50% of organizations exceed their budgeted spend on cloud storage

Enterprises are going all-in on cloud storage, with average stored capacity in the public cloud expected to reach 43% of their total storage footprint by 2024, and the vast majority (84%) are increasing their budgets to make that a reality, according to Wasabi.

The survey seeks to uncover the changing attitudes toward public cloud storage adoption, the factors that influence storage buying decisions, and the top priorities when it comes to budget, use cases, security, and cloud data migration.

“The world is storing more capacity in the public cloud than ever before, and enterprises are adopting multiple cloud storage providers in an attempt to maximize both performance and cost efficiencies,” said Andrew Smith, senior manager of strategy and market intelligence at Wasabi Technologies.

“We also gathered important data to inform understanding of new trends: the fact that more than 50% of organizations exceed their budgeted spend on cloud storage; and that many struggle with security due to inadequate training and user experience with cloud storage,” added Smith.

Enterprises see the value of cloud storage over on-premises storage

• In the last year, 89% of enterprises migrated data from on-premises storage to the public cloud, and 84% of all respondents expect to increase the amount of data they store in the public cloud during 2023.
• More resilient infrastructure (42%), needing to scale (38%), and access to global locations (35%) were major factors driving migration from on-premises to cloud.
• 51% of respondents cited they use the public cloud to support their critical business applications, like enterprise resource planning and customer relationship management, as opposed to using the public cloud as a backup and archive repository (38% and 41%, respectively).
• When it comes to C-Suite decision makers, 48% cited better performance of cloud over on-premises storage as the top factor driving the migration.

Organizations are increasing public cloud storage budget

• 84% of respondents expect to increase their public cloud storage spend in the next year.
• The leading factors of this increase are IT initiatives like infrastructure migration (56%), business initiatives like digital transformation (45%), and new data security initiatives, including backup/data recovery (44%).
• Although there is willingness to invest in cloud storage, 52% of respondents exceeded their previous year’s budget, primarily due to fees charged by their cloud storage vendor, including data operations, egress fees and API requests.
• In fact, understanding their cloud storage bill was the number one challenge associated with cloud storage migration (40%).
• The survey data also sheds light on one of the industry’s unfortunate truths: A large proportion of storage bills are allocated to various fees. Specifically, respondents said storage fees account for 48% of their total cloud storage bill on average.

“Today’s enterprises are required to be agile, and the insights gained from data lend a competitive advantage,” said Smith. “However, while the perceived value of enterprise data might be limitless, storing and accessing that data, on the other hand, has a very real cost. Unfortunately, the complexity and uncertainty of storage fees are major factors which led more than half of organizations to exceed their cloud storage budget in 2022. This highlights a significant pain point for enterprises, and an opportunity to improve as they assess cloud storage spending for 2023.”