The past 12 months have seen the runners and riders of the cloud market rocked by economic uncertainty, which in some cases has led to some notably downbeat financial results being reported as enterprise users looked to scale back their cloud use for money-saving reasons.
At the same time, the government’s cloud strategy has come under scrutiny for failing to do enough to encourage public sector organisations to use homegrown providers over the US-based hyperscalers, in the wake of the news that one UK-based provider has gone out of business as a result.
The chokehold the hyperscalers have on the public cloud market continues to cause problems for other providers too, as they have sought to switch-up their customer acquisition strategies or find other ways to raise money in the face of dwindling demand.
Against this backdrop, here are Computer Weekly’s top 10 cloud stories of 2022.
1. UKCloud secures funding lifeline to ease cashflow concerns
The backend of 2021 brought the news that all might not be well, financially, at public sector-focused cloud provider UKCloud, after Computer Weekly learned the Cabinet Office had been warning users of its services to shift their workloads onto alternative clouds out of concern the firm might be about to collapse.
This was on the back of a Companies House filing that confirmed the company was in need of a £30m funding lifeline to continue trading. In January 2022, the company moved to assure its customers that its future was assured, following the news that it had been acquired.
2. UKCloud collapses after being hit with winding up order
Several months after its acquisition, news emerged in October 2022 that UKCloud had hit the skids after being hit with a winding up order, resulting in it being placed in compulsory liquidation.
As previously documented by Computer Weekly, the firm had seen its offerings fall out of favour with public sector IT buyers since the opening of UK datacentres by the likes of Amazon Web Services (AWS) and Microsoft. This seemed to decimate UKCloud’s unique selling point, which was that it could provide buyers with access to sovereign cloud services.
3. The hyperscalers set out sovereign cloud services vision
Having established a local presence in the UK, many of the hyperscalers – namely Microsoft and Google – have also taken steps to up the level of protection they can offer their customers and their data by launching sovereign cloud services for their users.
Google outlined its sovereign cloud strategy in October 2022, which will see it partner with local cloud providers in various European countries, while Microsoft will host its take on sovereign cloud services within its existing Azure datacentres.
4. Rackspace mulls over and then decides against selling off its business units
May 2022 brought the news that it could be all change again at managed cloud provider Rackspace, following the admission of its CEO, Kevin Jones, that discussions were being held internally at the company about the prospect of selling off at least one of its business units.
News of the prospective sale came less than two years after Rackspace became a publicly traded company again, after its acquisition by private equity house Apollo Global Management in 2016 saw it withdraw from the stock exchange.
Several months later came the news that Rackspace had decided against divesting any parts of the company, and that it would continue operating on a business as usual basis.
5. Revenue growth slows at AWS
The third-quarter results from Amazon Web Services raised eyebrows in October 2022 after they revealed the public cloud giant’s revenue growth had dropped markedly year on year (YoY), with the firm reporting its lowest annual revenue growth figure since records began.
AWS reported a YoY revenue growth figure of 27.5%, down from 33% the previous quarter, with the company attributing its downbeat performance to enterprises scaling back their cloud spending in the face of economic uncertainty.
6. OVHCloud counts legal cost of 2021 datacentre fire
French cloud infrastructure provider OVHCloud made headlines in 2021 after its Strasbourg datacentre campus experienced a fire, which completely gutted one of the site’s server farms.
It emerged this year the company is now facing legal action from disgruntled customers who lost data and whose business operations were majorly disrupted as a result of the fire.
Initially, it emerged that 70 customers had joined the group action, but in May 2022 this number had doubled to 140 who were – it was confirmed – collectively pursuing damages from OVHCloud in excess of €10m.
7. Google Cloud’s revenue and market share figures are on the up
While making a profit continues to allude Google Cloud, the public cloud giant has seen an uptick in market share and revenue growth over the course of successive quarters during 2022, and has signed a slew of multi-year cloud deals with household names.
The firm continues to trail behind second place Microsoft and public cloud market leader Amazon Web Services (AWS), but analysts are of the view that – with a couple of tweaks to its cloud strategy – it will continue to prove to be more than a match for what its public cloud rivals have to offer.
8. AWS doubles-down on datacentre sustainability with water and e-waste reuse pledges
The steps that cloud providers are taking to minimise the environmental impact of their activities has remained a recurring source of news stories throughout 2022, with Amazon Web Services – as the world’s biggest cloud company – having to do more than most to prove its sustainability credentials.
As such, this year has seen the firm set out plans to become the world’s “cleanest cloud” and make a commitment to becoming a water-positive entity by 2030. Also during its February 2022 financial results, AWS revealed that it was planning to extend the useful life of the servers and networking equipment in its datacentres from four years to five to reduce its e-waste levels.
9. Rackspace suffers ransomware attack
Rounding out the year, Rackspace made headlines again when it suffered a ransomware-related outage that left users of its hosted Microsoft Exchange offering unable to access their emails through the Outlook Web App.
The incident prompted the managed cloud provider to migrate its affected customers over to the cloud-based Microsoft Office 365 productivity platform as a stopgap until it was in a position to restore the affected, hosted Microsoft Exchange environment.
10. Microsoft 365 banned in German schools over data privacy concerns
In late November 2022, it emerged that German data protection authorities had banned schools in the country from using Microsoft Office 365 due to an alleged lack of transparency around how Microsoft collects and process personal data and the potential for third parties to access it.
“Microsoft does not fully disclose which processing operations take place in detail. In addition, Microsoft does not fully disclose which processing operations are carried out on behalf of the customer or which are carried out for its own purposes,” the data protection authorities claimed.
Microsoft, meanwhile, has contested the ban, claiming it is still possible for German schools to use the platform in a legally compliant manner and that its product “not only meet, but often exceed, the strict EU data protection laws”.
…. to be continued
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