Where the Enterprise is Headed

Think Microsoft's and AWS' Collective Influence on the Enterprise has Waned? The Tattooine Two-Sun Solar System Continues...

Thomas DelVecchio | ETR Research | follow @ETRNews on twitter

| March 13, 2019

We launched the Spring Pulse Check Survey this past Friday to the 1,083 original respondents of January's Technology Spending Intentions Survey. Since Friday, over 600 CIOs and other high-level ITDMs (IT decision makers) have already participated and therefore, updated their 2019 spending intentions (versus their actual 2018 spend). 

One thing is already very clear, Microsoft and AWS have not let go of their vice grip on the enterprise. There are 591 vendor-sector combinations in our survey universe. Of those 591 vendor-sector combinations, 289 already have at least 30 respondent citations. If we rank or sort these 289 statistically significant vendor-sector combinations by highest to lowest Net scores (Net score = (Adoption % + Increase %) - (Decrease % + Replacing %), and isolate to the top 10% - or in other words - of the Top 29 vendor-sector combinations with 30 citations or greater, more than half are either a Microsoft or AWS offering (16 of the 29). And this is not simply a case of two pervasive 800lbs. gorilla-like vendors absorbing 'Increase' responses from survey respondents, as the average Adoption percentage among these 16 Microsoft and AWS vendor-sector combinations is 21%... meaning 21% or essentially a fifth of all respondents that cited Microsoft and/or AWS are indicating its a NEW adoption of the vendor in that sector (i.e. new biz). Furthermore, a great deal of these high flying Net scores are found in either the Cloud Computing or Container Orchestration sectors. This tells us that Microsoft's and AWS' grips on the enterprise are only getting tighter.

Its almost as if this whole data thang we've got going over here can accurately predict what will occur in enterprise tech. Why do I say that you ask? Below is the cover image and a passage from our 10,000' View from 2 years ago (July 2017), which was entitled Enterprise Tech Transforms into a Two-Sun Solar System...

"...a tectonic shift has already occurred and will continue to widen as the enterprise is now living within a two-sun or dual-heliocentric model, orbiting around Amazon Web Services and Microsoft. Make no mistake, battles lines are being drawn and vendors are pairing off. We yet again reiterate our high-level thesis since April 2016…

…public cloud’s increasing pervasion will lead to the disintermediation of pure-play software vendors with greater velocity. Technological leads will continue to compress to a point where the added cost can no longer be justified.

…once AWS and/or Microsoft decide they want to throw their hats into that ring, they’ll undercut the innovators and disruptors on pricing while pitching homogeneity and security as they feverishly produce new iterations nearly weekly until the competitive distance compresses to a point where cost becomes the only glaring criteria for the buyer.”

We also stated in that very same 10,000' View, "...the Fortune 500 has indicated that a greater percentage of its public cloud spend in 3 years will go to Microsoft Azure than to Amazon Web Services (PaaS and IaaS spend, not SaaS)." And that seems to be well on its way to becoming a reality as well, two years into that three year forecast.

Amazing what one can find when one shuts up and listens... to the data. See F5 Networks acquisition of NGINX? Came as as a shock to many. Not us. NGINX was highlighted as Potential Threat / Possible Acquisition Target on page 15 of our F5 Networks report in January due to customer overlap and the direction of shared customers' spend on the respective vendors.

Super omnia notitia. -TD