- Companies are increasingly pursuing the strategy of using more than one cloud provider, but it’s an area where businesses in Asia have had a head start, according to analysts and executives who participated in Business Insider’s recent roundtable.
- Using multiple clouds can give customers access to different services and help them avoid getting locked into one cloud.
- “In Asia, many of the best companies have a multicloud strategy, and that’s because they service different markets in Asia,” Cloudflare Chief Operating Officer and cofounder Michelle Zatlyn said.
- While firms in Asia adopted that mode out of necessity, she said, it’s now becoming the prevailing strategy in the US and Europe as well.
- Visit Business Insider’s homepage for more stories.
Companies are increasingly pursuing the strategy of using more than one cloud provider, but it’s an area where businesses in Asia have had a head start.
Using multiple clouds can give customers access to different services and help them avoid getting locked into one cloud. Globally, 81% of cloud-user respondents in a 2018 Gartner survey said they worked with two or more providers, but North American companies have adopted this approach more slowly: Within North America, 64% of enterprises have a multicloud strategy, up from 59% last year, according to Flexera.
There are a few reasons that companies in Asia were earlier to this trend, according to both analysts and an executive who participated in Business Insider’s inaugural roundtable conversation of Enterprise Tech Transformers. Here’s what they told us:
Why Asia was early to multicloud
A multicloud strategy became an early norm for in the Asia-Pacific region for a handful of key reasons, according to Forrester principal analyst Charlie Dai: a gap between what businesses needed and the technical capabilities of individual clouds, geopolitical concerns, and the desire to avoid relying on a single provider.
Companies in Asia-Pacific “primarily use multicloud to meet customer needs and drive business growth, achieve regulatory compliance, expand business ecosystem, and enhance operational resiliency,” Dai said.
On the regulatory front, many countries in the Asia-Pacific region have data-protection laws that require sensitive data to be stored within the country, Evan Zeng, Gartner’s senior research director, said.
As a result, a company may pick Alibaba Cloud for markets in China and another cloud provider, like Google Cloud, for business in another region. The various cloud firms also don’t all provide identical services in each country.
“In Asia, many of the best companies have a multicloud strategy, and that’s because they service different markets in Asia,” Cloudflare Chief Operating Officer and cofounder Michelle Zatlyn said during the roundtable discussion. “Asia is a huge market, and the main cloud providers — AWS, Azure, Google Cloud, Ali Cloud — all have different strengths in the region, and so businesses mix and match.”
Read more: 5 enterprise tech execs discuss remote work, new cybersecurity threats, and why Asia was first to multi-cloud
While firms in Asia adopted that model “for a long time” out of necessity, she said, it’s now becoming the prevailing strategy in the US and Europe as well:
“What we’re seeing now is they’re like, ‘Wait, that’s too much dependency, too much vendor lock in, too much vendor power. We want to diversify our cloud storage and compute vendors,'” Zatlyn said. “And so it’s almost like what Asia had done from necessity.”
Asia-Pacific companies that operate in multiple countries may also need to provide their customers with different tools depending on the economic market, which could lead to favoring different cloud platforms and tools based on the region, according to Winnie Lee, a cofounder of the Taiwan-based marketing-AI company Appier.
For example, in Singapore, banks have been adopting artificial intelligence for financial services like credit cards and loans, while in countries with developing economies — like the Philippines, Indonesia, or Vietnam — they’re using AI to figure out credit risk for borrowers, as many people still don’t have bank accounts.
Got a tip? Contact this reporter via email at [email protected], Signal at 646-376-6106, Telegram at @rosaliechan, or Twitter DM at @rosaliechan17. (PR pitches by email only, please.) Other types of secure messaging available upon request.