1. Copyright 2009 IDC. Reproduction is forbidden unless authorized. All rights reserved. Cloud Computing 2010 An IDC Update Frank Gens, Senior Vice President & Chief Analyst Robert Mahowald, Research Director, SaaS & Cloud Services Richard L. Villars, Vice President, Storage Systems & Executive Strategies David Bradshaw, Research Manager, Applications and Solutions, EMEA Chris Morris, Research Director, Services Research, Asia/Pacific IDC Executive Telebriefing 29 September 2009

2. © 2009 IDC 2 Agenda Cloud Services Global Overview - new CIS Cloud Services Definition & Landscape - updated Cloud User Survey - new findings Worldwide IT Cloud Services Forecast - updated Q&A

3. © 2009 IDC 3 Description: Cloud Services: Global Overview is IDC’s unique program that gives the "rolled-up" view of the entire opportunity for IT Cloud Service provision. This program will provide the complete Cloud services opportunity segmentation by 3 regions and by technology segment (7-10 Black Book segment level). For further drill down please see specific market programs. It will provide survey data on:  How quickly Cloud Services will be adopted and by which customer segments  How Cloud will impact vendor business models and service offerings  Will examine the customer benefits and challenges surrounding Cloud Services Coverage:  An IT Cloud Services Forecast, consisting of 7-10 Black Book-level categories (Servers, Storage, Apps, etc), with a 3-region split (EMEA, Americas, Asia Pacific), and an enterprise size split (large, medium, small)  IDC’s Cloud definition and taxonomy  Cloud user survey findings and spending intentions  Vendor Cloud strategy briefs driven by events, announcements  Industry structure/model scenarios, predictions - focused on mega-shifts IDC sees in industry structure, strategies and other topics Lead Analysts: Frank Gens, Robert Mahowald, Rick Villars Regional Associates: Chris Morris (AP), Satoshi Matsumoto (Japan), Vladimir Kroa (CEE), David Bradshaw & Chris Ingle (W. Europe), Lidice Fernandez (Latin America) Cloud Services Global Overview New

4. © 2009 IDC 4 Cloud Services Definition - updated Consumer and Business products, services and solutions delivered and consumed in real-time over the Internet Cloud Services “casual description”  Shared, standard service – built for a market (public), not a single customer  Solution-packaged – a “turnkey” offering, integrates required resources  Self-service – admin, provisioning; may require some “on-boarding” support  Elastic scaling – dynamic and fine-grained  Use-based pricing – supported by service metering  Accessible via the Internet/IP – ubiquitous (authorized) network access  Standard UI technologies – browsers, RIA clients and underlying technologies  Published service interface/API – e.g., web services APIs Key Attributes

5. © 2009 IDC 5 Cloud Services Definition - updated Consumer and Business products, services and solutions delivered and consumed in real-time over the Internet Cloud Services Public - open to a largely unrestricted universe of potential users; designed for a market, not a single enterprise Private - designed for, and access restricted to, a single enterprise (or extended enterprise); an internal shared resource, not a commercial offering; IT Org is the “vendor” of the shared/std service to its users Deployment Models [Note: large gray zones between these two broad categories]  Shared, standard service – built for a market (public), not a single customer  Solution-packaged – a “turnkey” offering, integrates required resources  Self-service – admin, provisioning; may require some “on-boarding” support  Elastic scaling – dynamic and fine-grained  Use-based pricing – supported by service metering  Accessible via the Internet/IP – ubiquitous (authorized) network access  Standard UI technologies – browsers, RIA clients and underlying technologies  Published service interface/API – e.g., web services APIs Key Attributes

6. © 2009 IDC 6 IT Cloud Services Taxonomy Cloud Applications (Apps-as-a-service) Cloud (Application) Platforms (Platform-as-a-Service) Cloud Infrastructure (Infrastructure-as-a-Service) App Deploy IT Cloud Services App Dev/Test

7. © 2009 IDC 7 All Types of IT Software & Hardware Are or Will Be Offered as Cloud Services… Application Development Software Application Server Middleware Data Access, Analysis, and Delivery Information & Data Management Integration & Process Automation Middleware Other Application Dev and Deployment Quality & Life-Cycle Tools Enterprise Portals Servers Storage Networks Clients System and Network Management Software Security Software Storage Software System Software Collaborative Applications Content Applications Enterprise Resource Management Applications Supply Chain Management Applications Operations and Manufacturing Applications Engineering Applications Customer Relationship Management Applications Cloud Applications (Apps-as-a-service) Cloud (Application) Platforms (Platform-as-a-Service) Cloud Infrastructure (Infrastructure-as-a-Service) App Deploy IT Cloud Services App Dev/Test App Dev & Deployment Systems Infrastructure Software Systems Storage (Software-as-a-Service) Applications Corresponding Primary Market IDC IT Product Taxonomy …many IT and Network Services will also be transformed and extended to support the cloud service delivery model…

8. © 2009 IDC 8 Cloud Services Beyond the IT Industry Cloud Applications (Apps-as-a-service) Cloud (Application) Platforms Cloud Infrastructure (Infrastructure-as-a-Service) App Dev/Test App Deploy The IT Industry’s Cloud Services Cloud Business (Process-as-a-service) Every Other Industries’ Cloud Services

9. © 2009 IDC 9 IT’s Cloud Opportunities Landscape Provide IT Products/Services to enable (public & private) Cloud SPs “arms dealer” Provide Services around IT Cloud Services Provide IT as Cloud Services Servers Storage Network Equipment IT/Network Management Software Network Services App Development/ Deployment Software IT Services – Consulting, Integration, etc. IT & Network Svcs Telcos Pureplay Cloud HW & SW Vendors

10. © 2009 IDC 10 Cloud User Surveys - Benefits Q: Rate the benefits commonly ascribed to the 'cloud'/on-demand model Source: IDC Enterprise Panel, 3Q09, n = 263, September 2009 (Scale: 1 = Not at all important 5 = Very Important) 54.0% 63.9% 64.6% 67.0% 68.5% 75.3% 77.7% 77.9% 0%10%20%30%40%50%60%70%80%90% Seems like the way of the future Sharing systems with partners simpler Always offers latest functionality Requires less in-house IT staff, costs Encourages standard systems Monthly payments Easy/fast to deploy to end-users Pay only for what you use

11. © 2009 IDC 11 Cloud User Surveys - Challenges Q: Rate the challenges/issues of the 'cloud'/on-demand model Source: IDC Enterprise Panel, 3Q09, n = 263, September 2009 (Scale: 1 = Not at all concerned 5 = Very concerned) 76.0% 76.8% 79.8% 80.2% 81.0% 82.9% 83.3% 87.5% 0%10%20%30%40%50%60%70%80%90% Not enough ability to customize Hard to integrate with in-house IT Bringing back in-house may be difficult Lack of interoperability standards On-demand paym’t model may cost more Performance Availability Security

12. © 2009 IDC 12 Cloud User Surveys – Adoption Areas (Scale: 1 = Very Unlikely 5 = Very Likely) Q: Rate your likelihood to pursue the cloud model for the following Source: IDC Enterprise Panel, 3Q09, n = 263, September 2009 48.6% 49.1% 49.8% 50.6% 51.3% 52.9% 54.8% 55.1% 55.6% 59.4% 66.9% 67.3% 0%10%20%30%40%50%60%70%80% IT/Information Security Application dev/test/deploy platform Business Intelligence/Analytics Server capacity on demand IT Management software Storage capacity on demand Data/Content Distribution services Personal productivity apps Business apps (CRM, HR, ERP) Data Back-up or Archive services Web applications/Web serving Collaboration applications

13. © 2009 IDC 13 Cloud User Surveys – Vendor Requirements (Scale: 1 = Not at all important 5 = Very Important) Q: How important is it that cloud service providers … Source: IDC Enterprise Panel, 3Q09, n = 263, September 2009 72.9% 78.3% 79.2% 81.0% 82.1% 84.5% 86.0% 87.8% 88.6% 91.6% 0%10%20%30%40%50%60%70%80%90%100% Have local presence, can come to my offices Are a technology and business model innovator Offer both on-premise and public cloud services Support many of my IT needs Allow managing on-premise & cloud together Understand my business and industry Provide a complete solution Option to move 'cloud' offerings back on premise Offer Service Level Agreements (SLAs) Offer competitive pricing

14. © 2009 IDC 14 IT Cloud Services Forecast Update (preliminary) Applications 49% App Dev/Deploy 10% Storage 9% Servers 12% Infra- structure Software 20% Applications 38% App Dev/Deploy 13% Storage 14% Servers 15% Infra- structure Software 20% Worldwide IT Cloud Services Revenue* by Product/Service Type * Includes revenue from delivery of Applications, Application Development & Deployment Software, Systems Infrastructure Software, Server capacity and Disk Storage capacity via the Cloud Services model; AD&D excludes online B2B messaging providers/exchanges 2009 $17.4 billion 2013 $44.2 billion Source: IDC, September 2009

15. © 2009 IDC 15 Cloud Services as a % of IT Worldwide IT Spending by Consumption Model IT Cloud Services On-Premise IT 5%10% CAGR 26% 4% 44 17 0 100 200 300 400 500 600 20092013 Worldwide IT Spending ($ billion) 359 416 Source: IDC, September 2009

16. © 2009 IDC 16 Cloud Services Growth Impact 460.4 433.1 430 435 440 445 450 455 460 465 470 475 480 485 20122013 Worldwide IT Spending ($ billion) Net new IT growth = $27.3 billion IT Cloud IT Cloud Services growth Traditional IT product growth 27% 73% Source: IDC, September 2009 Sources of Incremental IT Spending Growth in 2013 Cloud vs. Traditional Products

17. © 2009 IDC 17 Cloud’s Position in Asia/Pacific Familiarity is high But opinion is low! Source: IDC Asia/Pacific End-user Cloud Computing Survey, 2009, n=667

18. © 2009 IDC 18 Cloud’s Position in Europe Survey: % of respondents in country/region using 7 or more IT cloud services* Source: IDC European Enterprise Services Survey 2009, n = 533 * Survey list of cloud services included: email/calendar, financials, app dev, collaboration, CRM, HRM, security, office productivity, storage/backup, app platform 0% 2% 4% 6% 8% 10% 12% 14% UKNordicsGermanySpainFranceBeneluxItaly

19. © 2009 IDC 19 Upcoming IDC Cloud Research Plans Cloud Landscape Cloud Services: Global Overview - NEW Asia/Pacific Cloud Services and Technologies - NEW Central and Eastern European Cloud, Hosting and Outsourcing Services United States SaaS and Cloud Services Spending by Vertical 2009 (special report) - NEW Cloud Software/Apps SaaS and Cloud Services European SaaS and Cloud Services Le Marché du Software as a Service (report - France) Japan SaaS and Cloud Services Business Analytics Solutions European Business Analytics Markets & Strategies Software Pricing & Licensing Cloud (application) Platform Application Development & Deployment and Cloud Services Application Life-Cycle Management

20. © 2009 IDC 20 Upcoming IDC Cloud Research Plans Cloud Infrastructure Enterprise System Management Security Services Security Products Storage Solutions: Storage and the Cloud (report series) - NEW Servers in the Cloud (special report) - NEW Services around Cloud Services SOA and Cloud Services: The Professional Services Opportunity WW Consulting & System Integration Services IT Education & Certification ICT Offerings for Cloud SPs Datacenter Networks NGN Operations Storage Solutions: Storage and the Cloud - NEW Servers in the Cloud (special report) - NEW

21. © 2009 IDC 21 Essential Guidance Economic benefits of cloud have risen as adoption drivers, tying last year’s leading driver: speed of deployment Top concerns remain: security, availability, and performance Cloud adoption momentum is strong around collaboration, “cloudifying” Web commerce, and data backup/archive  Core business apps, IT infrastructure services, analytics, and app dev/test/deploy are next in line Top vendor requirements are: pricing; SLAs; dynamism across public cloud, private cloud, and traditional environments; and understanding customers’ business/industry The recession knocked down cloud adoption forecasts, but less than traditional IT – cloud’s growth advantage widened in 2009

22. © 2009 IDC 22 Questions? Contact us at: gcoimbra@idc.com