Category: Technology Expense Management

Posted on by

Market Alert: Vendr Raises $150 Million B Round to Help Enterprises Purchase SaaS More Efficiently

On June 16, 2022, Vendr, a SaaS (Software-as-a-Service purchasing platform) announced a $150 million Series B round co-led by prior investor Craft Ventures and novel investor SoftBank Vision Fund 2 and joined by Sozo Ventures, F-Prime Capital, Sound Ventures, Tiger Global, and Y Combinator. The company states that this funding will drive platform enhancements.

Why this funding announcement matters

To fully contextualize this announcement, Amalgam Insights will dig into the context of the macroeconomic issues driving the importance of this announcement, the tactical importance of a SaaS purchasing solution in the Technology Lifecycle Management (TLM), and the nature of the investment compared to other historical funding announcements in the TLM space.

Macro Trends for Corporate Spend Reduction

First, this announcement comes at a time when the United States is facing inflation that approaches double-digits. The current 8.6% inflation rate in this country threatens to devour the average 8.19% net margin that publicly traded companies (excluding financial services) currently achieve. In addition, we are facing a global recessionary trend driven by COVID, supply chain issues, geopolitical strife including the occupation of Ukraine, strained Sino-US relations, inconsistent oil and gas policies, and an excess of money supply created over the past several years. In the face of these global challenges, it is prudent for companies to seek to reduce discretionary costs where it is possible and to shift those costs to strategic growth areas. Traditionally, recessions have been a time when strong companies invest in their core so that they can execute when the economy picks up again.

SaaS as a Strategic and Expanding Complex Spend Category

In this context, SaaS is a massive, but complex, opportunity to cut costs. Amalgam Insights estimates that the SaaS market has grown 25% per year in each of the last two years. Multiple studies show that enterprises that have reached the billion-dollar annual revenue threshold average over 300 apps directly purchased by the organization and over 900 apps running over their networks, either on in-office networks or on employee devices. The hundreds of apps here obviously equate to hundreds, possibly thousands, of accounts and bills that can be consolidated, negotiated, and potentially rationalized to concentrate spend on strategic vendors and gain purchasing power. It is not uncommon to find large enterprises using 20 or more different project management solutions, just to look at one SaaS subcategory.

This rationalization is vital if enterprises are to take the IT Rule of 30 seriously. Amalgam Insights states that the IT Rule of 30 is that any unmanaged IT category averages a 30% opportunity to cut costs. But that 30% requires following the Technology Lifecycle to fully uncover opportunities to cut costs.

Technology Lifecycle Management

The majority of companies that Amalgam Insights speaks to in the IT expense role limit their diligence in IT spend to the right side of this lifecycle including timely bill payment, possibly cross-charging to relevant business entities and cost centers, and right-sizing expenses by finding duplicate or over-provisioned accounts. While this is necessary to execute on the IT Rule of 30, it is not sufficient. In the SaaS space, Amalgam Insights believes there is conservatively a $24 billion spend reduction opportunity globally based on improved SaaS purchasing and negotiations. At the micro level, this equates to a 2 million dollars for the average billion-dollar+ enterprise, with results varying widely based on SaaS adoption (as SaaS only makes up 30% of overall enterprise software spend globally), company size, and level of internal software contract knowledge.

Putting The Investment in Perspective

Amalgam Insights understands the scale of this business opportunity. Even so, this $150 million B round represents a massive round in the Technology Lifecycle Management space. Consider other large funding rounds in this space including:

Zylo’s 2019 $22.5 million B Round for SaaS Management

BetterCloud’s 2020 $75 million F Round for SaaS Management

Productiv’s 2021 $45 million C Round for SaaS Management

Beamy’s 2022 $9 million A Round for European SaaS Management

Torii’s 2022 $50 million B Round for SaaS Management

and looking further across the Technology Management spectrum

Cloudability’s 2016 $24 million B Round for IaaS Management (later acquired by Apptio)

CloudCheckr’s 2017 $50 million A Round for IaaS Management (later acquired by NetApp)

CloudHealth’s 2017 $46 million D Round for IaaS Management (later acquired by VMware)

MOBI’s 2015 $35 million investment round for Managed Mobility (later acquired by Tangoe)

I hasten to add here that more is not always better. But this range of funding rounds is meant to show the amount of investment that typically goes into solutions designed to manage technology expenses, inventory, and sourcing. At first glance, Vendr’s funding round may seem like just another funding announcement in the billions and trillions of dollars involved in the tech sector to those who do not cover this space closely. But as someone who has covered telecom, cloud, and SaaS expense management closely for the last 14 years, this round stands out as a massive investment in this space.

In addition, the investors involved in this round are top-tier including Craft Ventures, where founder and ex-Paypal founder David Sacks has been a proponent of Vendr, and the combination of Tiger Global and Softbank, which may be the two most aggressive funds on the planet in terms of placing big bets on the future. The quality of both smart money and aggressive money in this investment during a quasi-recessionary period speaks to the opportunity that exists here.

What to expect from this round?

The official word from Vendr so far is that this funding round is about data and platform. Vendr acquired SaaS cost and usage monitoring firm Blissfully in February 2022 to bring sourcing and expense management together and support the full lifecycle for SaaS. Amalgam Insights expects that some of these funds will be spent to better integrate Blissfully into Vendr’s operations. In addition, the contract information that Vendr has represents a massive data and analytics opportunity, but this will likely require some investment into non-standard document management, database, machine learning, and data science technologies to integrate documents, tactics, terms, and results. Whether this investment takes the form of a multi-modal database, graph database, sentiment analysis, custom modeling, process mining, process automation, or other technologies is yet to be seen, but the opportunity to gain visibility to the full SaaS lifecycle and optimize agreements continuously is massive not only from a cost perspective, but also a digital transformation perspective. The data, alone, represents an immediate opportunity to either productize the benchmarks or to provide guidance to clients with ongoing opportunities to align SaaS usage and acquisition trends with other key operational, revenue, and employee performance trends.

This part is editorializing, but Vendr has the opportunity to dig deeper into tech-driven process improvement compared to current automation platforms that focus on documenting and driving process, but have to abstract the technologies used to support the process. In the short term, Vendr has enough work to do in creating the first SaaS Lifecycle Management company that brings buying, expense, and operations management together. But with this level of funding, Vendr has the opportunity to go even further in aligning SaaS to business value not only from a cost-basis perspective, but from a top-line revenue contribution perspective. Needless to say, Amalgam Insights looks forward to seeing Vendr deliver on its vision for managing and supporting SaaS management at scale and to tracking the investments Vendr makes in its people, products, and data ecosystem.

Posted on by

HP Offers to Acquire Poly

On March 28, HP announced an offer of $3.3 billion to acquire integrated communications vendor Poly. Poly, created from the merger of Plantronics and Polycom, acquiring @PolyCompany is interesting because both firms have a long history of supporting remote and home offices. Both companies have dealt with the challenges of the digital office. But this acquisition hints at a potential split for HP.

HP is obviously known as a printer company and printer ink prices ($3,000 per gallon) make even the most expensive gas pumps look like amazing bargains. But HP also has its Z by HP workstation brand, which is well-aligned to the Poly portfolio. It would be great to see that combined Poly/Z portfolio come together as the future of the digital office and to create that new “office in a box” or “office in a browser” that is always a goal for tech companies. There are still a few gaps in the portfolio, though.

The starting point is good spatial audio. As Poly has known since its telepresence days, 2 big secrets to optimal video conferencing are life-sized video and spatial audio. Both are hardware accessory issues: camera & speakers. Poly is great at the former, so-so at the latter. To take this a step further, HP Poly can be the smart accessory (and maybe even the programmable accessory) company providing all of the accessories beyond the phone and PC to support a better office, but this also requires continued API investment. Poly could have been the smart watch & VR headset company, but didn’t keep up. The opportunity is still there if Poly takes the immersive home office seriously and provides the one-stop shop for transforming the kitchen/guest bedroom/garage/remote office room into a communications hub.

And all that video and audio data is an obvious fit with the #datascience @ZbyHP portfolio. So, if all this makes sense, what is the issue?

Printer Ink.

For HP to pursue this path, it must embrace a business model path with one eye towards the actual Metaverse: VR, AR, workflow digitization, & eliminating the need for print. Z/Poly provides an obvious set of next steps: smart accessories, continued growth of the developer community, process automation & workflow orchestration Printers can be a part of this future if they are “iPhoned” to support higher dpi & eliminate the need for constant ink but anybody who has ever tried to implement a printer from scratch knows just how prehistoric this experience is compared to the mobile, SaaS, Big Data world that is pervasive in our consumer lives where even our refrigerators and light bulbs are now able to give us recommendations.

Does HP have the stomach to truly disrupt itself over the next decade, as Netflix wiped out its mail business & destroyed the value of its DVD library? Or will it spin out Z/Poly to maximize value? Or will Poly become a cash cow held back by legacy HP? HP now has more tools to truly reinvent the digital home office when remote employees can dip into the real estate budget. It will be fairly clear within this calendar year which of these three options ends up being HP’s true intentions: wither, cash cow, or innovate.

For the sake of the innovative geniuses who have worked at Plantronics and Poly love the years, I really hope their technology gets a chance to reach the next level. And as an analyst, I look forward to seeing what big brains @blairplez @DaveMichels @zkerravala have to say about this proposed acquisition as I have found their guidance and perspective invaluable over the years as an analyst who has dabbled in their market.

From a Technology Expense Management perspective, the big takeaway here is that the telecom environment is going farther and farther away from the dedicated phone systems and now even mobile devices that have traditionally been the hub of voice and video. HP’s acquisition of Poly will be part of a trend of creating more focused home office solutions as the future of the hybrid workplace requires less investment in 100,000 square foot (10,000 square meter) headquarters spaces and more investment in the 20 square feet (2 square meters) that we choose to work in at any given point. These accessories will require purchasing and tracking just as all business assets require and may have additional connectivity or computational support demands over time just as smartwatches, connected Internet of Things devices, and devices using edge computing require. Connected devices belong in a unified endpoint management solution, but this HP acquisition may start leading to some questions as to whether remote office management is part of a managed print strategy, enterprise mobility strategy, or general IT asset strategy. Amalgam Insights recommends that remote office tech investment, which will eventually match enterprise mobility as a $2,000/employee/year total cost of ownership for all relevant hybrid and home employees, should be handled as part of an enterprise mobility strategy where device management and logistics have already been defined.

Posted on by

Russia Invades Ukraine: 5 Considerations for the IT Community

As anyone who has checked the news today is aware, Russia invaded Ukraine early this morning as the United Nations was holding an emergency meeting seeking to persuade Russia not to invade. The initial results have included stunning pictures of Russian military vehicles and missiles entering Ukraine, the Moscow Stock Exchange falling over 30% in one day, and new international sanctions.

Although the subtleties of geopolitical complexity, NATO, the historical Russian Empire, Ukranian governmental changes, European oil and gas supplies, and nuclear arms are far far far beyond the scope of what we cover at Amalgam Insights, we absolutely hope for a quick and peaceful end to this attack.

In the meantime, we live in a global economy and there are specific aspects of this invasion that specifically affects the IT world.

First, plan for potential delays in software development. Ukraine had established itself as an important nearshore and offshore application development source with over 200,000 skilled developers. Many top software companies and enterprises employ developers from Kyiv and other Ukrainian cities. With this invasion, developers are either moving west to Lviv, Ivano-Frankivsk, and Lutsk or into Poland or being conscripted into defense forces. From a practical perspective, this is going to delay development of new versions and features. Check up with your key vendors to see whether there are expected delays based on this issue. Obviously, there is no feature more important than these lives; this is just about being able to manage expectations and to keep in touch with the people who are building the tools you use at work.

Second, check up on cybersecurity. With current sanctions and financial access locked down, Russia will be looking for liquid funds by any ways necessary. This includes ransomware, accessing computing for cryptomining, and using remote computing to mask trails to access other digital assets. This is a good time to update your patches and passwords and to be diligent on social engineering schemes designed to get employees to click through or give away passwords on the phone. Clicking unknown links is always bad, but this is an especially good time to be paranoid about updates even from trusted vendors and suppliers.

Third, keep your cryptocurrency and NFTs (non-fungible tokens) safe. Crypto has been an enabler for black market activity because of its nature as a relatively liquid asset that is relatively easy to transfer. Make sure that any digital assets you or your organization have are backed up on a well-governed store such as ClubNFT. And make sure your crypto is safe on a wallet you own.

Fourth, budget for cloud costs to increase quickly over the rest of the year as the cost of computing increase. Russia and Ukraine are the primary producers and purifiers of the noble gas neon, which is used to etch semiconductors from 180 to 1X nm nodes, which make up roughly 75% of the total market. Ukraine provides 90% of the world’s supply of purified neon, with Iceblick alone estimated to provide over 60% of the world’s neon. As strategic Ukrainian targets are attacked, the supply of neon will decrease in the short term making chip prices go up. Even if Russia manages to create its own purification capacity, sanctions will make neon extremely expensive. As an example, when Ukraine was initially invaded in 2014, neon prices went up 6x.

Fifth, expect a flood of disinformation across all areas. Modern war is conducted not only as a military exercise, but as a financial, digital, informational, and political exercise. There are aspects of information that Putin and the Russian government are interested in controlling for their own specific reasons that can lead to non-factual announcements. This is going to be, in technical terms, “a pain in the ass” to manage as fact checking becomes more important. This may include disinformation around cybersecurity, healthcare, politics, or any other number of areas with the goal of providing distractions. As a key ally of Ukraine and a core member of NATO, the United States will likely be a target of the social rumor mill in a variety of ways. Ironically, I’ll use a Russian proverb for this recommendation: Доверяй, но проверяй (Doveryay, no proveryay – Trust, but verify).

And, obviously, make sure that your organization is not dependent on Russian computing and financial resources as the risk that those resources will be cut off from the rest of the world is unfortunately real as the escalation of cyber and financial conflict increases.

This invasion is a sad and worrisome time for the world. In our roles as technologists and IT shepherds, there is only so much we can do. But it is up to us to make sure that the assets and services that we manage are kept safe and in control in challenging times. Stay safe and keep your organization as safe as possible.

Posted on by — 1 Comment

Upcoming Amalgam Insights Report Alert: “Control Your Cloud”

The Big Takeaway: Cloud computing spending has reached new heights. Organizations need guidance to avoid wasting money. The “Control Your Cloud” SmartList will provide guidance for enterprises struggling to manage cloud costs.

Amalgam Insights forecasts that global spending on public cloud computing — including infrastructure and software — will total more than $350 billion in 2022. Driven by the ongoing COVID-19 pandemic and concurrent digital transformation projects, organizations will continue to invest in the cloud, to the tune of more than 20% this year. And the greater the investment made in cloud, the more room for waste. 

Savvy stakeholders, especially those who already pay attention to expenses in other technology categories (mobility, telecom, Software as a Service), know that uncontrolled cloud computing will significantly reduce any return on investment. Just as with wireless or networking or other strategic IT spend categories, department heads must come together to craft a strategic approach to overseeing cloud computing deployments and expenses. The stakes are too high.

Consider the wider perspective: Between 2020 and 2021, spending on public infrastructure as a service (IaaS) and platform as a service (PaaS) soared 37%. In numbers, that totals a $60 billion increase. 

Kelly Teal, Senior Research Analyst, Amalgam Insights

COVID-19, of course, served as the impetus for much of that growth. Anecdotally, cloud computing vendors have reported that the demand they expected to serve around 2030 hit a decade earlier because of the pandemic. As governments worldwide mandated lockdowns, organizations had to rush to support work-from-home setups for employees. Cloud computing delivered many of the capabilities businesses needed; IT teams scrambled, often cobbling together solutions that met staff needs but were not cost-effective. Leaders spent much of 2021 trying to rectify those issues, yet more cleanup remains to be done. Contractual obligations, employee preferences, and heavy lifting associated with a technology shift all can slow the process. 

At the same time, organizations face new challenges in 2022. Inflation rose by 7% by the end of 2021, just in the United States, according to the Consumer Price Index. Everyone is paying more for the same products and services, and wages are not keeping pace. Revenue may not make up for the gap, either. This leaves executives and line-of-business leaders more aware of spending than perhaps ever. Cloud computing represents a major area ripe for attention. 

Cloud computing also accelerates the ability to bring new ideas to market and execute on business opportunities. At a time when the attention and relationship economies require deeper and more data-driven understanding of customers, cloud computing allows access to the analytics, machine learning, and relevant connections that achieve that. Organizations need to translate new ideas into fully-fledged business units without investing millions of dollars in upfront cost on computing assets.

However, IT should not act alone when it comes to deciding how to manage cloud computing expenses just for the sake of getting the job done in a convenient way. Cloud computing, just like its wireless and telecom counterparts, impacts the entire organization. Therefore, the finance, IT, revenue, security, and governance departments all must be involved, on some level, in overseeing cloud computing investments. For example, executives in charge of budgeting need to understand cloud computing costs; IT must select and manage platforms and assign and monitor users and consumption; software development and IT architects need to tag and track resources as cloud services are spun up and down; and data experts have to ensure that the organization’s information within the various cloud resources stays in line with laws such as Europe’s General Data Protection Regulation (GDPR). 

Cloud computing is complicated. Executives across the organization need a deeper understanding of the intricacies so they can work together to spend wisely while ensuring no critical aspect goes overlooked. Amalgam Insights is stepping in to guide organizations through these considerations with our upcoming Vendor SmartList, “Control Your Cloud: Why Organizations Need Cloud Cost Management Capabilities in 2022.” 

Executives seeking to control cloud expenses need to read this report because it will provide expert analysis on the key cloud cost containment challenges of 2022 and the differentiated approaches to reduce and optimize cloud costs. The report also will features vendor profiles that cut through the hype and show why each vendor is different in a sector where marketing messages all seem to focus on the same starting points of reducing cost, providing financial visibility, and improving cross-departmental collaboration. This last issue emphasizes an important point: The profiles do not rank the providers that brief with Amalgam Insights. Rather, Amalgam Insights explores what makes each vendor different and offers guidance on why that vendor is currently chosen in a crowded marketplace. This level of detail gives organizations the knowledge to pinpoint which vendor(s) might best meet their needs for cloud computing cost management. 

The following stakeholders all will need to read and act on the report: Chief Technology Officers, Chief Information Officers, Chief Financial Officers, “Shadow IT” managers in sales and marketing, DevOps Directors and Managers, IT Architects, Vice President/Director/Manager of IT Operations, Product Managers, IT Sourcing Directors and Managers, IT Procurement Directors and Managers, IT Service Providers and Resellers. Each of these roles is crucial to achieving cloud computing success throughout the organization.

“Control Your Cloud: Why Organizations Need Cloud Cost Management Capabilities in 2022” will publish in the second quarter of 2022. 

Posted on by

Amalgam Insights Debuts 2022 Vendor SmartList for Global Wireless Expense Management Leaders

Today Amalgam Insights publishes its latest Vendor Smartlist to support the Chief Information Officer, Global Wireless Expense Management Leaders for 2022. This report addresses the pain points organizations experience in trying to effectively manage the cost of employee smartphones, tablets, and laptops, as well as corporate Internet of Things sensors across multiple countries and regions. To check out the report, fill out the form below to get this report sent to your email address, then read on to find out what to expect.

The need for device oversight has grown even more critical throughout the COVID-19 pandemic as organizations must re-align spending in line with budgets in the face of a 30% increase in device spend in 2021. When it comes to wireless expense management (WEM), Amalgam Insights notes the IT Rule of 30, which states that any unmanaged IT spend category will average 30% bloat and enterprise mobility is no exception. Enterprises turning to an appropriate vendor can potentially reduce overspending and free internal employees, but these results are dependent on choosing vendors that have relevant experience.

Knowing which WEM provider to choose poses a conundrum for organizations. Amalgam Insights aims to solve this problem with Global Wireless Expense Management Leaders for 2022 by delivering independent insights and recommendations, along with in-depth vendor profiles of the eight largest standalone vendors managing wireless expenses based on spend under management and geographic footprint. Importantly, Amalgam Insights does not rank vendors. Instead, analysts focus on the differentiators among providers such as global coverage, ancillary spend coverage, governance and compliance, integrations, payment processing, automation strategy, and device lifecycle management.

“The Amalgam Insight Vendor SmartList focuses on specifying how vendors differentiate themselves in crowded markets where vendors can sound very similar,” says Amalgam Insights CEO and Principal Analyst Hyoun Park. “By focusing on unique or rare capabilities, CIOs can use the Vendor SmartList to make better decisions compared to raw rankings, reviews, or 2×2 matrices.”

Kelly Teal, Senior Research Analyst at Amalgam Insights, agrees.

“As the cost of doing business fluctuates due to global inflation, global organizations must assess the need to optimize wireless devices, services, applications, and support spend. Understanding the ways different global WEM vendors work with enterprises will help end-users identify the best approach for them and optimize spending.”

This report features Asignet, Calero-MDSL, Cass Information Systems (NASDAQ: CASS), Mindglobal, One Source Communications, Sakon, Tangoe, and Upland Software (NASDAQ: UPLD). Organizations may access the Global Wireless Expense Management Leaders for 2022 using the form below.

Posted on by

Reviewing 2021 IT Cost Trends

IT Cost Management is one of the core practices at Amalgam Insights. This practice focuses on tracking both vendors and product offerings that help enterprises fight off the IT Rule of 30, Amalgam Insights’ observation that every unmanaged IT category averages 30% in bloat and waste and that this can be even greater for emerging technology areas such as cloud computing.

From our perspective, the demand for a more holistic technology expense capability has been in demand at the enterprise level since the mid-2010s and companies narrowly focused on managing telecom, mobility, software, and cloud computing as four separate IT silos will miss out on a variety of opportunities to optimize and rationalize costs.

In this practice, we tactically look at technology expense management vendors, including specialists in telecom expense, managed mobility services, cloud cost management, cloud FinOps (Financial Operations), Software as a Service management, IT finance solutions, hybrid cloud subscriptions and financing, and other new IT strategies that can lead to a minimum of 20-30% cost reduction in one or more key IT areas. In each of these IT areas, Amalgam Insights maintains a list of recommended vendors that have proven their ability to deliver on both identifying and fixing the issues associated with the IT Rule of 30, which are provided both in our published research as well as in our end-user inquiries with enterprise clients.

With that out of the way, 2021 was a heck of a year from an IT management perspective. Although a lot of pundits predicted that IT spend would go down in a year where COVID-driven uncertainty was rampant, these cost control concerns ended up being less relevant than the need to continue getting work done and the resilience of a global workforce ready and willing to get things done. In doing so, 2021 saw the true birth of the hybrid worker, one who is just as comfortable working in the office or at home as long as they have the right tools in hand. In the face of this work environment, we saw the following things happen.

The Rise of the Remote Employee – Amalgam Insights estimates that 30% of employees will never be full-time in-office employees again, as they have either moved home full-time or plan to only come into the office one or two times per week as necessary to attend meetings and meet with new colleagues and partners. Although many of us may take this for granted, one of the issues we still face is that in 2019, only 5% of employees worked remotely and many of our offices, technology investments, and management strategies reflect the assumption that employees will be centrally located. And, of course, COVID-19 has proven to be both a highly mutating virus and a disease fraught with controversies regarding treatment and prevention strategies and policies, which only adds to the uncertainty and volatility of in-office work environments.

Legacy networking and computing approaches fall flat – On-premise solutions showed their age as VPNs and the on-site management of servers became passe. At a time when a pandemic was running rampant, people found that VPNs did not provide the protection that was assumed as ransomware attacks more than doubled in the United States and more than tripled in the United Kingdom from 2020 to 2021. It turns out that the lack of server updates and insecure ports on-premises ended up being more dangerous for companies to consider. We also saw the Death of Copper, as copper wired telecom services were finally cut off by multiple telecom vendors, leaving branch offices and the “Things” associated with operational technology rudely left to quickly move to fiber or wireless connections.  Blackberry finally decided to discontinue to support of Blackberry OS as well, forcing the last of the original Blackberry users to finally migrate off of that sweet, sweet keyboard and join the touch screen auto-correct world of smartphone typers. It was a tough year for legacy tech.

Core Mobility Grew Rapidly in 2021 – Core spend was up 8% due to device purchases and increased data use. In particular, device revenue was up nearly 30% over last year with some of the major carriers, such as AT&T, Verizon, and T-Mobile (now the largest carrier in the United States). However, spend for customized and innovative projects disappeared both as 5G buildouts happened more slowly than initially expected and 5G projects froze due to the inability to fulfill complex mesh computing and bandwidth backfill projects. This led to an interesting top-level result of overall enterprise mobility spend being fairly steady although the shape of the spend was quite different from the year before.

Cloud Failures Demonstrated need for Hybrid and Multi-Cloud Management – Although legacy computing had its issues, cloud computing had its black eyes as well. 8760 hours per year means that each hour down gets you from 100% to 99.99% (4 9’s). Recent Amazon failures in November and December of 2021 demonstrated the challenges of depending on overstressed resources, especially US-1-East. This is not meant to put all the blame on Amazon, as Microsoft Azure is known for its challenges in maintaining service uptime as well and Google Cloud still has a reputation for deprecating services. No one cloud vendor has been dependable at the “5 9’s” level of uptime (5 minutes per year of downtime) that used to define high-end IT quality. Cloud has changed the fundamental nature of IT from “rock-solid technology” to a new mode of experimental “good enough IT” where the quality and value of new technology can excuse some small uptime failures. But cloud failures by giants including Akamai, Amazon, AT&T, Comcast, Fastly, and every other cloud leader show the importance of having failover and continuity capabilities that are at least multi-region in nature for mission-critical technologies.

Multi-cloud Emergence – One of the interesting trends that Amalgam Insights noticed in our inquiries was that Google Cloud replaced Microsoft Azure as the #2 cloud for new projects behind the market leader Amazon. In general, there was interest in using the right cloud for the job. Also, the cloud failures of leading vendors allowed Oracle Cloud to start establishing a toehold as its networking and bare-metal support provided a ramp for mature enterprises seeking a path to the cloud. As I’ve been saying for a decade now, the cloud service provider market is going the way of the telcos, both in terms of the number of vendors and the size of the market. Public cloud is now is $350 billion global market, based on Amalgam Insights’ current estimates, which measures to less than 7% of the total global technology market. As we’ll cover in our predictions, there is massive room for growth in this market over the next decade.

SD-WAN continues to be a massive growth market – From a connectivity perspective, Software Defined Wide Area Networks (SD-WAN) continue to grow due to their combination of performance and cost-cutting. This market saw 40% growth in 2021 and now uses security as a differentiator to get past what people already know. From an IT cost management perspective, this means that there continues to be a need for holistic project management including financial and resource management for these network transformation projects. Without support from technology expense management solutions with strong network inventory capabilities, this won’t happen.

As we can see, there were a variety of key IT trends that affected technology expenses and sourcing in 2021. In our next blog on this topic, we’ll cover some of our expectations for 2022 based on these trends. If you’d like a sneak peek of our 2022 predictions, just email us at info@amalgaminsights.com