THE CLOUD in 2014 Predictions from Greylock Partners and its Portfolio Companies

1.  Cloud and mobile security risks will frustrate CIOs in 2014

Asheem Chandna Partner

As enterprises continue their march towards mobile cloud computing, data security will become a top CIO issue in 2014. Many organizations will attempt to solve these problems with poorly suited tools, such as legacy security appliances with bolt-on cloud and mobile updates. Many of those same organizations will suffer through major penetrations and data breaches as a result. !"Organizations everywhere are migrating their front-ends to mobile (smart phones, tablets, laptops), and their back-ends to cloud infrastructures. As these trends accelerate, organizations will continue to lose control over data. Confidential data, intellectual property, and customer information will all be more exposed to risk. These types of data were previously classified and tracked, but are rapidly becoming unmanageable. IT is losing control. Because of that, data security will be a headline-grabbing topic throughout 2014, but those headlines will be negative more often than not."

2.  IT stops blocking cloud services for no good reason

Rajiv Gupta Founder and CEO

There will be big change in 2014 on how IT copes with cloud risks. The status quo is based on outdated arguments and limited visibility. Today, IT generally blocks what it knows (Facebook, YouTube, ESPN.com). Many of these sites are blocked in order to prioritize productivity (and often to conserve bandwidth). And what IT does not know today generally gets through, which is often risky.""This approach is pointless at best, since it’s so easy to find workarounds, and counterproductive at worst, since IT often blocks services that will boost productivity. According to our 2013 Cloud Adoption & Risk Report, which compiled data from more than 3 million users across more than 100 companies in various industries, IT still blocks what it knows, not necessarily what puts organizations at risk.! "In 2014, IT will get the visibility needed to feel comfortable loosening the reigns, helping employees evaluate and understand the risk of these services, rather than simply blocking them. "

3.  Incumbents go on cloud buying sprees to reclaim lost market share

Frederic Kerrest Co-Founder and COO

Those who doubt that cloud computing is the future are on the lunatic fringe, yet there are plenty of lunatics out there. The cloud continues its march throughout enterprises in nearly every industry -- a reality that incumbents can no longer ignore or deny. Microsoft continues to push Office 365, even if that strategy risks eroding Office revenues, and even long-time cloud skeptic Larry Ellison is on board, with the cloud featured prominently at Oracle OpenWorld 2013."Industry incumbents such as Oracle and SAP will accelerate acquisitions of innovative cloud software companies to buy their way into the future. In 2014, IT decision makers must be more vigilant than ever about choosing vendors that have long-term viability — or risk getting locked into an incumbent’s stack all over again. "

4.  Enterprise cloud apps will become mainstream, sparking the rise of niche apps

Frederic Kerrest Co-Founder and COO

In 2014, expect to see increased cloud adoption in nearly every industry. Combined with the economics of the cloud model that make it cheaper to develop and spread applications on a massive scale, this trend will ultimately result in an exponential increase in the number of enterprise cloud applications and services. "!What’s more, 2014 will be the year that niche, industry-specific cloud applications and services will take off. These applications simply weren’t economical in the past, but 2013 proved that’s no longer true. Veeva Systems experienced one of the most successful IPOs of 2013, with a reported $4.4 billion valuation. 2014 will be the year that successful (and profitable) niche cloud companies become the norm. "

5.  IaaS and PaaS are the final two nails in the coffin of the traditional firewall

Amr Awadallah CTO

The traditional firewall isn’t dead, and probably won’t be for a while, but it’s on life support. In 2014, IT will more actively phase out legacy perimeter security tools. Two new cloud technologies, IaaS and PaaS, will be the final nails in the traditional firewall’s coffin. ""IaaS and PaaS are both mainly being used by small startups, while large enterprises have only tested them for new projects and front-end applications without a significant data footprint. In 2014 we will see the beginning of heavy backend data systems/applications moving into the cloud. This will be a significant shift, showing that enterprises are now comfortable enough to have their core (their blood) move outside the walls of their corporation. Not all industries will do that, e.g. finance and health will probably not make the switch in 2014, but other industries will in 2014, such as retail, telecommunications, CPG, and automotive. ""However, as companies make this shift, they will need to rethink their security in order to protect data rather than borders. !

6.  Revenge of the CIO - CIO’s will transition from CI-No’s to tech enablers

Rajiv Gupta Founder and CEO

As IT departments become more strategic, the CIO’s role will change drastically too. CIOs are tired of being “CI-No’s.” It’s not a fun job. Fortunately, they no longer have to fill that role. As IT pros evolve into internal tech consultants who identify, evaluate, and oversee technologies (and not necessarily the ones who have to develop, deliver, or operate these technologies), CIOs will be tasked with figuring out how new technologies deliver competitive advantages.""CIOs will look at cloud, mobile, social media, and whatever other new technology comes along to discern how these cloud services will benefit the business, operationally and strategically. This means the background of CIOs will change as well. Organizations will value pure IT backgrounds less and less, instead prioritizing business and operational experience. "

6.  CIOs who aren’t comfortable with cloud, mobile, and social will be on the hot seat

Rajiv Gupta Founder and CEO

By the end of 2014, CIOs who don’t understand the strategic importance of social, mobile, analytics and cloud will be considered old school and less relevant to the organization. CIOs who “just say no” and fail to adapt will face criticism from everyone from board members who can’t live without access to corporate data on their personal tablets to developers who demand access to services like AWS.!"Moreover, in 2014 CMOs will continue to infringe on areas of responsibility that used to belong solely to the CIO. Those CIOs who continue to block cloud services that deliver business value will place their organizations at a competitive disadvantage, and once the rest of the C-suite wakes up to that fact, it will be the CMO, not the CIO, driving the future of technology within those slow-to-adapt organizations. "

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