FSI Slowly Warming Up to Hybrid Cloud

When it comes to hybrid cloud adoption, the financial services industry (FSI) is outpacing others.

According to the recent Nutanix Enterprise Cloud Index Report, hybrid cloud deployment reached 21% percent, which is above the global average of 18.5%.

Part of the reason for this drive toward the hybrid cloud is pressure to streamline operations while delivering a personalized experience to customers. FSI companies who are looking to embrace new technologies like blockchain while weathering compliance, data privacy and security pressures are rewiring their internal infrastructure to become more agile. Many are choosing the hybrid cloud, said the report.

However, the report also showed that many are still struggling to modernize their legacy infrastructure and processes. The report revealed financial services run more traditional data centers than other industries, with 46% penetration. They also use private clouds less than any other sector, at 29% penetration compared to the average of 33%.

Like other industries, the financial services sector cites security and compliance as the top factor in deciding where to run its workloads. Nearly all respondents also indicated that performance, management, and TCO are critical factors in the decision.

Ninety-one percent of FSI companies surveyed said that hybrid cloud was the ideal IT model. The recognized need for digital transformation likely drives this belief in the hybrid cloud and the fact that the sector saw higher than average industry adoption of hybrid cloud, the report noted.  

Conversely, the data shows a lower adoption of private clouds (21%) than the global average across industries. The report noted that the disparity might be explained by the fact that portions of the financial services space have been change-averse and also an indication of the overall complexity of modernizing existing legacy infrastructures.

Other key findings of the report include:

  • Both financial companies and other industries chose application mobility between clouds second most often as the number one perk to the hybrid cloud. Sixty-three percent of financial industry respondents said they considered inter-cloud application mobility “essential.” 
  • Need to gain control over their IT spend is another motivator for FSI companies deploying hybrid clouds. 
  • Hybrid cloud skills are scarce in today’s IT organizations and rank only second to artificial intelligence and machine learning (AI/ML) skills. It can be a constraint for FSI companies.