digital era.

HCLTech Trends 2024 Research

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Sovereign Cloud Adoption

Two factors are driving adoption of sovereign cloud. First is the increase in demand for data protection and transparency from customers. Many users have experienced the negative and costly consequences of personal data breaches and as a result are more vocal in seeking assurance that their personal data is safeguarded by technology vendors and application providers.

Sovereign cloud adoption gives a business the ability to commit to data privacy, fostering trust and confidence with customers, employees, and partners. Escalating geopolitical tensions and the associated risks linked to data extraterritoriality are playing a crucial role in steering organizations toward sovereign cloud adoption. Sovereign cloud is a strategic choice for businesses and governments navigating global complexities and requiring a secure and compliant environment that satisfies customer expectations and regulatory frameworks.

Because of technology the world is shrinking!  Nations are interconnected by commerce and banking. This introduces new concerns that if attacked critical data could be lost or fall into the wrong hands.  For example, a week before the Russian invasion of Ukraine, the parliament passed legislation to allow government and private sector data to be moved to the cloud. Ukraine securely migrated data to AWS enhancing data resilience and ensuring continuity amidst the chaos of the war.

In an HCLTech Trends and Insights interview on this topic earlier this year, Guinta explained: “Cybersecurity was maintained and data required for population management was controlled and protected by selecting the cloud as a secure way to store data about 42 million citizens. This is a dramatic example of the resilience and scalability that cloud enabled in the face of geopolitical challenges.” 

The outlook for cloud computing

The HCLTech Trends 2024 report paints a compelling picture of cloud as an innovation platform for businesses looking for a competitive edge. From the rise of multi-cloud adoption to the disruptive potential of confidential computing and the important role of sovereign cloud the report suggests a roadmap for organizations defining the financial value of cloud and its role in achieving their business strategy.  

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