Future Growth of Cloud Storage: 11 Trends

Cloud storage has gone mainstream. Once a niche technology, it's now embedded in our personal and professional lives. Chances are you relied on some form of cloud storage today without even realizing it. But the cloud storage landscape is evolving quickly. New technologies and shifting consumer demands are fueling rapid change.

This article will explore 11 key trends set to shape the future of cloud storage. By understanding these forces, you’ll see why the industry is poised for massive growth in the years ahead. Whether you’re a consumer who loves the convenience of the cloud, or an enterprise evaluating providers, these insights will help you navigate what’s coming next. Let’s dive in.

Trend 1: Small Businesses Ditching On-Premise Storage for the Cloud

Not long ago, most small businesses ran all their technology on-premise. They would purchase servers and equip on-site data centers to handle storage needs. But maintaining your own storage infrastructure is a headache for small companies. It requires big upfront costs, extensive IT skills, and ongoing maintenance. Now, small businesses are migrating storage to the cloud en masse. Cloud storage gives them enterprise-grade capabilities without the hassle or expense of managing on-site infrastructure.

Consider these statistics:

  • 92% of small businesses say the cloud helps them compete with larger rivals on technology capabilities. (Salesforce)
  • 75% of small businesses will operate fully in the cloud by 2025, compared to just 41% in 2019. (SMB Group)

Trend 2: Video Streaming Driving Consumer Cloud Storage Demand

Have you ever run out of storage space on your smartphone? Chances are good, considering our phones are now packed with photos, videos, and music. Now multiply that by the billions of smartphone users worldwide. Our appetite for storing digital content keeps growing, especially bandwidth-hungry video. Cloud storage provides virtually unlimited capacity for consumers to offload and back up content.
Consider the following:

  • Video streaming accounts for over 80% of all internet traffic today. (Sandvine)
  • The average person will store 1.7TB of data in the cloud by 2025, 6X more than in 2016. (ScienceDirect)

Trend 3: The Internet of Things Driving Enterprise Cloud Demand

Within companies, the Internet of Things (IoT) revolution is also fueling cloud storage adoption. IoT means Internet-connected smart devices like sensors, cameras, and vehicles. By 2025, the world will contain over 25 billion IoT devices. For context, that’s 3 devices for every human being on Earth! All those devices generate data - lots of data. That data gets transported to the cloud to derive insights using big data analytics.

Consider the impact:

  • Enterprise IoT data will reach 73 zettabytes by 2025, 10X more than all data on the internet today. (IDC)
  • 45% of companies say IoT is driving them to increase cloud usage and spending. (Cisco)
  • Innovations like self-driving cars will generate even more real-time data needing analysis. The IoT revolution will massively scale enterprise cloud storage demand.

Trend 4: Hybrid Cloud Storage Adoption Accelerating

Historically, companies faced a binary choice. Either keep storage on-premise or shift everything to the public cloud. But a hybrid approach combining on-premise and cloud is rapidly gaining popularity. Organizations run critical systems locally while offloading data to the cloud.

Hybrid cloud storage gives enterprises the best of both worlds - security of on-premise, and scalability of the cloud:

  • 74% of companies now use a hybrid cloud model, up from just 51% in 2018. (RightScale)
  • 82% of enterprise workloads will be hybrid cloud by 2025, up from 44% in 2019. (SecurityIntelligence)
  • As companies strategically move more storage to hybrid environments, adoption of cloud-based capacity will grow.

Trend 5: Compliance Driving Cloud Storage at Regulated Companies

For highly regulated industries like finance and healthcare, staying compliant is a top priority. Failure to secure sensitive data invites huge fines.

Cloud storage can actually help regulated organizations improve compliance by:

  1. Centralizing scattered systems containing regulated data
  2. Automatically classifying and tagging sensitive data
  3. Providing visibility into access controls and permissions

The proof is in the numbers:

  • 93% of healthcare IT leaders say the cloud has enhanced their data compliance capabilities. (Pure Storage)
  • 75% of banks already use cloud storage specifically to help meet regulatory requirements. (Accenture)
  • Expect compliance needs to fuel substantial enterprise cloud storage growth in regulated industries.

Trend 6: Artificial Intelligence Shaping the Competitive Landscape

Artificial intelligence and machine learning unlock hidden insights from data. Forward-thinking storage vendors now use AI to enhance security, searchability, analytics, and automation.

Consider examples:

  1. AI can instantly translate speech to text in videos stored in the cloud.
  2. ML helps predictively cache frequently accessed files locally to speed retrieval.
  3. Analytics identify dormant data to archive and save costs.
  4. The impact of AI and ML integration will become an increasingly important competitive differentiator:
  • By 2025, 47% of storage operations will be automated using AI/ML, compared to just 20% in 2021. (ESG)
  • As vendors race to embed intelligence in their platforms, AI and ML capabilities will directly shape cloud storage innovation.

Trend 7: Individuals Seeking Enhanced Privacy and Security

Despite the convenience of the cloud, consumers still have reservations. Recent high-profile hacking incidents undermine trust. In one survey, 63% of consumers cited data privacy and security as their top concern about cloud storage. They want greater control over their data.

New technologies are emerging to satisfy these demands:

  • 85% of consumers are interested in decentralized cloud storage for enhanced privacy. (Finder)
  • Client-side encryption secures data before syncing to the cloud.
  • As consumers weigh privacy risks, they will increasingly favor providers offering verifiable security protections.

Trend 8: Decentralized Storage to Challenge Legacy Providers

Today's dominant cloud storage platforms use centralized architecture. This consolidates control over data in few companies. Decentralized storage systems take a different approach. User data gets encrypted, shredded, and scattered across a peer-to-peer global network. Advocates argue this architecture reduces single points of failure, protects privacy, and prevents vendor lock-in.

Consider the momentum behind this trend:

  • Decentralized storage networks, like ShdwDrive, will grow at a CAGR of 63% through 2030. (ResearchAndMarkets)
  • While early-stage, decentralized storage could substantially disrupt legacy vendors as the technology matures.

Trend 9: Data Sovereignty Concerns Accelerating in Europe

Data sovereignty refers to the concept that data subject to a country’s laws must reside within its borders. Europe leads the push for “data localization” laws that restrict exporting citizen data overseas. These regulations present challenges for global cloud providers.

Consider what’s driving this trend:

  • 90% of European small businesses want cloud data stored in the EU to avoid foreign surveillance. (TOPIA)
  • Countries like Germany, France, and Italy have enacted strict data sovereignty protections.
  • To serve European customers, storage providers will increasingly localize data in-region. This complicates operations but satisfies regulatory obligations.

Trend 10: Sustainability Initiatives Lowering Cloud Emissions

Operating the massive data centers underpinning cloud storage consumes substantial electricity.
This contributes to tech’s carbon emissions. But providers are pivoting to sustainable practices like renewable energy and carbon offsets to mitigate environmental impacts:

  • The global cloud computing industry has pledged to reach net-zero carbon emissions by 2030. (TechCrunch)
  • Top vendors like AWS, Google Cloud, and Microsoft aim to power their operations entirely using renewable energy this decade.
  • “Green cloud” initiatives will enable vendors to capture growing consumer and business demand for sustainable IT products and services.

Trend 11: Specialized Solutions for Industry Verticals

Many cloud storage vendors take a horizontal, one-size-fits-all approach targeting all industries.
But niche solutions are emerging tailored to the unique needs of verticals like:

  • Genomics research - massive datasets plus genomic data privacy regulations
  • Autonomous vehicles - real-time ingestion and analysis of petabyte-scale driving data
  • Finance - integrated regulatory compliance tools
  • Although smaller markets, customized vertical solutions earn strong loyalty from customers within that industry. Specialization will be an ongoing theme.

Key Takeaways

What overarching themes emerge from these 11 trends?

First, demand is surging from businesses both large and small. Cloud storage lets them cost-effectively scale capacity while gaining enterprise-grade capabilities.

Second, consumers’ appetite for secure and private personal storage continues growing, especially for bandwidth-hogging video.

Third, decentralized storage offers compelling advantages but has maturation and adoption challenges to overcome.

And finally, integration, intelligence, sustainability, and specialization will dictate product innovation and differentiation going forward.

One certainty is the cloud storage landscape five years from now will look much different than today. By understanding where the industry is headed, you can anticipate what’s coming next. So there you have it – 11 trends fueling the rapid growth and future of cloud storage. Cloud innovation shows no signs of slowing down. The companies that adapt fastest will reap the rewards.