Flexera™

2021

STATE OF THE
CLOUD REPORTCOVID-19 accelerates cloud
plans and spend as moreorganizations adopt
multi-cloud strategies

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© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

2

Contents
Executive summary .......................................................................................................... 9
The highlights ................................................................................................................. 10
Methodology .................................................................................................................. 12
Respondent demographics ............................................................................................. 12Enterprises embrace multi-cloud .................................................................................... 16
Enterprises combine multiple public and private clouds ................................................... 17
Applications often are siloed on different clouds ................................................................ 18
Almost all organizations are using at least one cloud ........................................................ 20
Organizations use multiple clouds ....................................................................................... 21
Public cloud adoption continues to accelerate ................................................................. 22
36 percent of enterprises spend more than $1 million monthly ......................................... 23
SMB spend is less than enterprise spend ............................................................................. 24
Half of workloads and data are in a public cloud ................................................................ 25
Nearly half of enterprise workloads and data are in a public cloud ................................... 26
Nearly two-thirds of SMB workloads will be in cloud .......................................................... 26
Most believe COVID-19 will increase their cloud usage ....................................................... 27
Organizations are open to moving sensitive data to the cloud .......................................... 28
Dependency mapping is top cloud migration challenge .................................................... 29
Migration challenges are greater for enterprises ................................................................. 30© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

Understanding cloud initiatives and metrics ................................................................... 31
Optimizing spend is top cloud initiative for the fifth year running ..................................... 31
Organizations measure cloud progress by savings, agility and value ................................ 33
Organizations are taking a centralized approach to cloud ................................................ 34
Enterprises lean heavily on central teams ........................................................................... 35
Enterprise central teams optimize cloud costs and govern use ......................................... 36
SAM and vendor management can lend expertise .............................................................. 37
MSPs help with cloud work .................................................................................................. 38
Top challenges are security, spend, governance and expertise ........................................ 39
Enterprises and SMBs diverged in their ranking of the top challenges .............................. 39
Enterprise challenges decline, except for security .............................................................. 40
Cost, governance and security remain challenges .............................................................. 41
Managing software costs is challenging in the cloud .......................................................... 43
Organizations struggle to handle growing cloud spend .................................................... 44
Organizations waste significant cloud spend ...................................................................... 45
Cloud provider discounts offer savings opportunities ........................................................ 46
Organizations use automation to optimize costs ................................................................ 47
Containers are now mainstream ..................................................................................... 48
Lack of expertise is the top challenge for container use ..................................................... 50
Adoption of cloud configuration tools is shifting .............................................................. 51© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

Public cloud adoption is evolving .................................................................................... 53
Major public cloud provider use shifting among enterprises ............................................. 54
Choice of public cloud provider changing for SMBs ............................................................ 56
Maturity affects public cloud provider choice ..................................................................... 58
Enterprises are growing their public cloud footprint .......................................................... 59
Use of public cloud PaaS services is increasing ................................................................ 61
Most heavily used PaaS services have shifted ..................................................................... 61
Enterprises use more PaaS services ..................................................................................... 62
PaaS services use increases with maturity .......................................................................... 63
Private cloud plays important role .................................................................................. 64
SMBs use private clouds less than enterprises .................................................................... 65
Summary ........................................................................................................................ 67
Europe spotlight: introduction ........................................................................................ 68
Europe spotlight: highlights ............................................................................................ 68
European respondent demographics .............................................................................. 69
European cloud usage accelerates faster due to COVID-19 ............................................... 73
Seven in ten European respondents have cloud teams or centers of excellence ................ 74
Assessing technical feasibility is top cloud migration challenge ........................................ 75
Managing software costs is challenging in the cloud .......................................................... 76
Migrating to cloud is top initiative ................................................................................... 77
Enterprises embrace multi-cloud .................................................................................... 78
About Flexera .................................................................................................................. 79© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

Table of Figures
Figure 1. Respondents by organization size .......... 12

Figure 2. Respondents by industry ......................... 13
Figure 3. Respondents by geography ..................... 14
Figure 4. Respondents by level and by role ........... 15
Figure 5. Cloud maturity levels
for all organizations ................................................. 15
Figure 6. Enterprises have a multi-cloudstrategy .................................................................... 16
Figure 7. Enterprise hybrid cloud strategies .......... 17
Figure 8. Use of multi-cloud architectures by
all organizations ...................................................... 18
Figure 9. Use of multi-cloud management tools
for all organizations ................................................. 19
Figure 10. Breakdown of cloud types used
for all organizations ................................................. 20
Figure 11. Average number of public andprivate clouds used for all organizations ................ 21
Figure 12. Public cloud spend
for all organizations ................................................. 22
Figure 13. Annual public cloud spend
for enterprises ......................................................... 23
Figure 14. Comparison of enterprise and
SMB cloud spend ..................................................... 24
Figure 15. Workloads and data in a public cloud
for all organizations ................................................. 25© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

Figure 16. Enterprise workloads anddata in a public cloud .............................................. 26
Figure 17. SMB workloads anddata in a public cloud .............................................. 26
Figure 18. COVID-19 impact on planned
cloud usage for all organizations ............................ 27
Figure 19. Type of data that will move to public
clouds for all organizations ..................................... 28
Figure 20. Cloud migration challenges
for all organizations ................................................. 29
Figure 21. Comparison of cloud challenges
for enterprises and SMBs ........................................ 30
Figure 22. Ranking of 2021 cloud initiatives
for all organizations ................................................. 31
Figure 23. Top cloud initiatives by cloudmaturity for all organizations .................................. 32
Figure 24. Top metrics for assessing progressagainst cloud goals for all organizations ................ 33
Figure 25. Adoption of central cloud team/CoE
for all organizations ................................................. 34
Figure 26. Central cloud team/CoE byorganization size ...................................................... 35
Figure 27. Central IT responsibilities
in enterprises ........................................................... 36
Figure 28. Cloud cost management responsibilities
by IT team for all organizations ............................... 37

Figure 29. Leveraging MSPs to manage public
cloud resources for all organizations ...................... 38
Figure 30. MSP usage by enterprises
versus SMBs ............................................................. 38
Figure 31. Top cloud challenges
for all organizations ................................................. 39
Figure 32. Comparison of top challenges
for enterprises versus SMBs .................................... 39
Figure 33. YoY comparison of top cloudchallenges for enterprises ....................................... 40

Figure 42. Enterprise use of container tools .......... 49
Figure 43. SMB use of container tools .................... 49
Figure 44. Top container-related challenges forall organizations ...................................................... 50
Figure 45. Current and planned configuration
tools for all organizations ........................................ 51
Figure 46. Enterprise container tool usage ............ 52
Figure 47. SMB container tool usage ...................... 52

Figure 34. Cloud maturity doesn’t lessen theseverity of every challenge for all organizations .... 41

Figure 48. Public cloud provider adoption rates
for current use/experimenting/planned for allorganizations ........................................................... 53

Figure 35. The ranking of cloud challenges bymaturity level for all organizations ......................... 42

Figure 49. YoY public cloud provider adoption
rates for all organizations ........................................ 54

Figure 36. Top software challenges
for all organizations ................................................. 43

Figure 50. Enterprise public cloud adoption
rates for current use/experimenting/planned ....... 54

Figure 37. Overspending on public cloud
for all organizations ................................................. 44

Figure 51. YoY enterprise adoption rates ............... 55

Figure 38. Respondent self-estimates of wasted
cloud spend for all organizations ........................... 45
Figure 39. Discount types organizations
are leveraging .......................................................... 46
Figure 40. Types of policies to optimize
cloud costs ............................................................... 47
Figure 41. Current and planned container use
for all organizations ................................................. 48© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

Figure 52. SMB public cloud adoption rates for
current use/experimenting/planned ...................... 56
Figure 53. YoY SMB adoption rates ......................... 57
Figure 54. Public cloud provider adoption basedon cloud maturity level for all organizations ......... 58
Figure 55. Enterprise spend for top threecloud providers ........................................................ 59
Figure 56. Number of VMs enterprises use by
cloud provider ......................................................... 60

Figure 57. Public cloud services organizations
are using, experimenting with or plan to use ......... 61

Figure 66. European respondents by level andby role ...................................................................... 71

Figure 58. Public cloud services enterprises
are using or plan to use ........................................... 62

Figure 67. European respondents by cloudmaturity level ........................................................... 72

Figure 59. Services used based on cloudmaturity for all organizations .................................. 63

Figure 68. European respondents compared toAmericas respondents by maturity level ................ 72

Figure 60. Private cloud technologies
organizations are using, experimenting
with or plan to use ................................................... 64

Figure 69. Accelerating cloud plans in Europe
due to COVID-19 ....................................................... 73

Figure 61. Private cloud providers enterprises
are currently using, experimenting with orplanning to use ........................................................ 65
Figure 62. Private cloud providers SMBs are
currently using, experimenting with or planning
to use ........................................................................ 66

Figure 70. Adoption of central cloud team/CoE
for European organizations ..................................... 74
Figure 71. Cloud migration challenges
for European organizations ..................................... 75
Figure 72. Top software challenges
for European organizations ..................................... 76

Figure 63. European respondents byorganization size ...................................................... 69

Figure 73. Cloud initiatives
for European organizations ..................................... 77

Figure 64. European respondents by industry ...... 70

Figure 74. European enterprises with amulti-cloud strategy ................................................ 78

Figure 65. European respondents by region .......... 71© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

FLEXERA™ 2021 STATE OF THE CLOUD REPORT
Cloud spend is rising as organizations adopt multi-cloudstrategies and put more workloads and data in the cloud
Executive summary
Cloud adoption was expanding rapidly even before COVID-19. After the pandemic
took hold, cloud plans and adoption increased even faster. Cloud trends
can guide an organization’s digital business decision processes, vendor andtechnology selection, and investment strategies. This tenth annual Flexera 2021
State of the Cloud Report (previously known as the RightScale State of the Cloud
Report) delves into the details of what respondents had to say to reveal what’s
happening with all things cloud—from spend allocation to cost management tostrategies. Leveraging this data can help IT professionals plan the next steps oftheir cloud journey.
The report explores the thinking of 750 global cloud decision-makers and users
about the public, private and multi-cloud market. It shares their current andfuture cloud strategies, often showing year-over-year (YoY) changes to help
identify trends. And it offers perspective on how some trends have changed
over the years. The survey was conducted in October and November of 2020.

Terminology used throughout the report:
Enterprises are public- or private-sector organizations with 1,000 or more employees
SMBs are small-to-midsized businesses with fewer than 1,000 employees
Organizations refers to the combination of enterprises and SMBs participating in the survey© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

9The highlights
The Flexera 2021 State of the Cloud Report survey captured insights into how organizations are progressing intheir journey to cloud. This information includes their mix of public and private clouds, the volume of workloads
and data in the cloud, top challenges and initiatives, cost management concerns, and the cloud providers,technologies and tools they’re using. The following are some of the responses we found the most interesting:Enterprises embrace multi-cloud

Understanding cloud initiatives and metrics• 92 percent of enterprises have a multi-cloudstrategy; 80 percent have a hybrid cloud strategy• 61 percent of organizations plan to optimize
cloud costs in 2021, making it the top
initiative for the fifth year in a row• 49 percent silo workloads by cloud, with
45 percent integrating data between clouds• Only 42 percent of all participating organizations
use multi-cloud management tools• Respondents use an average of
2.6 public and 2.7 private clouds
Public cloud adoption continues to accelerate• 36 percent of enterprises spend more than
$12 million per year on public clouds• 55 percent of enterprise workloads are expected
to be in a public cloud within twelve months• 90 percent of respondents who answered aquestion about COVID-19 expect cloud use
to exceed plans due to the pandemic• 59 percent of organizations plan tofocus on cloud migration• 76 percent of organizations use cost efficiency
and savings to measure cloud progress
Organizations are taking a centralized
approach to cloud• 77 percent of enterprises have a central cloud
team or cloud center of excellence (CoE)• 54 percent of cloud teams are responsible forgoverning infrastructure-as-a-service (IaaS)/
platform-as-a-service (PaaS) usage and costs• 63 percent of enterprises reported
using cloud managed service providers(MSPs) to manage public cloud use• The top challenge in cloud migration isunderstanding application dependencies© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

10Top challenges are security, spend,
governance and expertise• Overall, 81 percent indicate that security is achallenge, followed by 79 percent for managing
cloud spend and 75 percent each for governance,lack of resources/expertise and compliance

Public cloud adoption is evolving• AWS, Azure and Google Cloud remain the top
three public cloud providers• Azure continues to narrow the gap with AWS
for enterprise users• 55 percent overall report that understanding
cost implications of software licenses is a top
cloud challenge

Use of public cloud PaaS services is increasing

Organizations struggle to handle
growing cloud spend• 28 percent of enterprises are experimenting
with machine learning/AI, which is morethan any other PaaS services• Respondents estimate 30 percent
of cloud spend is wasted• Organizations are not taking advantage
of all cloud provider discounting
options, but adoption is growing• Users are leveraging automated policies toshut down workloads after hours (49 percent)and rightsize instances (48 percent)• Data warehouse has the highest adoption,used by 54 percent of organizations

Private cloud adoption plays important role
• VMware vSphere continues to lead in private
cloud (36 percent currently use). Microsoft
Azure Stack usage is at 35 percent; AWS Outpost
and OpenStack each have 28 percent• Private cloud adoption by SMBs is lower overallthan for enterprises

Adoption of cloud configuration tools is shifting• Terraform (36 percent) and Ansible (31 percent) now
show highest adoption of cloud configuration tools• Terraform leads among both enterprises
and smaller organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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Methodology
A total of 750 technical professionals from around the globe and across a broad crosssection of organizations participated in the Flexera 2021 State of the Cloud Report survey.
The participants provided insights into their adoption of cloud infrastructure. The
independent panel is rigorously maintained and comprises vetted respondents withdetailed profiles.
Most respondents are cloud decision-makers and users from organizations ranging from100 employees to more than 10,000 employees. Their answers provide a comprehensive
perspective on the state of the cloud today

Respondent demographics
Organizations of all sizes are using the cloud to help manage IT workloads. However, thissurvey skews toward larger organizations. As Figure 1 shows, 85 percent of participatingorganizations are enterprises that employ at least 1,000 people. The top challenges thatthese larger enterprises face are security, managing cloud spend and governance; SMBs
often struggle with security, managing cloud spend and lack of resources/expertise.
Terminology used throughout the report:• All respondents = 750• Enterprise respondents (at least 1,000 employees) = 637• SMB respondents (less than 1,000 employees) = 113

Figure 1. Respondents by organization size

© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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Businesses in almost all industries leverage cloud computing. As Figure 2 indicates, thereport covers a broad range of industries. The Other category includes those industries
that represent less than three percent of respondents.

Figure 2. Respondents by industry© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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Figure 3 shows the locations of participating organizations around the world:• The Americas include respondents from the United States,
Canada, Mexico and Brazil• Europe includes respondents from a broad set of countries• The Asia-Pacific region comprises respondents from Australia,
India, Japan, Singapore and South Korea• Rest of world includes respondents not included incountries above, including African countries

Figure 3. Respondents by geography© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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Figure 4 indicates the breakdown of respondents by level within the organization and bybusiness role.

Figure 4. Respondents by level and by role

Cloud has now become mainstream. As Figure 5 shows, more than half of respondents use cloudheavily and have reached the advanced cloud maturity level. Twenty-one percent of organizations
are at the intermediate maturity level, and 19 percent are beginners.

Figure 5. Cloud maturity levels for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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Enterprises embrace multi-cloudEnterprises have almost entirely embraced multi-cloud. As Figure 6 indicates, 92 percent ofrespondents reported having a multi-cloud strategy. Eighty-two percent are taking a hybrid
approach, combining the use of both public and private clouds.

Figure 6. Enterprises have a multi-cloud strategy© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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Enterprises combine multiple public and private clouds
This year’s survey delved into the various cloud combinations used by enterprises with a hybrid
strategy, as Figure 7 shows. Of those enterprises, 76 percent said they’re incorporating multiple
public clouds, while 56 percent report using more than one private cloud. The most common
combination is a mix of various public and private clouds, with 43 percent taking this approach.

Figure 7. Enterprise hybrid cloud strategies© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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Applications often are siloed on different clouds
While organizations are using multiple clouds, this doesn’t necessarily mean individual
applications are spanning clouds. As Figure 8 shows, apps siloed on different clouds is the mostcommon multi-cloud implementation, with 49 percent of respondents saying they use it. Data
integration is the most common type of architecture that spans clouds. However, more than
one-third of respondents are using more advanced architectures, such as workload mobility
between clouds and individual apps that span public and private clouds.

Figure 8. Use of multi-cloud architectures by all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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Use of multi-cloud cost management tools grew by nine percent
Multi-cloud architectures are more complex and, therefore, more challenging to manage.
Multi-cloud tooling is essential for managing cloud resources cost-effectively and ensuringstrong governance and security. Forty-two percent of organizations are taking advantage ofmulti-cloud management tools, as Figure 9 indicates. This is a nine percent increase over lastyear’s findings.

Figure 9. Use of multi-cloud management tools for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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Almost all organizations are using at least one cloud
As Figure 10 indicates, 99 percent of respondents are using at least one public or private cloud.
Ninety-seven percent of respondents utilize at least one public cloud, while 80 percent have atleast one private cloud. Seventy-eight percent of respondents are using hybrid cloud.

Figure 10. Breakdown of cloud types used for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

20Organizations use multiple clouds
As Figure 11 shows, organizations currently use an average of 2.6 public and 2.7 private clouds.
They’re also experimenting with an additional 1.1 public clouds and 2.2 private clouds.

Figure 11. Average number of public and private clouds used for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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Public cloud adoption continues to accelerate
The increasing use of public cloud is driving up cloud spend for organizations of all sizes. Public cloud
spend is now a significant line item in IT budgets, especially among larger organizations.
As Figure 12 indicates, 31 percent of respondents (nearly double last year’s 16 percent) reported annual
spend of at least $12 million ($1 million per month) on public cloud, while 76 percent spend $1.2
million or more per year ($100,000 per month).

Figure 12. Public cloud spend for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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36 percent of enterprises spend more than $1 million monthly
As Figure 13 shows, 36 percent of enterprises said their annual spend exceeded $12 million and
83 percent reported that cloud spend exceeds $1.2 million per year. These figures represent anincrease over last year, when 20 percent of enterprises reported an annual spend of more than
$12 million and 74 percent reported yearly spend of more than $1.2 million.

Figure 13. Annual public cloud spend for enterprises© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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SMB spend is less than enterprise spend
SMBs generally have substantially lower cloud bills because they run fewer workloads in thecloud than enterprises. As Figure 14 indicates, 37 percent of SMBs are spending less than
$600,000 annually, compared with only six percent of enterprises. However, 38 percent of
SMBs spend more than $1.2 million—up from 32 percent reported last year.

Figure 14. Comparison of enterprise and SMB cloud spend© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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Half of workloads and data are in a public cloud
Figure 15 shows that respondents are running 50 percent of their workloads in public cloud
and they expect to increase that number to 57 percent in the next 12 months. With respect todata, 46 percent of organizations’ data is in public cloud today and respondents expect to add
another eight percent over the next 12 months.

Figure 15. Workloads and data in a public cloud for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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Nearly half of enterprise workloads and data are in a public cloud
As Figure 16 indicates, enterprises are running 47 percent of workloads and storing 44 percent
of data in a public cloud. Enterprise respondents plan to increase workloads and data in public
cloud over the next 12 months by eight percent and seven percent, respectively.

Figure 16. Enterprise workloads and data in a public cloud

Nearly two-thirds of SMB workloads will be in cloud
SMBs are moving quickly to the public cloud. As Figure 17 indicates, 69 percent of SMB
workloads and 67 percent of data will reside in a public cloud within the next 12 months.

Figure 17. SMB workloads and data in a public cloud© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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Most believe COVID-19 increased their cloud usage
The emergence of COVID-19 prompted Flexera to add a question to the survey in 2020 that gauges
how the pandemic might impact cloud strategy. Cloud plans and adoption have clearly shifted as aresult of the pandemic.
Responses to the present survey indicate how organizations expect COVID-19 to affect their cloud
plans. As Figure 18 indicates, 90 percent said cloud usage is higher than initially planned. Some of
the increase is a result of the extra capacity needed for current cloud-based applications to meetincreased demand as online usage grows. Other organizations may accelerate migration from data
centers to cloud in response to reduced headcount, difficulties in accessing data center facilities
and delays in hardware supply chains.
As the pandemic runs its course, some organizations may also find that public cloud providers offer
a more reliable option for business continuity.

Figure 18. COVID-19 impact on planned cloud usage for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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Organizations are open to moving sensitive data to the cloudIn the past, some organizations hesitated to put certain types of data in public clouds. This
year’s survey found many respondents are reconsidering. As Figure 19 shows, more thanhalf of respondents said they’ll consider moving at least some of their sensitive consumer
data or corporate financial data to the cloud, which reflects increasing confidence in the
security practices of cloud providers.

Figure 19. Type of data that will move to public clouds for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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Dependency mapping is top cloud migration challenge
Mapping all the relationships across apps, hardware and networking devices for each IT-delivered
service is notoriously difficult to do, especially in a rapidly evolving environment. It’s therefore no
surprise that 51 percent of respondents reported understanding app dependencies as the top cloud
migration challenge, as Figure 20 indicates.
Other critical challenges include assessing the technical feasibility (of migrating on-premises apps),
assessing on-prem versus cloud costs and rightsizing/selecting the best instance. Organizations needto address these challenges so they can make informed decisions as to which apps to migrate andoptimize the cost of running on-premises apps that were in the cloud.

Figure 20. Cloud migration challenges for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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Migration challenges are greater for enterprises
While enterprises are improving their understanding of app dependencies (66% cited it as achallenge last year, down to 51% this year in Figure 21), their ability to assess technical feasibility
is still a weak point (48% last year going up to 49% this year), as is the ability to assess on-premises
vs cloud costs (44% last year, 45% this year).
As Figure 21 indicates, both enterprises and SMBs rank understanding app dependencies andassessing technical feasibility as their top challenges. However, these obstacles are tougher forlarger organizations, which have more on-premises applications and more complex environments.
Enterprises also face significantly larger challenges than SMBs in assessing the cost implicationsof cloud migrations.

Figure 21. Comparison of cloud challenges for enterprises and SMBs

© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

30

Understanding cloud initiatives and metrics

Optimizing spend is top cloud initiative for the fifth year running
For the fifth year in a row, optimizing the existing use of cloud (cost savings) is the top initiative forthe year ahead, followed by migrating more workloads to cloud and better financial reporting on
cloud costs. Figure 22 shows the rankings for this year.
Optimizing usage is a cost-control measure. Migrating workloads can save money and drive
agility. As organizations move more workloads to the cloud, they can retire the technical debt
associated with maintaining and operating traditional data centers. Better financial reporting on
cloud costs gives more stakeholders within an organization actionable insight into cloud usage.

Figure 22. Ranking of 2021 cloud initiatives for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

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Figure 23 divides the respondents by cloud maturity: beginner, intermediate and advanced.
Beginners, intermediate and advanced users rank optimizing existing use of cloud as their
top initiative, and each followed with migrating more workloads to cloud. This cost savings
initiative was named by 61 percent of beginner organizations, 71 percent of intermediate-level
organizations and 69 percent of advanced organizations.

Figure 23. Top cloud initiatives by cloud maturity for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

32

Organizations measure cloud progress by savings, agility and value
Figure 24 lists the ranking of metrics that organizations are using to measure cloud progress.
The top three are cost efficiency/savings, delivery speed of product/services and cost avoidance.
To achieve cost benefits, organizations must optimize as they migrate by rightsizing and using
automation to monitor and optimize spend continually.

Figure 24. Top metrics for assessing progress against cloud goals for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

33

Organizations are taking a centralized approach to cloud
As organizations adopt cloud-first strategies, many are creating a central cloud team or a cloudcenter of excellence (CoE) tasked with providing centralized controls, tools and best practices.
The purpose of these teams is to accelerate cloud adoption by centralizing expertise while
reducing costs and risk. As Figure 25 shows, 75 percent of organizations have a central cloud
team or cloud CoE.

Figure 25. Adoption of central cloud team/CoE for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

34

Enterprises lean heavily on central teams
Enterprises have a greater need for centralization than SMBs. Spend, governance andsecurity within larger organizations are much more complex, and teams overseeing thoseareas must coordinate across multiple business units and functional areas. As Figure 26
indicates, 77 percent of enterprises already have a central cloud team or cloud CoE,
compared with 55 percent of SMBs. Only eight percent of enterprises and 23 percent
of SMBs have no plans for a central cloud team.

Figure 26. Central cloud team/CoE by organization size

© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

35

Enterprise central teams optimize cloud costs and govern use
Figure 27 shows the role enterprise central IT teams play in providing guardrails for cloud use.
These cloud teams shoulder most of the responsibility for cloud cost optimization, migration
planning and governance. They also serve in an advisory capacity to help stakeholders makeinformed decisions and ensure the apps selected comply with the enterprise governanceframework and security policies.

Figure 27. Central IT responsibilities in enterprises© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

36

SAM and vendor management can lend expertiseAs Figure 28 indicates, the cloud team and infrastructure and operations team are actively
involved in enterprise cloud cost management. Their top responsibilities include governing
IaaS and PaaS usage and costs, optimizing cloud spend and report/analyze cloud costs.
These are responsibilities that software asset management (SAM) and vendor management
teams have traditionally handled for on-premises software. Consequently, SAM and vendor
management professionals have extensive experience in optimizing license consumption.
This expertise ensures compliance with contract terms, negotiating and managing favorable
contracts, reclaiming unused licenses, optimizing renewals, and automating license
management for on-premises and enterprise SaaS agreements. Organizations could benefit
significantly from increased involvement by these teams in cloud cost management.

Figure 28. Cloud cost management responsibilities by IT team for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

37

MSPs help with cloud work
As Figure 29 shows, 61 percent are outsourcing at least some cloud work, with 29 percent
engaging cloud managed service providers (MSPs) for most of their public cloud use.

Figure 29. Leveraging MSPs to manage public cloud resources for all organizations

Figure 30 indicates that enterprises are more likely to use MSPs than are SMBs.

Figure 30. MSP usage by enterprises versus SMBs

© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

38Top challenges are security, spend, governance and expertise
The top cloud challenges in 2021 are all quite close in how often respondents cite them. As Figure 31 shows,the top five are security, managing cloud spend, governance, lack of resources/expertise and compliance.

Figure 31. Top cloud challenges for all organizations

Enterprises and SMBs diverged in their ranking of the top challenges
Figure 32 indicates enterprises followed the overall trend with security and managing cloud spend at
the top. But SMBs ranked lack of resources/expertise as their third challenge, followed by governance.

Figure 32. Comparison of top challenges for enterprises versus SMBs
© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

39

Enterprise challenges decline, except for security
Enterprises are gaining experience with cloud, which has led to slight decreases in perceived
cloud challenges. However, due to the growing number of workloads in the cloud and thedevelopment of hybrid and multi-cloud strategies, enterprises still face severe challenges
around security, managing cloud spend and governance. Figure 33 shows the top enterprisecloud challenges for 2021 compared with 2020.

Figure 33. YoY comparison of top cloud challenges for enterprises© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

40

Cost, governance and security remain challenges
Some types of challenges, such as managing multi-cloud environments, become moremanageable as the organization matures and gains experience. But others remain
significant, even in organizations at the advanced cloud maturity level. As Figure 34
indicate, these include security, managing cloud spend, governance and compliance.
One possible reason for this phenomenon is that the factors driving these challenges
present moving targets. Hackers continue to increase their sophistication, necessitating
constant attention to cloud security. Also, new legislation and regulations continue toemerge, particularly in industries such as financial services and healthcare, as legislators
attempt to catch up with technology.

Figure 34. Cloud maturity doesn’t lessen the severity of every challenge for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

41

As Figure 35 indicates, governance is the top challenge for beginners but diminishes forintermediate and advanced cloud users. The top challenge for intermediate users is lackof resources/expertise. For advanced users, managing cloud spend and security are the top
challenges.

Figure 35. The ranking of cloud challenges by maturity level for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

42

Managing software costs is challenging in the cloud
As Figure 36 shows, the top software-related challenge in the cloud is understanding cost
implications of software licenses, followed by challenges related to license compliance.
As stated earlier, software asset management and vendor management teams haveconsiderable expertise in these areas. Organizations would be well advised to leverage
their skills to address software challenges in the cloud.

Figure 36. Top software challenges for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

43Organizations struggle to handle growing cloud spend
Organizations are continuing to rapidly increase their cloud spend. In so doing, they struggle toaccurately forecast their fast-growing cloud costs. As Figure 37 indicates, respondents reported
their public cloud spend was over budget by an average of 24 percent. Moreover, respondents
expect their cloud spend to further increase by 39 percent in the next twelve months. This trendmeans it’s more critical than ever to get a handle on forecasting and cost optimization.

Figure 37. Overspending on public cloud for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

44

Organizations waste significant cloud spend
Wasted cloud spend is a major issue and becomes more critical as cloud costs continue
to rise. As Figure 38 shows, respondents self-estimate that their organizations waste
30 percent of cloud spend. However, spend is likely less efficient as many organizations
tend to underestimate the amount of waste. In working with customers to identify waste,
Flexera has found that, on average, actual waste is 35 percent or even higher.

Figure 38. Respondent self-estimates of wasted cloud spend for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

45

Cloud provider discounts offer savings opportunities
Cloud provider pricing structures are complex and tricky to decipher. However, taking a close
look at provider discounts could uncover opportunities to reduce costs. Figure 39 indicates thatorganizations aren’t taking advantage of all the available discounts. Just over half (52 percent) of
AWS users leverage reserved instances and only 46 percent of Azure users do so. But organizations
seem to be moving quickly to adopt the AWS Savings Plan (44 percent in 2021 vs 30 percent in2020), a new offering in 2020 that simplifies discounting.

Figure 39. Discount types organizations are leveraging© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

46

Organizations use automation to optimize costs
Figure 40 indicates that policies are being leveraged by organizations to optimize costs.
Automated cloud cost optimization policies can save time while ensuring that organizations
monitor their environments consistently to eliminate waste.

Figure 40. Types of policies to optimize cloud costs© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

47

Containers are now mainstream
The use of Docker and Kubernetes continues to be considerable. As Figure 41 indicates,
53 percent of organizations use Docker and 21 percent plan to use it. Forty-eight percent
use Kubernetes, a container orchestration tool that leverages Docker, and another25 percent plan to use it.
Many organizations are also choosing container-as-a-service offerings from public cloudproviders. The AWS container service (ECS/EKS) experienced substantial adoption, with
51 percent using it and another 23 percent planning to use it. Azure Container Service
adoption reached 43 percent, and Google Kubernetes Engine (GKE) reached 31 percent.

Figure 41. Current and planned container use for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

48

As Figure 42 and Figure 43 illustrate, Docker is used about the same between enterprises(54 percent) and SMBs (48 percent). AWS ECS/EKS is now the most popular container toolby SMBs (52 percent) and the second most popular with enterprises (51 percent). Enterprises
use Kubernetes more frequently (50 percent) than SMBs (37 percent). (Note: Respondents
could select all container tools that apply to them; there is obvious overlap between someof the answers.)

Figure 42. Enterprise use of container tools

Figure 43. SMB use of container tools© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

49

Lack of expertise is the top challenge for container use
Organizations face challenges using containers. As Figure 46 indicates, the top container
challenges are the lack of internal resources with expertise, ensuring security and migrating
traditional applications to containers. These resource challenges can be attributed to therelatively recent adoption of container technology. Migrating traditional applications tocontainers is problematic because containers are optimized for microservices, while
traditional apps aren’t.

Figure 44. Top container-related challenges for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

50Adoption of cloud configuration tools is shifting
Cloud use often goes hand in hand with adopting DevOps processes. Organizations will
frequently choose to implement configuration management tools that allow them tostandardize and automate deployment and configuration of servers and applications.
As Figure 45 shows, Terraform, used by 36 percent of respondents, leads among all
configuration tools. Ansible is close behind with 31 percent. Chef and Puppet are in a
virtual tie at 29 percent and 27 percent, respectively. (Note: Many organizations use morethan one tool, so the individual percentages add up to more than 100 percent.)

Figure 45. Current and planned configuration tools for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

51

Figure 46 shows the configuration tools used by enterprises, and Figure 47 indicates the tools
used by SMBs. Overall, the use of configuration tools is higher among enterprises. Terraform
leads for enterprises, with Ansible second at 33 percent and Chef third at 32 percent.

Figure 46. Enterprise container tool usage

Figure 47. SMB container tool usage© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

52

Public cloud adoption is evolving
The survey delved into the private and public clouds that organizations are using. For eachpublic cloud provider, respondents specified whether they’re running applications in thatcloud, experimenting with it, planning to use it or had no plans to use it. Most respondents areusing more than one cloud, so individual percentages sometimes total more than 100 percent.
It’s important to note that adoption—meaning an organization is using a cloud provider—is only one factor influencing revenue growth for the provider. The survey also explores
other factors, including the number of VMs running and PaaS cloud services used. This year
respondents were also asked about their level of cloud spend per cloud provider.
In 2021, as in previous years, AWS, Microsoft Azure and Google Cloud are the top three public
cloud providers. Figure 48 shows how the major providers stack up for adoption across all
respondents in 2020. Figure 49 compares the rankings for 2020 and 2021.

Figure 48. Public cloud provider adoption rates for current use/experimenting/planned
for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

53

Figure 49. YoY public cloud provider adoption rates for all organizations

Major public cloud provider use shifting among enterprises
Among enterprises, Azure is tied with AWS for breadth of adoption, as Figure 50 indicates.
Google Cloud, Oracle and VMware Cloud on AWS round out the top five. Among the top three,
Google (49 percent running workloads) exhibited the most growth over 2020. The highest
percentages for experimentation are with VMware Cloud on AWS and Oracle, which could drive
more adoption in future years.

Figure 50. Enterprise public cloud adoption rates for current use/experimenting/planned© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

54

Figure 51 shows that AWS and Azure adoption rates rose somewhat among enterprises over theprevious year. Azure is now at 96 percent of AWS adoption among enterprises. Google adoption
rates rose by 44 percent.

Figure 51. YoY enterprise adoption rates© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

55

Choice of public cloud provider changing for SMBs
Among SMBs, AWS continues to show a clear lead. As Figure 52 indicates, vendors thathave traditionally appealed to enterprises (VMware, IBM and Oracle) have 10 percent or lesspenetration in this market in terms of planning to use. Alibaba Cloud is used widely in China,
but much less so globally. Thirty-six percent of SMBs are experimenting with Azure and19 percent are trying Google.

Figure 52. SMB public cloud adoption rates for current use/experimenting/planned

SMB respondents with future projects—indicated by the combination of the clouds they’re
experimenting with and planning to use—demonstrated the most interest in Google Cloud(31 percent), followed closely by VMware Cloud on AWS (22 percent) and Azure (20 percent).

© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

56

SMB adoption rates for both Azure and Google Cloud are increasing faster than the rates for
AWS, as Figure 53 indicates. Adoption of VMware Cloud on AWS, IBM Public Cloud, Oracle
Infrastructure Cloud and Alibaba Cloud rose year over year. However, only a small percentage
of SMBs still chose each one.

Figure 53. YoY SMB adoption rates© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

57

Maturity affects public cloud provider choice
Cloud maturity correlates to the length of time an organization has been using the cloud. That
correlation is due to the time it takes to build cloud expertise and create processes and bestpractices across the organization. Figure 54 indicates public cloud provider adoption basedon the organization’s cloud maturity level.
As the first large-scale cloud provider, AWS is used more frequently by organizations that havebeen using the cloud over a longer period—those at the advanced cloud maturity level. Acrossall respondents, 82 percent of advanced organizations use AWS compared with 74 percent
using Azure. In the intermediate cloud maturity category, Azure has a slight lead.
Azure enjoys higher adoption for cloud beginners for the second time, holding a sizable leadover AWS and Google Cloud.
Google remains in third place at all three maturity levels. But its popularity is significantly
higher, at 50 percent, within advanced maturity organizations.

Figure 54. Public cloud provider adoption based on cloud maturity level for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

58

Enterprises are growing their public cloud footprint
Cloud-first policies and cloud migration are top of mind for senior IT leaders, particularly inenterprise environments. As a result, enterprises are rapidly increasing public cloud spend
and workload volumes.
Cloud spend is a good indicator of how much an enterprise is using a public cloud provider.
As Figure 55 indicates, 53 percent of enterprises spend $1.2 million or more annually on AWS.
By comparison, 48 percent spend $1.2 million or more annually on Azure, indicating Azure’s
footprint is approaching that of AWS. Thirty-two percent of enterprises reported spending$1.2 million or more annually on Google.

Figure 55. Enterprise spend for top three cloud providers© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

59

The number of VMs or instances currently running in each cloud provides additional insight into
the size of organizations’ footprints within each cloud. For example, Figure 56 indicates that
Azure is now close to AWS among the larger footprint sizes. Fourteen percent of respondents
run more than 1,000 VMs in AWS compared to 12 percent in Azure.

Figure 56. Number of VMs enterprises use by cloud provider© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

60

Use of public cloud PaaS services is increasing
The number of public cloud users leveraging services beyond basic compute, storage andnetwork services continues to grow.

Most heavily used PaaS services have shifted
Organizations are increasingly leveraging the many PaaS services offered by cloud providers.
Figure 57 ranks the services that organizations are currently using, experimenting with orplan to use. The top three are data warehouse, relational database as a service (DBaaS) andcontainer-as-a-service. Organizations are driving this shift due to their growing interest inleveraging containers to speed deployment, scale operations and increase the efficiencyof workloads running in the cloud.
A look at the respondents experimenting with or planning to use a PaaS service sheds lighton their strategies. Almost half are experimenting with or plan to use machine learning/AI(46 percent), disaster-recovery-as-a-service (DRaaS) (45 percent), edge services (43 percent),
IoT (41 percent) and stream processing (42 percent).

Figure 57. Public cloud services organizations are using, experimenting with or plan to use© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

61

Enterprises use more PaaS services
Enterprises use more PaaS services overall than SMBs. Figure 58 lists the rankings forenterprise respondents. These respondents place relational database as a service (DBaaS),
container-as-a-service and data warehouse in the top three. While the current use of disasterrecovery-as-a-service (DRaaS) is lower on the list, it has the highest percentage of respondents
experimenting or planning to use the service. Machine learning/AI has the highest level ofexperimenting.

Figure 58. Public cloud services enterprises are using or plan to use© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

62

PaaS services use increases with maturity
Organizations increase their use of PaaS services as they mature, as Figure 59 indicates.
For example, advanced organizations use DBaaS (relational), container-as-a-service anddata warehouse significantly more than cloud beginners.

Figure 59. Services used based on cloud maturity for all organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

63

Private cloud plays important role
Most organizations are taking a multi-cloud, hybrid approach in which private cloud plays animportant role. As mentioned earlier in this report, about 80 percent of survey respondents
are running at least one private cloud (see Figure 10).
As in previous years, respondents reported on the technologies their organizations areusing to run private clouds. Figure 60 lists the technologies organizations are currently
using, experimenting with or planning to use. Respondents could choose more than one,as there can be overlap with some of these technologies.

Figure 60. Private cloud technologies organizations are using, experimenting with or plan to use© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

64

SMBs use private clouds less than enterprises
Figure 61 shows the ranking of the private cloud technologies enterprise respondents are
currently using, experimenting with or plan to use.

Figure 61. Private cloud providers enterprises are currently using, experimenting with or planning to use© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

65

Private cloud adoption by SMBs is lower overall than for enterprises. Figure 62 shows SMB
rankings for the technologies they’re currently using, experimenting with or plan to use.
Microsoft Azure Stack is the top choice, with 27 percent of SMB respondents currently using it.
VMware vSphere is in second place, cited by 20 percent of SMB respondents.

Figure 62. Private cloud providers SMBs are currently using, experimenting with or planning to use© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

66

Summary
The 2021 Flexera State of the Cloud Report reveals that COVID-19 had a significant impact on
cloud adoption in 2020. Multi-cloud continues to be the dominant strategy, adopted by nearly
all surveyed enterprises. The most common multi-cloud approach among enterprises is a mixof multiple public and multiple private clouds. The report also indicates that organizations are
becoming increasingly comfortable with putting even sensitive data in the cloud.
Due to its complexity and dynamic nature, the multi-cloud environment brings many
challenges, such as assessing the suitability of on-premises apps for migrating to the cloud.
The use of public clouds continues to grow dramatically in all organizations. This growth has
driven a significant increase in public cloud spend, and the COVID-19 outbreak may have
driven that spend even higher. As a result of continually increasing cloud spend, optimizing theexisting use of cloud (cost savings) continues to be the top cloud initiative for all organizations
for the fifth year in a row. Organizations are leveraging automated policies to continually scanand optimize their cloud costs.
The quest to reduce cost and the increasing adoption of DevOps are driving up the use ofcontainers. Docker and Kubernetes use remains strong, and many users are also adopting
container-as-a-service offerings from AWS, Azure and Google.
The growing migration to the cloud continues to affect organizational structure. Organizations
are increasingly establishing central cloud teams and centers of excellence to best leveragein-house expertise, especially in managing and optimizing cloud costs.
Organizations are moving to the cloud because of its scalability, economy and reach, andare using a variety of metrics to measure the resulting business value of cloud. The many
advantages delivered by the cloud have proven to be especially valuable as organizations
adapted over the past year to meet the rapidly evolving needs presented by the COVID-19
pandemic’s impact on business.

© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

67

FLEXERA™ 2021 STATE OF THE CLOUD REPORT:
Europe Spotlight
Despite a few differences, European organizations face similar challenges
and cite the same tech initiative priorities as their global counterparts.
Europe spotlight: introduction
The 155 European participants in the Flexera 2021 State of the Cloud Report survey represent about one-fifth of
the total survey audience. They’re executives and high-level managers in IT with significant knowledge of theirorganizations’ overall IT budgets. This Europe spotlight provides insight into their perspectives on the technology
and spend issues they face as they develop tech strategies and make technology choices. It includes comparisons
between European organizations and their counterparts in other parts of the world.

Europe spotlight: highlights• European companies are moving toward the cloud significantly more aggressively due to COVID-19
than companies in the Americas. Eighty-nine percent of European respondents have increased
cloud usage due to COVID-19 compared to 61 percent of respondents from the Americas• European respondents of the Flexera 2021 State of the Cloud Report survey were slightly moreadvanced in their cloud maturity than respondents from the Americas. Sixty-two percent ofEuropean respondents were advanced, compared to 58 percent of those from Americas• Top cloud migration challenges for European respondents are assessing technical feasibility (52 percent),
understanding app dependencies (49 percent) and rightsizing/selecting best instance (41 percent)• Top challenges of software in the cloud for European respondents were understanding
cost implications of software licenses (57 percent), ensuring we don’t use too manylicenses (49 percent) and complexity of license rules in public cloud (46 percent)• Top European cloud initiatives are migrating more workloads to the cloud (70 percent), optimizing
existing use of cloud (cost savings) (59 percent) and progressing on a cloud-first strategy (50 percent)• Ninety-five percent of European respondents use multi-cloud© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

68European respondent demographics
As Figure 63 shows, 56 percent of European participants work in organizations with 5,000 or more
employees, compared with 50 percent globally. Representation by European organizations with
1,001 to 5,000 employees is 28 percent, compared to 35 percent globally.

Figure 63. European respondents by organization size

© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

69

Figure 64 summarizes participation by industry. While the survey encompasses a cross sectionof industries, three have double-digit representation: financial services, technology services andsoftware. The Other category represents a variety of industries, with each representing less than
three percent of respondents.

Figure 64. European respondents by industry© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

70

Figure 65 summarizes European respondents by region. More than half (51 percent) are from theUK, 17 percent are from Germany and 13 percent are from France.

Figure 65. European respondents by region

Figure 66 indicates the breakdown of European respondents by level within the organization andby business role.

Figure 66. European respondents by level and by role

© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

71

Cloud has now become mainstream. As Figure 67 shows, more than half (62 percent) ofEuropean respondents use cloud heavily and have reached the advanced cloud maturity level,compared to 59 percent globally; four percent are beginners. Figure 68 provides a comparisonof organizational cloud maturity in Europe and in America.

Figure 67. European respondents by cloud maturity level

Figure 68. European respondents compared to Americas respondents by maturity level© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

72European cloud usage accelerates faster due to COVID-19
As Figure 69 shows, slightly higher than normal cloud usage in Europe due to COVID-19 is moreprevalent (by 24 percentage points) than it is in the Americas; the highest level of accelerationin Europe is four percentage points higher than in the Americas.

Figure 69. Accelerating cloud plans in Europe due to COVID-19© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

73

Seven in ten European respondents have cloud teams
or centers of excellence
European organizations allocate a lower percentage of revenue to IT spend than theircounterparts worldwide. In addition, as Figure 70 indicates, 70 percent of European
organizations have a central cloud team or a cloud center of excellence (CoE), comparedto 75 percent globally.

Figure 70. Adoption of central cloud team/CoE for European organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

74

Assessing technical feasibility is top cloud migration challenge
Without the best tools, assessing technical feasibility of migrating on-premises apps is difficult.
More than half (52 percent) of respondents reported assessing technical feasibility as the top
cloud migration challenge in Europe, as Figure 71 indicates.
Other critical challenges include understanding app dependencies, rightsizing/selecting the best
instance and prioritizing apps to migrate.

Figure 71. Cloud migration challenges for European organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

75

Managing software costs is challenging in the cloud
As Figure 72 shows, the top software-related challenge in the cloud is understanding the cost
implications of software licenses. As stated earlier, software asset management and vendor
management teams have considerable expertise in these areas; organizations would be welladvised to leverage their skills to address software challenges in the cloud.

Figure 72. Top software challenges for European organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

76

Migrating to cloud is top initiative
Migrating more workloads to cloud is the top European cloud initiative for 2021 (see Figure 73),
followed by optimize existing use of cloud (cost savings) and progressing on a cloud-first strategy.

Figure 73. Cloud initiatives for European organizations© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

77

Enterprises embrace multi-cloudEuropean enterprises have almost entirely embraced multi-cloud. As Figure 74 indicates,
95 percent of respondents reported having a multi-cloud strategy. Eighty-four percent are
taking a hybrid approach, combining the use of both public and private clouds.

Figure 74. European enterprises with a multi-cloud strategy© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

78

About Flexera
Flexera delivers IT management solutions that enable enterprises to accelerate thereturn on their technology investments. We help organizations inform their IT with total
visibility into complex hybrid ecosystems, so they can transform their IT by rightsizing
across all platforms, reallocating spend, reducing risk and charting the most effective
path to the cloud. Our technology value optimization solutions are delivered by 1,300+
team members helping more than 50,000 customers achieve their business outcomes.
To learn more, visit flexera.com
Contact us for more information or a demo:+1 800.809.5659 | +44 870.871.1111
sales@flexera.com
flexera.com© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

79

© 2021 Flexera. All rights reserved. This work by Flexera is licensed
under a Creative Commons Attribution 4.0 International License.

80