Microsoft study shows slow but steady SMB cloud adoption

Only 39 per cent of small-to-medium sized businesses (SMBs) expect to be using one or more cloud services in the next three years, according to research from Microsoft, despite the fact that this sector of the market should gain the most from an on-demand model of IT service delivery.

The figures come from Microsoft's SMB Cloud Adoption Study 2011, which questioned 3,258 companies with up to 250 employees across 16 countries worldwide, including the UK.

Not surprisingly, the survey found that small companies that have already adopted cloud services are using it for email, collaboration, accounting and payroll, applications that are most readily amenable to software-as-a-service (SaaS) delivery.

Microsoft claimed that 39 per cent of SMBs expect to be paying for one or more cloud services within three years, approximately a one-third increase on the 29 per cent already doing so today.

However, the number of services used by these cloud customers is expected to nearly double within the same time, from two or fewer to three or more.

Microsoft also found that the larger the company, the more likely it is to adopt cloud services; over half of firms with 51 to 250 employees stated that they will use at least three cloud applications within three years.

"Cloud adoption will be gradual, and SMBs will continue to operate a hybrid model with an increasing blend between off-premises and traditional on-premises infrastructure for the foreseeable future," said Microsoft's vice president for business channels, Marco Limena.

This is only to be expected from a Microsoft survey, as the company is known to view the SaaS application delivery model as a threat to its lucrative product lines such as the Office productivity suite.

However, Microsoft also reported that cloud service adoption does not appear to be limited to fast growing small companies, which need a service delivery approach that lets them easily scale up as they grow in size.

Many SMBs see cloud delivery as a way of cutting costs by delivering applications more efficiently, the company concluded.

Nevertheless, cloud will not replace everything, and about a third of applications and services are likely to remain on-premise, according to Microsoft.