84% Asian Cloud Users Plan Full Migration to Cloud in Next Two Years

Alibaba Cloud

According to a new survey report commissioned by Alibaba Cloud, 84% of existing users of cloud services in Asia are planning to fully migrate to the cloud within the next two years. The report, titled ‘The Next-Generation Cloud Strategy in Asia,’ also revealed that more than four in five of the surveyed businesses plan to increase their investment in cloud technology in 2023.

To better grasp the level of usage of the prevalent cloud methods – private, public, and hybrid – across Asia, Alibaba Cloud hired global market research company NielsenIQ to carry out this survey.

The increased investment in the cloud is expected to come from countries such as Thailand, Indonesia, the Philippines, Hong Kong, and Singapore, with the gaming sector projected to see the sharpest increase in cloud investment, followed by Media & Telecommunications, Internet & Technology, and Financial Services.

The increase will most likely come from Thailand (95%), Indonesia (94%), the Philippines (91%), Hong Kong Special Administrative Region (S.A.R.) (83%), and Singapore (83%), while a larger percentage of the surveyed companies in Japan and South Korea indicate that they will maintain their current levels of investment. Among the main industries, the gaming sector is expected to see the largest increase in cloud expenditure, followed by media & telecommunications, internet & technology, and financial services.

In terms of financing goals, businesses in Asia will focus more on automation (46%), cloud computing (52%), and data analytics & AI (53%). The fact that more than half of businesses plan to increase their expenditure on cloud computing shows how essential cloud technology is to promoting business growth.

“The latest research reveals important insights for businesses and cloud services providers in Asia,” said Selina Yuan, Vice President of Alibaba Group and President of International Business for Alibaba Cloud Intelligence. “Cloud adoption has become a prerequisite for businesses to succeed and our customers are adopting a diverse cloud strategy to drive business growth in the digital era. With cloud infrastructure being the ultimate foundation for many cutting-edge innovations such as generative AI, we are as committed as ever to providing proven cloud-based solutions for businesses in different industries and supporting their seamless migration to the cloud services.”

COVID-19 Impact

Selina Yuan, VP of Alibaba Group and President of International Business for Alibaba Cloud Intelligence
“The latest research reveals important insights for businesses and cloud services providers in Asia,” said Selina Yuan, VP of Alibaba Group and President of International Business for Alibaba Cloud Intelligence.

Only one in five (20%) companies in Hong Kong S.A.R., Japan, and Singapore are less than three years experienced with cloud services, despite the fact that more than two-thirds (69%) of all businesses polled have used cloud for at least three years. The most cloud-mature industries are Internet & Technology, Manufacturing, and Financial Services.

The study also shows that 84% of the companies questioned anticipate completing their migration to the cloud within the next two years, in part due to new requirements created by the epidemic. In fact, 36% of respondents say they plan to completely migrate to the cloud in the upcoming six months.

The effect of COVID-19 on the companies questioned has significantly altered how they use IT, with 54% reporting greater use of cloud-based applications and 41% reporting accelerated cloud transfer.

Strategy Towards More Diverse Cloud Adoption

Private cloud (40%) was the most common approach in Asia at the time of the study, followed by public cloud (27%). The main reasons for businesses to choose public cloud are its strong reputation for security, dependable local support, and appealing pricing, with 38% of questioned companies anticipating to increase expenditure by more than one fifth in the future year.

South Korea has the largest percentage of public cloud usage (43%) among the Asian countries evaluated. Gaming, the public sector, retail, and internet and technology are the top industries presently utilizing public cloud.

Meanwhile, hybrid cloud usage is increasing, with a 7 percentage-point net gain in present adoption rate compared to respondents’ original cloud strategy adoption, according to the study. Furthermore, the largest percentage of respondents who have altered their cloud approach, 39%, have moved to mixed cloud. Aside from security, companies prefer mixed cloud for tailored cloud services.

“The variety of cloud strategies adopted in Asia indicates that more businesses are looking for robust, resilient, secure and flexible infrastructures to digitalize their business,” added Yuan. As a leading provider of cloud services, we will continue to introduce innovative and secure public cloud services to satisfy this demand.”

About the Survey

Alibaba Cloud’s survey was conducted between the end of September and early October 2022, collecting feedback through online questionnaires from 1,000 cloud strategy decision-makers in small to large-sized businesses that are currently using cloud services in eight markets in Asia: Hong Kong S.A.R., Malaysia, Singapore, the Philippines, Indonesia, Thailand, Japan and South Korea.

Financial services, gaming, Internet and technology, manufacturing, media and telecommunications, the public sector, and retail were just a few of the many sectors covered by the interviewees.