The Great Cloud Reset

Build And Deploy Workloads Where They Run

Best To The Delight Of Users And The Business

A FORRESTER CONSULTING THOUGHT LEADERSHIP PAPER COMMISSIONED BY AKAMAI, JUNE 2023

Table Of Contents
3 Executive Summary

4 Key Findings

5 Competing Today Requires Core To Edge Optimization

9 The State Of Multicloud Today Is Far From Optimized

12 Multicloud Maturity Requires Building And Deploying

Workloads Where They’ll Run Best

15 Key Recommendations

16 Appendix

Project Team:
Mandy Polacek,
Senior Market Impact Consultant

Britt Mountford,
Market Impact Consultant

Andrea Mendez Otero,

Associate Market Impact Consultant

Contributing Research:
Forrester’s Infrastructure And Operations
research group

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THE GREAT CLOUD RESET 2

Executive Summary
Low latency and proximity to customers is critical to winning in business
today. Why? In media and gaming, users expect zero downtime. In retail,
customers expect convenient, seamless shopping experiences across digital
and in-store channels. In financial services, where trust is paramount to
success, customers expect easy and secure access to their accounts and
up-to-date information. As all industries face performance pressures, modern
applications are pushing the limits of public cloud infrastructure.

In February 2023, Akamai commissioned Forrester Consulting to evaluate

the state of cloud adoption and evolution to meet business and user
requirements. Forrester conducted an online survey with 420 enterprise
cloud strategy leaders across the globe to explore this topic. We found
that as region-based cloud architectures struggle to meet today’s business
needs, companies are responding by embracing cloud-to-edge architecture
that prioritizes deploying software where it runs best, minimizing latency and
optimizing performance.

THE GREAT CLOUD RESET 3

Key Findings

Latency concerns increase as workloads spread out. Roughly

nine out of 10 respondents report that six or more of their
company’s workloads need to run in multiple regions and that as
many workloads use IoT devices and content delivery networks
(CDNs). As workloads spread out, latency was a top concern.

Localization is a key priority and challenge. Two-thirds of

respondents report that six or more workloads need to run in
multiple jurisdictions, yet 41% of respondents struggle to find a
provider to meet data residency requirements.

Companies that prioritize low latency applications are shifting

to cloud-native architectures and building and deploying
applications at the core and edge. Multicloud is the reality for
all respondents. Today, that looks like investing in a cloud-native
future by building and deploying applications across multiple
clouds and at the core and the edge. Seventy-five percent of
respondents report their companies deploy applications on public
cloud, and 76% report they deploy applications at the edge.

Multicloud maturity will require choosing the right cloud for

the right workload and investing in flexible architecture and
partners. Seventy-six percent of respondents agree they must
align the right workload to the right cloud to optimize their
multicloud strategies and overcome their latency and localization
concerns. They expect that doing this well will result in benefits to
the business and the people it serves (customers and employees).

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Competing Today Requires Core To Edge Optimization

Cloud has created a rising curve of user and customer expectations for
application software: 80% of this study’s respondents agree that more
user experiences are dependent on cloud than ever before. Yet cloud-only
infrastructure presents price/performance issues at scale. In surveying 420
enterprise cloud strategy leaders, we found that:

• Cloud is critical to business. Eighty-six percent of respondents agree

their businesses are more reliant on the cloud than ever before.
Specifically, 80% of respondents report that the majority of their
companies’ applications were architected for the cloud native, and 93%
of respondents say the majority of applications will be built specifically
for the cloud in the next 12 months (see Figure 1). Unsurprisingly, all
respondents report they work with multiple cloud providers today, with
North America taking the lead — 21% of North American respondents say
their companies work with four or more cloud providers; half as many
respondents in other regions report the same (see Figure 2). Cloud is
critical to business and multicloud is the reality for all companies today.

Figure 1
Number Of Cloud-Native Applications
21% to 30% 31% to 40% 41% to 50% 51% to 60% 61% to 70% 71% to 80% 81% to 90%

80% 1%
93% 0%
are mostly expect to be mostly
cloud native 3% cloud native in the 1%
today. 16% next 12 months. 6%
23% 15%
37% 26%
17% 31%
3% 21%

Base: 420 global enterprise cloud decision-makers at the director level or higher
Source: A commissioned study conducted by Forrester Consulting on behalf of Akamai, March 2023

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Figure 2
“How many cloud providers is your organization working with today?”
Europe North America Latin America Asia Pacific and Japan

31%
34%
Two 33%
35%

58%
46%
Three 56%
53%

10%
20%
Four 11%
12%

1%
1%
Five or more 0%
0%

Base: 420 global enterprise cloud decision-makers at the director level or higher
Source: A commissioned study conducted by Forrester Consulting on behalf of Akamai, March 2023

• Demand is spiking for both core and edge capabilities. Seventy-five

percent of respondents report they deploy applications on public cloud,
and 76% report they deploy applications at the edge — which includes
those who selected deployment via content delivery networks and/or
edge platforms. Regarding specific use cases, respondents report relying
on cloud providers for infrastructure fundamentals such as storage
(73%) and databases (67%), as well as new and specialized capabilities,
including application security (31%), AI/ML (22%), and application
development (16%) (see Figure 3).

• Latency concerns increase as workloads spread out. Eighty-eight

percent of respondents report that six or more of their company’s
workloads need to run in multiple regions. Some 72% of respondents
say they’re running six or more workloads at the edge, 93% say that
six or more of their applications use CDNs, and 92% say six or more of
their workloads use IoT devices. This reality highlights the criticality of
distributed compute capacity to reduce latency. Industries that win by
tracking and improving in-person and online experiences, like retail, are
even heavier adopters of edge and IoT (e.g., 100% of retail respondents
report that six or more of their workloads use IoT devices).

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Figure 3
“Where does your organization deploy public-facing web applications?”

75% 52% 45% 26%

Public cloud Content delivery network Edge platform On-premises

“Which of the following does your organization rely on its cloud provider(s) for?”

Storage 73%

Databases 67%

Virtual machines 58%

Enterprise software as a service (SaaS) 55%

High-performance computing (HPC) 43%

Containers 38%

Web/content hosting 36%

Enterprise application hosting 35%

Serverless/function as a service (FaaS) 34%

Application security 31%

Application delivery controller (ADC) 23%

AI/ML 22%

Application development 16%

Base: 420 global enterprise cloud decision-makers at the director level or higher
Source: A commissioned study conducted by Forrester Consulting on behalf of Akamai, March 2023

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• Localization is a priority. Cloud usage must adapt to various regulatory
requirements. Some 66% of respondents report that six or more
workloads need to run in multiple jurisdictions, highlighting the
importance of cloud-to-edge architecture. Data localization is especially
important in Europe, where 76% of respondents report that six or more
workloads need to run in multiple jurisdictions (see Figure 4).

Figure 4
Workloads Requirements WORKLOADS ARE SPREADING OUT
1 to 5

6 to 10 Number of workloads that need to run

in more than one cloud provider region
11 to 15 11% 40% 28% 15% 5%
16 to 20
21 or more

Number of workloads running at the edge

27% 41% 24% 7% 0%

Number of workloads applications

that use CNDs
3% 40% 33% 17% 3%

100% Number of workloads that use IoT devices

of retail respondents report
5% 22% 43% 27% 3%
that six or more of their
workloads use IoT devices.

LOCALIZATION IS A PRIORITY
76%
Workloads that need to run in of European respondents report
multiple jurisdictions that six or more workloads need
35% 45% 15% 4% 2%
to run in multiple jurisdictions.

Base: 420 global enterprise cloud decision-makers at the director level or higher
Note: Percentages may not total 100 because of rounding.
Source: A commissioned study conducted by Forrester Consulting on behalf of Akamai, March 2023

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The State Of Multicloud Today Is Far From Optimized

While companies are embracing cloud and edge to improve their speed and
agility and take advantage of new capabilities, the challenges of working
with multiple cloud providers have not gone away. In this study, we found
that companies fail to meet the requirements respondents report they care
most about in the current state of multicloud. Specifically, we found that:

• Complexity and cost are key pain points. Complexity is inherent to

multicloud strategies, especially when it comes to integration, scaling,
and the maintenance of multiple providers. This was the number one
challenge cited by 51% of respondents. The second biggest challenge,
which is in some ways related, is costs (44%) associated with sprawl,
data egress charges, and unpredictable pricing. Latin America feels
that complexity most deeply (60%) as a region that’s been historically
underserved by cloud providers but has undergone immense
transformation in recent years. These Latin American organizations face
increased complexity because they’re earlier in their cloud journeys,
but they are catching up quickly. Related to addressing complexity is a
top three challenge unique to Asia Pacific respondents: a shortage of
internal skills (51%).

• Workload placement is suboptimal. Respondents are relying on

cloud providers for more workloads across more environments than
ever before. Yet the architectural and operational considerations for
public cloud regions can result in suboptimal workload placement. As
previously highlighted, latency and localization
are key priorities. They are also key challenges: A top challenge for gaming
41% of respondents struggle to find a provider industry respondents
to meet data residency requirements, and high (52%) is that decisions on
latency was a top concern across almost all where to place workloads
cloud provider use cases. Fifty-two percent
are being determined by
of respondents in the gaming industry also
regulatory requirements
reported frustrations that decisions on where
to place workloads are dictated by regulatory and not by what makes
requirements and not what makes the most the most sense for
sense for the use case (see Figures 5). the workload.

THE GREAT CLOUD RESET 9

Figure 5
Top Multicloud Challenges*

51% Complexity issues are

Overly complex (e.g., difficult to felt most deeply in
integrate, scale, maintain, etc.) Latin America (60%)

44%
Increased costs of multicloud

41% A shortage of internal

Finding a provider to meet data skills is a top 3 challenge
residency/sovereignty requirements in Asia Pacific (51%)

Latency Is A Top Challenge Across Use Cases

Serverless/function as a service (FaaS) 57%

AI/ML 55%

Web/content hosting 52%

Storage 49%

Virtual machines 47%

Enterprise application hosting 45%

Databases 44%

Application development 39%

Enterprise software as a service (SaaS) 39%

Application security 38%

Containers 38%

High-performance computing (HPC) 36%

Application delivery controller (ADC) 29%

Base: 420 global enterprise cloud decision-makers at the director level or higher
*Note: Top three of eight responses shown
Source: A commissioned study conducted by Forrester Consulting on behalf of Akamai, March 2023

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• As a result, companies are facing inefficiencies, churn, and losing their
competitive edge. Multicloud complexities have resulted in inefficiencies
for 46% of respondents. As cloud and edge promise new and
differentiated capabilities for companies and their people, poorly planned
multicloud strategies can do just the opposite, resulting in increased
churn among employees (38%) and customers (24%) and decreased
competitive advantage (33%) (see Figure 6).

Figure 6
“Which of the following has your organization experienced due
to the multicloud challenges it has faced?”

46% 38% 33% 29%

Decreased efficiency Increased Decreased competitive Poor revenue
employee churn advantage performance

24% 19% 4%
Increased Reduced innovation Don't know/does not
customer churn apply

Base: 420 global enterprise cloud decision-makers at the director level or higher
Source: A commissioned study conducted by Forrester Consulting on behalf of Akamai, March 2023

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Multicloud Maturity Requires Building And Deploying Workloads
Where They’ll Run Best

A growing number of companies have concluded Figure 7

that multicloud is the right strategy. Their next
Strongly agree Agree
step: develop a cloud architecture that includes
the edge to optimize cloud usage. Organizations 41% 35%
can meet that objective by choosing the right 76% of respondents agree that
cloud for the right workload — a notion that 76% multicloud optimization requires
that they choose the right cloud for
of respondents in this study agree with. Regarding
the right workload.
doing this successfully, we found:

• Strategies must include flexible partners and

architecture. A company’s ability to choose the “How important are the
right cloud for the right workload will be limited following to optimizing
if it doesn’t have the supporting architecture your organization's
and partners in place. Respondents agree multicloud strategy?”*
that flexible architecture that includes the (Showing “Critical” and
edge (86%) and cloud providers that support “Important” responses)
workloads across a range of cloud and edge Flexible cloud architecture that
environments (65%) are key to optimizing their includes the edge

multicloud strategies. The ability to support 86%

workloads across cloud and edge is especially
important to Asia Pacific respondents (75%) Engaging cloud providers that support
workloads across a range of cloud
(see Figure 7). and edge environments

• Trust, reliability, and the capability to meet 65%

current and future needs are top partner
requirements. Strategic multicloud will require
strategic partners as companies work on The ability to support workloads
aligning the right workloads with the right across cloud and edge is
environment. Trust is therefore paramount especially important to Asia
when engaging providers — choosing a Pacific respondents (75%)
trusted partner is important or critical for 85%
of respondents. To deploy workloads where Base: 420 global enterprise cloud
decision-makers at the director level or higher
they’ll run best, respondents also require *Note: Showing top two responses
partner reliability (88%), scalability (80%), and Source: A commissioned study conducted
by Forrester Consulting on behalf of Akamai,
capabilities at the edge (78%). Capabilities at March 2023

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 the edge is again the most critical factor to Regarding trust, working
respondents in Asia Pacific. Regarding trust, with a known partner
working with a known partner is most critical to
is most critical to
respondents in EMEA (see Figure 8).
respondents in Europe
Figure 8 (47% see it as critical)
“What is important to your organization
when engaging a cloud provider?”
Critical Important

Reliability 37% 51% 88%

Working with someone known/a

38% 47% 85%
trusted partner
Scalability across the globe, including in
37% 43% 80%
underserved markets
Availability of a variety of compute, network,
36% 42% 78%
and data platforms and/or services at the edge
Including support services without
31% 45% 76%
additional cost
Ability to meet stringent data
33% 43% 75%
residency requirements

Simple and predictable pricing 30% 43% 72%

Supporting a range of application

35% 34% 70%
development tools
Base: 420 global enterprise cloud decision-makers at the director level or higher
Note: Showing top 8 responses; total percentages may not equal separate values due to rounding
Source: A commissioned study conducted by Forrester Consulting on behalf of Akamai, March 2023

• A more strategic workload alignment will

drive business and user benefits. Respondents Capabilities at the edge
expect that aligning the right cloud to the right are the most critical to
workload and engaging partners to meet their
respondents in Asia
flexible requirements will yield positive results,
including increased revenue (68%), improved Pacific (47% see it as
user experiences (64%), improved performance critical)
(68%), and cost optimization (65%). These
benefits ring true in all markets, with improved
user experience being especially important in

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 Latin America (73%), which makes sense given the
rise of software development talent the region 80%
has seen in recent years. Gaming respondents, of gaming respondents
who represent the most latency-sensitive industry
report improved
of all, report improved performance as their top
benefit (80%) (see Figure 9). performance as their
top benefit.
Figure 9
“What benefits have you seen/do you
“What benefits have you seen/do you expect to see from engaging a cloud
expect to see from strategically aligning provider that supports workloads across a
the right cloud to the right workloads?” range of cloud and edge environments?”
Improved performance

68%

Cloud spend optimization

68%
65% Increased
revenue
Increased revenue

59% 64%
Improved user
experience
Improved user experience

58% 55%
Improved
reliability
Lower latency

52%
48%
Reduced costs
Accelerated innovation

49%
45%
Accelerated
Risk mitigation innovation
43%

73%
Increased competitive differentiation Improved UX is most
42% important in Latin America.

Base: 420 global enterprise cloud decision-makers at the director level or higher
Source: A commissioned study conducted by Forrester Consulting on behalf of Akamai, March 2023

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 Key Recommendations
As companies commit to cloud-native architectures, they must also commit to
building and deploying applications where they run best to overcome security
and performance limitations.

Forrester’s in-depth survey yielded several important recommendations:

Accelerate cloud-native adoption.

Cloud native is the new normal. The cloud-native ecosystem is essential to

creating infrastructure that can work with any cloud.

Architect to embrace multicloud cost-effectively.

Public cloud offers scale and power, but it often imposes unnecessary costs
and management overhead to move data from one provider to another. Avoid
these traps by architecting cloud networks and edge infrastructure to allow for
portability and flexible deployment rather than contorting workload placement
to adapt to cloud costs.

Optimize cloud for user and employee experience with edge.

Cloud loses its power if latency inhibits performance for key applications
closest to users and employees. Move latency-sensitive workloads to the
edge to take advantage of new, more powerful edge infrastructure.

Leverage edge to meet requirements for data sovereignty and security.

Regulators in many parts of the world prohibit data from leaving their
jurisdictions. A centralized approach to cloud can make it difficult for users to
comply without sacrificing performance. An edge-capable multicloud strategy
can bring a full array of cloud services to locations where data sovereignty
is paramount.

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Appendix

Appendix A: Methodology
In this study, Forrester conducted an online survey of 420 global enterprise cloud strategy decision-
makers to evaluate the state of cloud and edge adoption to meet business and user requirements. Survey
participants included decision-makers in IT and operations roles. Questions provided to the participants
asked about their companies’ cloud and edge adoption, multicloud challenges, and plans to modernize their
technology, operations, and provider relationships. Respondents were offered a small incentive as a thank
you for time spent on the survey. The study was conducted in a double-blind fashion. It began in February
2023 and was completed in March 2023.

Appendix B: Demographics
COUNTRY INDUSTRY (TOP 10)
Brazil 11% Technology and/or technology
17%
services
Canada 10%
Gaming 12%
China 9%
Media and/or leisure 12%
France 7%
Retail 12%
Germany 8%
Manufacturing and materials 5%
India 16%
Financial services and/or insurance 5%
Mexico 13%
Telecommunications services 4%
United Kingdom 10%
Consumer product goods and/or
United States 15% 4%
manufacturing
Transportation and logistics 4%
ANNUAL REVENUE
Education and/or nonprofits 3%
$500M to $999M 64%

$1B to $5B 35% DEPARTMENT

>$5B 1% IT 65%

Operations 35%
RESPONDENT LEVEL
C-level executive 15% ENTERPRISE COULD STRATEGY
Vice president 34% RESPONSIBILITY

Director 52% Final decision-maker 51%

Influence decisions as a primary

49%
part of job
Note: Percentages may not total 100 due to rounding.

Appendix C: Supplemental Material

RELATED FORRESTER RESEARCH

“Assess The Pain-Gain Tradeoff Of Multicloud Strategies,” Forrester Research, Inc., August 29, 2022.
“The Future Of Edge Computing,” Forrester Research, Inc., May 11, 2022.

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