1. Voice of IT July 2012 TMThe Spiceworks Cloud Barometer:Insights into how small and mid-size companies use cloud services tosupport file sharing, email and productivity applications.A Spiceworks Market Insights Report sponsored by EMCTo say the IT market is going through a transformative period would be an understatement. Yes, cloudcomputing is changing the way businesses and individuals purchase and consume technology. Yes,consumerization and BYOD (bring your own device) are mashing together personal and business dataand applications on the sameMigration to yes, Cloud via smartphones, tablets and, soon, ultralight devices. And the mobilitynotebooks is on companies using the cloud today or in the next 6 months) (Based making accessibility to applications and data universal.70% 71%While much of the market calls cloud, consumerization and mobility transformative trends, theyreequally characteristic of a larger movement around comprehensive productivity. And what business60%9%couldnt use a little boost in output? Businesses and their employees are searching for ways to remain50%48%connected, collaborate, and share data while simultaneously having complete access to their personal 6%digital life. Consumerization is the trend driving the convergence of business and personal digital lives,40%but the trends of cloud computing and mobility are truly enabling consumerization.30%52% 20%To grasp how this is impacting small and mid-size businesses, Spiceworks conducted a study with 32320% 42%users across North America and EMEA to find out how the cloud is effecting three business applications 6%that influence employee productivity: file sharing/storage, email and productivity suites. Spiceworks is the10%14%worlds largest social business network for IT pros that offers free network management software coupled0%with an active community for discussion around all things IT. In 2011 alone IT professionals spent almostFile SharingEmail Productivitythree billion minutes in Spiceworks, making it one of the most active sites in the IT industry. SuitesUse TodayPlan to use in next 6 monthsMigration to the cloudUse cloud todayFile Sharing 52%9%61%Plan to use cloud in next 6 monthsEmail 42% 6% 48%Productivity Suites 14% 6% 20% 0%20% 40% 60%80% EMC on Spiceworks

2. Use Cloud Today52% 53%49% THE SPICEWORKS CLOUD BAROMETEREmail TotalNorth AmericaEMEAUse Cloud Today42% 43%37%Productivity SuitesTotal North America EMEAOverall, the findings show that productivity is a powerful lure. Cloud apps are in demand that reduceUse Cloud Today 14% 15% 13%burdens on internal IT management while simultaneously enabling access to data and applicationswherever and whenever users want. But SMBs struggle to find the best way to implement cloud-basedsolutions while maintaining their principles around data control and security.While both North American and EMEA companies have fairly similar usage rates across all of the cloud-services measured, North America leads the way in each category.Usage of the cloud today by region 60% 50%52% 53% 49% 40% 42% 43%37% 30% 20% 10% 14% 15% 13% 0% File Sharing EmailProductivity Suites TotalNorth America EMEA * Based on companies using the cloud today2 3. THE SPICEWORKS CLOUD BAROMETERCloud-based file sharing: the employee-driven appUsers want access to data whenever they want and from whatever device is in their hands.To facilitate universal data, a broad field of innovative cloud-based companies has popped up acrossthe landscape under the monikers of file-sharing, file synchronization and content managementservices. They all share the same basic characteristics: allowing users to store and back upunstructured data files (text, audio, video, images) in the cloud and making this data available ondemand via any Web-compatible device.Over half of respondents state theyre using cloud-based file sharing services in their organizationtoday and theres a distinct possibility every business has some level of file-sharing activity sinceemployees can bring these services in through the front door. This is true for 33% of respondents whostate they know their employees are using these services on their own and without approval. Another5% are not sure what their employees are doing. IT departments are mixed on how to manage thisbehavior with 31% of companies allowing employees to use any provider they wish and another32% discouraging the behavior at some level. This reluctance to implement policy indicates thatemployees and businesses want so badly to see the productivity benefits of file sharing that theymight loosen their standard around security, access control and data management.By region, North American companies are more likely to have an approved vendor for file sharing (25%vs. 12% for EMEA), while EMEA companies are more likely to have employees using file sharing serviceson their own (37% vs. 27% in North America).Company use and management of file sharing services Do your employees use any cloud-based file sharing services? FROM THE COMMUNITYHow does your IT department manageI tend to give more employee usage of cloud-based Yes, they are using them on their own 33%file sharing services?leeway to some users if(file sharing) will maketheir work-life a littleeasier without negatively8%24%31%Darko1884Spiceworks Userimpacting the company.community.spiceworks.com Yes, and we have an approved vendor19%12% 25% Nope, but planning toimplement these services inthe next 6 months9% Not Sure 5%We allow employees to useany provider they wishWe allow employees to use any provider,but we monitor bandwidthWe allow employees to use only thoseproviders approved by the IT department Nope 35% We discourage this behavior,but do not monitor itWe strongly discourage employees usingthese services in the office 284 Respondents89 Respondents3 4. THE SPICEWORKS CLOUD BAROMETERWhile accessibility, collaboration and convenience are the top advantages gained from cloud-based filesharing, businesses often feel insecure about the data thats being passed through these services. This iswhy the lack of control over data and security, legal liabilities and compliance issues, and reliability arethe top three concerns businesses harbor over file sharing. Only 6% have no concerns about file-sharingservices. While many file-sharing companies tout the security of their services and how protection of datais paramount, they still operate in the public domain and are not impenetrable to hackers and malware.Advantage and concerns with cloud-based file sharing What do you believe are the primary advantages ofcloud-based file sharing services? (Select top 3.) 80% 70% 76% 60% 50% 51% 40% 36% 30% 32% 20% 25%19% 14% 10%12% 3% 2% 0%I d nySt atu Co ari Co Ba uSe O leas LoEa se/i Ac omth e on ador recu ck rella ngnvase nt w feshfe pce an u frer spag st vaner up s atritbo caenss yw of erf,se tey coib h ra pa iee ag ilit enc sttio bi y re een/ litiacifce y eses 159 RespondentsWhat concerns does your company have withcloud-based file sharing services? (Select top 3.) 80% 70% 73% 60% 50%49%48% 40% 30% 36% 20%24% 10%4% 0% 6%W yc La ou rity O leasLe mp Re M eadEs nex e onth ean ac ck nd isanca pega li liaar cu p do cco h uer sp la ct ag heof da suebil li anc se n ern, tin ed lit emab e co ta s th s ygili nt / avenor costy roec e t /lyifts 156 Respondents 4 5. THE SPICEWORKS CLOUD BAROMETERWhen it comes to the selection of cloud-based file sharing providers, employees play an essential role.Employees have a clear preference for Dropbox with 87% of IT pros stating this is the vendor their employeesare using on their own. But vendor preference among IT pros isnt quite as clear. While Dropbox leads theway with nearly 30% of companies stating they use or plan to use them as their approved vendor, nearly40% are using a file sharing provider in the other category. This fragmentation among IT pros indicates thattheres no one solution thats accurately addressing the concerns of the IT department.Cloud-based file sharing vendor preference Employee Preference IT Pro Preference FROM THE COMMUNITY Which cloud-based file sharing What provider did you select or are you vendors are your employees using? most likely to select to supportI love Dropbox and use (Select all that apply)cloud-based file sharing for your it daily for my personal company? (Select only one) files. That being said I still have some concerns with corporate data being in aDropbox87% Dropbox 28% Dropbox account. IT Freak Spiceworks User community.spiceworks.comBox 8% Box 10%Egnyte0% Egnyte 8%TrendMicro 0% Trend Micro6%Other20% Other 37% Dont know 11% 93 Respondents 71 RespondentsOverall theres a clear desire for cloud-based file sharing services by small and mid-size businesses andtheir employees. But its evident, from the IT perspective, that the playing field for this category remainsopen and no one vendor has emerged as the clear leader for this service. Therefore vendors need tofind the right solution that addresses companies concerns around security, compliance and reliabilitywhile giving them what they want: complete accessibility, collaboration and low cost. Otherwise theemployee rather than the IT pro may be choosing the winner in this category.5 6. THE SPICEWORKS CLOUD BAROMETEREmail: onward movement up to the cloud,but on-premise still leadsWhen it comes to email, productivity improvement is the goal. The pursuit of productivity, though,is different from that of file sharing, mostly because of the nature of email systems and how theyrebound to a brand and domain. For that reason, businesses must sponsor their email system, whetherits on-premise or hosted.Hosted email offers the advantages of accessibility, scalable storage, management, administration andsecurity. This explains why 42% of companies have moved to a hosted email solution and another 6%plan to migrate in the next 6 months. These companies are most attracted to relieving administrativeburdens for their IT staff and the services ease of deployment. Surprisingly, security, storage andbackup features are not rated as the top motivating factors for implementing a hosted solution.By region, North American companies are slightly more likely to have a hosted solution vs. EMEAcompanies with 43% vs. 37% currently using a hosted solution.Hosted email adoption and reasons for migrationIs your companys email solution currently hosted or on-premise?FROM THE COMMUNITY52%42% 6% SpiceList*: How do youfeel about hosted email? On-PremiseCurrently HostedCurrently on-premise, but plan to move to a hosted solution within the next 6 months #1 I love on-site Exchange#2 Im not convinced 262 Respondents about outsourcing#3 Im already hosting and What are the primary reasons for moving your happy with my providercompanys email to a hosted solution? (Select top 3). #4 Considering moving, 60%but waiting for the right time 56%#5 Im looking to switch 50% from on-site to hosted 46% 46%40%* A SpiceList tells you what30%32%IT pros in the SpiceworksCommunity think about aparticular issue.20% 22% 21%18% For a complete list click here.16%10%7% 7% 4%0% DoAc anLo Co Cu Ot sSeRe sta EaBaStnwhe e s ce ytior cu st st se at plckdu ffITtkeromag ss meastritr, peup of cenocoib e ruefyersbde feilitct stw eaatsu plur u yt pe turduroy pp ecif oru re ees mor em nys seen ont airtl112 Respondents6 7. THE SPICEWORKS CLOUD BAROMETERMicrosoft dominates the on-premise email market with Exchange but in terms of cloud-based emailservice providers Google leads the way followed by Office 365. The almost 40% using other providersreflects the broad availability of POP3 and Exchange email services through service providers.Hosted email vendor preferenceWhat vendor are you using or looking to use to support your companys hosted email solution? (Select only one.) Office 365Go Daddy 34% 16%4% 3% 3% 40% Google RackspaceIntermediaOther116 RespondentsWhen selecting a hosted email service provider, reliability dwarfs all other considerations, includingsecurity and lowering costs. This deference speaks to the desire for improved productivity. Email outagescan cause significant business and revenue disruptions. Businesses often elect to retain their on-premiseemail because it gives them greater control over operations, information flow, security and support.Top selection criteria for hosted email vendors What are the primary considerations when choosingthe vendor for your companys hosted email solution? (Select top 3.) 80% 70% 75% 60% 50% 46% 40%40% 38% 30% 20%22% 10%17%17% 11% 9% 0%ReSe ur sLo er u Ea Ba St Ot aCoCulia orswcu tan ckhe seop(p s s e agts bitoes r up rit d leof r sp lit m tctru efy m ard d fey/ se eros ep ea ctat 2ee ssu t 4/ ur tu lour ec tspp7 e ym reesup ifysoren ) tim tt e113 RespondentsWhile hosted email is seen as a means for reducing IT burdens and increasing productivity, its still notthe preferred model. The survey revealed that 58% of businesses surveyed are currently using on-premise email, and only 6% of them will migrate to cloud-based email in the next 6 months. That makesfor a huge base of potential customers to convert, provided a service provider can clearly demonstratereliability, security and cost-containment. 7 8. THE SPICEWORKS CLOUD BAROMETERCloud-based productivity suites: the jurys still outWhen it comes to moving productivity suites to the cloud, which include word processing, spreadsheetand calendar applications, adoption is slow among SMBs. Cloud-based productivity suites have thelowest adoption rate among the three applications reviewed in this study. Nearly two out of threebusinesses have no plans to use cloud-based productivity suites. Only 14% of those surveyed arecurrently using cloud-based productivity suites, and another 22% are thinking about adopting theseservices sometime in the future.North American companies are marginally more likely to adopt cloud-based productivity suites, with38% currently using or planning to adopt vs. 30% of EMEA companies.Adoption of cloud-based productivity suitesDoes your company use or plan to use any cloud-based productivity suites forword processing, spreadsheets, etc.? 14%6% 15%64% Yes Yes, within the next 6 monthsYes, but not sure whenNope 247 RespondentsThis low adoption rate is consistentor thinking about usingresearch: According to the Cloud & Technology What vendor are you using with other industry for your cloud-basedTransformation Alliances 2012 State ofsuite? (Select only one)productivity the Cloud Channel1 report, demand for cloud-based productivityincreased a scant 6% compared to 22.5% for cloud backup and 23% for cloud storage.Does your company use or plan to use any cloud-based productivity suites for48% 43%word processing, spreadsheets, etc.? 8%When it comes to cloud productivity suites, there are only a handful of choices beyond the two marketleaders, Microsoft and Google. This explains theOther (pleasebetween Google Apps and Office 365. Google Google AppsOffice 365 polarity specify)14%6% 15%64%has surprised many with its ability to grow market share in an application segment dominated byMicrosoft. Still, its not all that surprising given that Google is, by its very nature, a cloud native. Yes Yes, within the next 6 monthsYes, but not sure whenNopeCloud-based productivity suites vendor preferenceWhat vendor are you using or thinking about using for your cloud-basedFROM THE COMMUNITY productivity suite? (Select only one)Over 60,000 IT pros arefollowing Office 36548% 43%8% or Google Apps in theSpiceworks Community. Google Apps Office 365Other (please specify)community.spiceworks.com 83 Respondents 8 9. THE SPICEWORKS CLOUD BAROMETERThe adoption rationale and the purchasing considerations for cloud productivity suites virtually mirroreach other, with ubiquitous accessibility, collaboration features, and lower cost topping the list. Costsavings is a secondary consideration, but significant since cloud-based productivity suites typicallyhave a lower acquisition cost but a longer total cost of ownership given their open-ended recurringsubscription fees.Top reasons for migration and vendor selection criteriafor cloud-based productivity suitesWhy have you moved or plan to move to a cloud-basedproductivity suite solution for your company (Select top 3.)70%69%60%50% 54%40%37%30% 30%20% 25% 24% 21% 20%10% 7% 2%0% Ac yhCo ariLo r uEa very St Se r s Em reaBaEa r Ot a ce we or ansie onw secu tanlla ng se c sh pe eoual ck he pl dyin (pag ss re er r rit dbo cart e oy usuptele of er ibefcoy m ardo up ee ing ra pa ilit usfasefe ea ke t sttio bisa t at e/y ee s spep o dtu fro urn/ liti re hetsecrees m s ify ) ates me84 Respondents What are your companys top considerations for selectingyour cloud-based productivity suite vendor? (Select top 3.)50%44% 43%40%42%30% 33% 31% 31%20% 16% 15%10%14%12% 2%0% Ac ywCo Co ari Lo Se ur s Ba St W ec Ea ter Em rea Ot lea ce he or anwcu tanev omck mlla ngse facsh ilityo he se th in al atu (Ppl dyag ss reer uppa rit d bo caew pof eroy us ibefcoy m ard tibra pafe ilitusee ing or any est tio bi ate/sa tyfee s ke b sp peurn/ liti ro ts re he d efoecre es rumw res ify se ith ) r es m81 Respondents 9 10. THE SPICEWORKS CLOUD BAROMETERGiven that current vendor preference in this category is essentially a horse race between Google andMicrosoft, itll be interesting to see how adoption trends continue as Microsoft dives deeper into mobileplatforms and lightweight endpoint devices powered by Windows 8 and Windows Phone 8. Itll also beintriguing to watch how Google continues to challenge Microsoft with the release of new versions of itsoperating system Chrome, flavors of the Android operating system, and hardware such as Chromebooksand the new Nexus 7 tablet.Wrapping UpThe core tenets of cloud computing are scalability, elasticity, flexibility, accessibility and costcontainment all of which add up to greater productivity. Cloud-based applications such as file sharing,email and productivity suites are proving tremendously adept at producing the tangible results desiredby business, particularly by SMB and midmarket companies.However, concerns and objections to these cloud services persist. Security, reliability and true-valuedoubts will hinder adoption as on-premise applications prove exceedingly resilient despite not havingthe same levels of accessibility and ubiquity. Nevertheless, the draw to cloud apps is evident with filesharing leading the charge. As a mechanism for moving around documents with greater efficiency, filesharing extends the value and usability of on-premise applications such as email and productivity suites.Cloud-based applications such as file sharing, email and productivity applications will only becomemore appealing as their reliability and usability increases. Businesses will continue to expand their use ofthese services as they search for applications and resources that reduce overhead costs while increasingproductivity and output. This report was sponsored by EMC.EMC Corporation is a global leader in enabling businesses andservice providers to transform their operations and deliver IT as aservice. Fundamental to this transformation is cloud computing.Through innovative products and services, EMC acceleratesthe journey to cloud computing, helping IT departments tostore, manage, protect and analyze their most valuable asset information in a more agile, trusted and cost-efficient way.Additional information about EMC can be found at www.EMC.com. 10 11. THE SPICEWORKS CLOUD BAROMETERRespondent Profile44% IndustryEducation HealthcareFinanceNon-ProfitConsulting 17% 10%8% 7% 6% 5% 5% 5% 4% 3%31%32% IT Service ProviderManufacturing Retail Engineering Software OtherSample = 259Company SizeRegion250+ employees100-249Northemployees7%America 18% 44% 52% 48%32% EMEA 1-19 employees20-99 employeesSample = 282Sample = 281References12012 State of the Cloud Channel, Cloud & Technology Transformation Alliance (The 2112 Group and VirgoPublishing), March 2012About Spiceworks Voice of ITThe Spiceworks Voice of IT market Insights program publishes stats, trends and opinions collected from smalland medium business technology professionals that are among the more than 2M users of Spiceworks. Surveypanelists opt-in to answer questions on technology trends important to them.About SpiceworksSpiceworks the worlds largest social business platform for IT, connects 2 million IT professionals with more,than 1,200 technology brands. By combining a Facebook-like community with free IT management software,Spiceworks helps businesses to discover, buy and manage $350 billion worth of technology products andservices each year.To learn more, visit: Be first to hear about Spiceworks Voice of IT insights, email:http://www.spiceworks.com/voice-of-it marketresearch@spiceworks.comThe contents in this report are a result of primary research performed by Spiceworks. Unless otherwise noted, the entire contentsdistributed as part of this report are copyrighted by Spiceworks. As such any information made available by any means in this report maynot be copied, reproduced, duplicated, published, displayed, transmitted, distributed, given, sold, traded, resold, marketed, offered for sale,modified to create derivative works or otherwise exploited for valuable consideration without prior written consent by Spiceworks. Formore information visit www.spiceworks.com/voice-of-it/terms.This report contains information of fact relating to parties other than Spiceworks. Although the information have been obtained from, andare based on sources that Spiceworks believes to be reliable, Spiceworks does not guarantee the accuracy, and any such information mightbe incomplete or condensed. Any estimates included in this report constitute Spiceworks judgment as of the date of compilation, and aresubject to change without notice. This report is for information purposes only. All responsibility for any interpretations or actions based onthe information or commentary contained within this report lie solely with the recipient.All rights reserved. 2012.11