Europe’s balancing act: businesses are shifting toward hybrid storage

As organisations grapple with rising cloud costs, many are shifting toward a more balanced approach when it comes to storage. Findings from the third annual Wasabi Global Cloud Storage Index show that 44% of organisations in the UK, are pursuing a hybrid approach by deploying a mix of on premises and cloud solutions/services. Conducted by Vanson Bourne, the Wasabi Global Cloud Storage Index surveyed 1,600 C-level leadership and managers involved in their organisation’s cloud storage purchasing process. This year’s data explores themes around cloud storage purchase decisions, budgets and billing, data security challenges, and utilisation of services for use cases like backup and active archiving.

Unpredictable fees push organisations beyond their budgets

Among European respondents, cloud storage fees account for nearly half of all cloud billing expenses (47%), with the cost of actual stored capacity making up the remainder (approx. 53%). In large part due to this unfavourable mix, organisations end up exceeding their cloud budgets – in the UK, 37% have exceeded it slightly and 14% massively over the past year. Germany has indicated the highest level of budget excess at 66%, followed by the Netherlands (64%), France (53%) and the UK (51%). The main reason for budget excess are misalignment and difficulty forecasting planned and actual usage, combined with fees from various data operations like replication and object tagging.

44% of UK respondents stated that their actual data storage usage and growth was higher than forecasted, but in 91% of these cases it’s because of fee-related reasons. For more than half of the European organisations (55%), egress or other data access fees associated with moving their data out of a public cloud environment have delayed IT or business initiatives.

“Organisations are being unfairly penalised for using and moving their data by anti-competitive practices like high egress fees and complex pricing models. This is consequently stifling innovation, as data is the lifeblood for unlocking full growth potential. This also shows in our data with organisations being prompted to rethink their approach, leading many to strike a more balanced mix between cloud and on-premise solutions”, says Kevin Dunn, VP & GM EMEA, Wasabi. “At Wasabi, we believe that the cloud market should enable businesses to access and utilise their data freely, without hidden costs or constraints in data mobility.”

The UK leads regional peers in “cloud-first” approach to IT services adoption

This year, UK organisations are leading the global race for cloud adoption, in equal place with the Netherlands – with 41% of businesses following a “cloud-first” strategy compared to the global average of 29% and European average of 34%. “Cloud-first” is defined as prioritising cloud IT services adoption over any alternative requiring owned or on premises IT infrastructure.

“We believe the higher rates of ‘cloud-first’ organisations across Europe are a positive indication of the regions continued embrace of cloud IT services and cloud storage, and the growing preference among regional organisations to adopt cloud services, despite the complexity of data sovereignty, residency, and locality requirements”, comments Dunn.

When choosing a cloud storage provider, UK respondents’ top consideration is performance and scalability (41%), followed by sustainability (32%) and ease of use (30%). For EMEA respondents across the board, native data protection, security and compliance was also brought up as the second highest priority (34%), preceded by performance and scalability (35%), and followed by sustainability (31%).

Country-specific survey results:

For UK organisations cloud storage remains an integral part of their infrastructure strategy

• 44% of UK respondents are following a “balanced” approach to IT services adoption, which is slightly higher than the EMEA average (40%). Almost the same number of organisations prioritise cloud-first (41%), making the cloud an integral part of most infrastructure strategies. Only 16% of UK organisations take a traditional approach – which is characterised by a majority of IT infrastructure still remaining on premises.

• 1 out of 2 organisations in the UK exceeded their public cloud storage budget. The vast majority of UK respondents (91%) cited at least one fee-related choice as a driver of budget excess.

• In the selection of a cloud storage provider, UK organisations prioritise performance and scalability (41%), sustainability (32%) and ease of use (30%).

German organisations are challenged by egress fees

• Germany is quite conservative when it comes to cloud IT services: While 36% have a mix of deployment models including both on premises and cloud IT services, almost half of respondents in Germany take a “traditional” approach to cloud IT services – meaning the majority of their organisation’s IT infrastructure remains on premises (45%).

• This is in line with the relatively recent adoption rates of cloud storage among respondents from Germany; 76% of whom have only been using cloud storage services for five years or less (2020 to present).

• The relatively recent rate of cloud storage adoption, combined with high rate of “traditional” approach to cloud IT services adoption, may be contributing to inefficiencies among organisations in Germany when it comes to managing cloud storage fees. Germany noted the highest proportional mix of fees (50%) in their billing average compared to all other European country

• When asked about the impact of cloud storage fees, 35% of German respondents ranked egress fees among their top three most impactful.

• These fees seem to have an acute impact on German organisations at the IT/business level, with a staggering 3 out of 4 respondents (76%) indicating egress or other data access fees have hindered their organisation’s IT or business initiatives.

In France data protection, security and compliance take centre stage

• 41% of respondents in France take a ”balanced” approach to cloud IT services adoption, with 37% taking a “cloud-first” approach.

• When it comes to choosing a cloud storage provider, data protection, security and compliance take precedence among organisations in France, with 41% of respondents choosing native data protection, security, and compliance features as a top consideration for vendor selection.

• When asked about the key data security-related benefits realised using public cloud storage, French respondents chose ease of preventing and mitigating unplanned data loss

• When asked about security-related challenges of public cloud storage, French respondents ranked securing data across multiple providers as a key issue – likely due to the complexity of managing multiple providers