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St Petersburg information technologies

Cloud accelerator

The cloud market proved to be one of the most successful IT segments during the pandemic, but it only maintained its previous growth rate.

iKS-Consulting previously suggests that the Russian cloud market will rise to 100 billion rubles or 1.4 billion $ by the end of 2020. Thus, it will add a little less than 20% over the year - a significant figure when compared, for example, with telecom which went into deficit by the end of the year. Nevertheless, the players in this segment are not so optimistic, because a year earlier the market turnover increased by more than 21%. Thus, so far for cloud services, although the pandemic has not become a serious threat, it has not contributed to growth, contrary to the forecasts of many experts. Nevertheless, market participants are confident that the profound structural changes that have taken place in business under the influence of the "coronacrisis" will generate sustained demand for their services.

The external stimulus

Alexander Tugov, Director of Service Development at infrastructure provider Selectel, calls the epidemic and global quarantine the main accelerator of the cloud market in the past year: "Because of them, businesses were forced to move from offline to online or die. Architecturally, any online service is based on cloud infrastructure in one way or another. As a result, we can see cloud large increase from new customers who, before the lockdown, had never even considered going online.
In particular, the company attributes growing demand for cloud conferencing, desktops (DaaS), virtual boards, software development and project management tools in the cloud to the pandemic. "The active use of these services has shown companies that there is no need to invest in their own infrastructure by buying it outright," specified Alexander Tugov.

"Even conservative companies have begun to turn to cloud services for business against this background. On the one hand, some of them perceived this as a temporary phenomenon and plan to return to the previous mode after the pandemic is over. On the other hand, many have appreciated the flexibility of pricing in the cloud market: services with monthly payments allow companies to avoid capital investments in IT and adapt to changes in the economy," adds DataLine CEO Yury Samoilov (Rostelecom Data Center).

At the same time, a number of players showed more significant growth than the market average. Selectel grew by more than 40% by the end of 2020. MTS recorded a twofold increase in demand for cloud solutions: according to the company, in St. Petersburg the peak came in the middle of the first half of the year, when business faced the need to quickly organise remote work. At the same time, more than 60% of corporate users of the MTS cloud in St. Petersburg are representatives of large businesses, among which infrastructure services are especially in demand.

Lockdown and mass remote work also led to some other changes. "2020 has changed the structure of the company's clients: we have recorded an outflow or optimisation of small business, the basis of which was offline," said Igor Sitnikov, CEO of Miran. However, in contrast, there was a noticeable growth in the number of companies providing online services, cloud computing, gaming platforms and social media. Naturally, it was caused by lockdowns and a massive shift to remote work.

Responding to the challenge

Like many representatives of other industries, data-centres, IT-service providers and cloud providers had to adjust to the new realities and transformed demand. "We launched a number of special anti-crisis offers for infrastructure, introduced favourable terms for data backup and storage services, services for organizing remote work," said Evgeny Svidersky, Director of Cloud Business Project Solutions at MTS. - This gave companies an opportunity to use cloud solutions on favourable terms that is especially important in challenging economic conditions.

"The anti-crisis offers mainly affected the tools for remote work," specifies Yury Samoilov. - In spring 2020, companies had to switch to a new mode of interaction with employees as quickly as possible, so we opened free access to solutions for secure remote work for a month: virtual desktops based on Citrix VDI, cloud drive, Workspad mobile workstation and scanning IT systems for security vulnerabilities".

According to the expert, these anti-crisis offers allowed many companies to think about security in a situation where the corporate network perimeter is no longer limited to the physical boundaries of the office: "At the beginning of the pandemic, this led to a threefold increase in the volume of resources ordered. It enabled us to meet new customer needs and redesign several services in terms of security and convenience. Thus, over the year we released a web application security service based on the web application firewall and added more security management capabilities to virtual desktops."
"Miran also launched IaaS promotions for SMB [Small and Medium-Sized Businesses-editor], but, as Igor Sitnikov noted, small businesses were not up to discounts, and the result didn’t live up expectations. Other actions were more effective. "In 2020, as is traditional in a crisis, we started to make the new phases of the Miran-2 data centre, which will allow us to double our capacity. The company's portfolio of services didn’t change significantly, we practically filled our own capacity by 100%, and for the new Miran-2 queues we offered pre-order services with a large discount and by the end of the year we had already signed a number of contracts," said Igor Sitnikov.

High expectations

iKS-Consulting is optimistic about the future of the cloud market: according to analysts' forecasts, the average annual growth rate over the next four years will remain at 20.1%. Market players are also hopeful about this. Alexander Tugov is convinced: "Users will stay online because they have already tried remote work, training and home delivery of everything possible. This means that online business will grow, and with it the cloud”.

The driver, according to the expert, will be the recently formed regulatory framework for remote work: "All that remains is to take care of telemedicine and you won't have to leave your home at all! The telemedicine market is potentially huge and almost empty, and therefore very interesting for cloud providers.

Yuri Samoilov agrees with the forecasts: services for organising remote work will remain in demand. In particular, this applies to virtual desktops - many companies assessed their capabilities and now they are planning to save the remote work options in one form or another.

"The data centre market will also grow at the expense of both the capital and the regions. In this context, we see our task as creating an ecosystem with a uniform level of service for all regional customers. Customers' requirements to the level of service will grow, and it is important to ensure uniform standards regardless of the physical location of the data centre," adds Yury Samoilov. - The demand for competitive import-substituting IaaS and PaaS services will also grow. Already now we see interest in fully Russian cloud solutions, for example in virtual infrastructure based on OpenStack from Tionix.

Not only classic infrastructure, but also private and hybrid cloud environments will be in demand, MTS is confident. "We forecast that 2021 will be the year of even deeper integration of cloud technologies into the business processes of companies and government agencies. Demand will remain at the same level, 20-25%, and in some areas - trade, finance, services - it will show even more impressive growth," says Evgeny Svidersky.

Evgeny Svidersky sees another trend in the transformation of the very approach to service provision - in addition to a set of standard services, companies need a high degree of customisation and an individual approach. In addition, as the volume of generated data increases, big data analytics becomes even more important. "Most importantly, the digital transformation of business will intensify, becoming a prerequisite for development," sums up the expert.