IBM’s hybrid cloud revenues on a steady rise in India

BENGALURU: Technology major IBM Corp. has been witnessing a steady rise in hybrid cloud revenues in India as the pandemic has accelerated the digital transformation journey for many organisations, a company executive said.

IBM’s cloud revenue grew 34% during April-June, up from 23% in the preceding quarter, making it their strongest quarter for cloud growth in more than three years. Globally, IBM’s hybrid cloud platform has generated more than $23 billion in revenue over the last 12 months.

In India, it clocked "double digit" growth for cloud in 2019 led by its data, artificial intelligence (AI), and security business, Viswanath Ramaswamy, vice president, IBM Cloud and Cognitive Software & Services, IBM India/South Asia, said in an interview.

Data forms the backbone of technologies like AI that helps organisations in functions like predictive analysis and pattern recognition to forecast sales and demand. IBM’s ‘Cloud Pak for Data’ is an integrated data and AI platform that helps businesses integrate AI into their data analysis.

The rise in cyber security threats as a result of the pandemic has also contributed to the growth in the cloud business. “Customers want to infuse AI into their workflows and secure their IT infrastructure to mitigate the growing cyber security threats,” Ramaswamy said.

The adoption of hybrid cloud is being driven by sectors such as financial services, telecom, retail, auto, manufacturing, and government. "They realise the advantage leveraging hybrid cloud platform and it being the key enabler for innovation," he said.

According to a recent IBM study, with businesses embracing digital more than ever before, the majority of their cloud budgets are being allocated to hybrid cloud platforms as they offer improved business performance and greater return on investments. As a result, IT companies are increasingly focusing on building their cloud portfolio both through organic and inorganic investments.

IBM is focusing on helping clients in two of their major digital transformational initiatives – hybrid cloud and data & AI. Although hybrid cloud is the “dominant force” driving change in the industry, it is far from universal adoption, Ramaswamy said. “Only 20% of the workloads have moved to the cloud while the other 80% are mission-critical workloads that are far more difficult to move. There’s a massive opportunity in front of us to capture these workloads.”

The company has so far invested $1 billion in its hybrid cloud initiative globally to support the partner ecosystem and provide clients with a seamless and secure transition to the cloud. In the last six months, Ramaswamy said IBM has strengthened its long-term partnerships with system integrators in India including Infosys Ltd, Wipro Ltd, Tata Consultancy Services (TCS) Ltd, Tech Mahindra Ltd, and Persistent Systems Ltd.

IBM has also invested in inorganic growth over the last few years. Last year, it acquired open source enterprise software giant Red Hat for $34 billion to build its dominance in the hybrid cloud market. Earlier this year, it acquired Spanugo, a US-based cloud cyber security startup to build on its cloud portfolio for regulated industries.