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Highlighting the gap between AI leaders and AI laggards and explaining the value of a unified data approach
NetApp® (NetApp, Nasdaq: NTAP), a global leader in cloud-led, data-centric software, today released its second annual Cloud Complexity Report.
The report analyzes the experiences of global technology decision-makers deploying AI at scale, revealing a stark contrast between AI leaders and AI laggards. This year's report offers global insights into progress, readiness, challenges, and momentum since the report's launch last year, highlighting what AI leaders and laggards can learn from each other and explaining the critical role of a unified data infrastructure in achieving AI success.
“AI is only as good as the data that fuels it,” said Pravjit Tiwana, Senior Vice President and General Manager, Cloud Storage, NetApp. “What we are seeing from both AI leaders and laggards is that in common hybrid IT environments, the more integrated and trusted the data is, the higher the likelihood that AI initiatives will succeed.”
A Significant Gap Exists Between AI Leaders and AI Laggards
According to the report, a clear gap exists between AI leaders and laggards across several areas.
· Region: AI-leading countries (India, Singapore, UK, USA) see 60% of companies running or piloting AI projects, compared to just 36% in laggard countries (Spain, Australia/New Zealand, Germany, Japan).
· Industry: Technology leads the way with 70% running or piloting AI projects, followed by banking and financial services and manufacturing at 55% and 50%, respectively. Healthcare (38%) and media and entertainment (25%) are lagging somewhat behind.
· Company size: Large enterprises with 250+ employees are more likely to be running or piloting projects at 62%, compared to just 36% for small enterprises with fewer than 250 employees.
AI leaders and laggards also differed in their approach to AI.
· Globally, businesses in AI-leading countries reported a 67% prevalence of hybrid IT environments, with India leading the way at 70% and Japan trailing at 24%.
· AI leaders are also more likely to report benefits from AI, including a 50% increase in production speed, 46% increase in automation of routine tasks, and a 45% improvement in customer experience.
“With AI on the rise, we’re entering a new era of innovate or die,” said Gabie Boko, Chief Marketing Officer, NetApp. “Organizations that are data-ready—connecting and integrating a broad range of structured and unstructured datasets into an intelligent data infrastructure—are best positioned to succeed in the AI era.”
AI Laggards Must Innovate Quickly to Remain Competitive
Despite the gap, there’s been notable progress among AI laggards in preparing their IT environments for AI, but the window of opportunity to catch up is quickly closing.
· A significant number of businesses (42%) in AI laggard nations, including Germany (67%) and Spain (59%), have optimized their IT environments for AI.
· Some businesses in AI laggard nations have already built unified data infrastructures and report the following benefits:
- Easier data sharing: Spain (45%), Australia/New Zealand (43%), and Germany (44%)
- Improved visibility: Spain (54%) and Germany (46%)
Rising IT Costs and Data Security Won’t Halt AI’s Advancement
While rising IT costs and securing data are top of mind in the AI era, they won’t stop AI’s advancement. Instead, AI leaders will likely downscale, reduce other IT operations, or reallocate funds from other parts of the business to support AI initiatives.
· AI leaders will also increase CloudOps, data security, and AI investments over the next year, with 40% of large companies already reporting increased IT costs due to AI projects.
· ‘Increased cybersecurity risks’ saw a 16% jump year-over-year from 45% to 61%, rising to become the biggest concern, while all other concerns have decreased.
· 31% of global businesses are reallocating funds from other business areas to manage AI project costs, with India (48%), the UK (40%), and the USA (35%) leading the trend.
Security, AI, and CloudOps Will Drive Cloud Investments in 2024
Regardless of whether they are AI leaders or laggards, global businesses are increasing investment and relying on the cloud to support their objectives.
· Businesses expect to increase AI-driven cloud deployments by 19% between 2024 and 2030.
· 85% of AI leaders plan to increase cloud operations automation next year.
· Increased data security investments are a global priority, expected to rise from 33% in 2023 to 58% in 2024, a 25% increase.
Methodology
In March 2024, NetApp partnered with Savanta to conduct quantitative research with over 1,300 technology and data executives at businesses across 10 markets: the US, EMEA (UK, France, Germany, Spain), and APAC (Australia, New Zealand, India, Singapore, Japan).
To learn more and access the full report and infographic, visit https://www.netapp.com/netapp-intelligence/cloud-complexity-report/.
Join NetApp and Steve McDowell of NAND Research for a LinkedIn Live event on April 23 at 11:00 AM ET via the link below:
https://www.linkedin.com/events/netapp2024cloudcomplexityreport7186755671692873730/theater/
Additional Resources
2024 Cloud Complexity Report: The AI Gap
Cloud Complexity Report Infographic
About NetApp
NetApp is an intelligent systems company that helps organizations transform their data into a powerful asset to drive innovation. NetApp combines unified data storage, integrated data services, and cloud operating solutions to turn disruption into opportunity for every customer. NetApp builds infrastructure without silos, leveraging observability and AI to deliver industry-leading data management. NetApp’s data storage is the only enterprise-grade storage service native to the world’s largest clouds, enabling seamless agility. Its data services create a data advantage with unparalleled cyber resilience, governance, and application agility. Cloud operating solutions use observability and AI to continuously optimize performance and efficiency. With NetApp, you can transform your data infrastructure and realize business potential, regardless of data type, workload, or environment. Learn more at www.netapp.com or follow us on X, LinkedIn, Facebook, and Instagram.
NETAPP, the NETAPP logo, and the marks listed at www.netapp.com/TM are trademarks of NetApp, Inc. Other company and product names may be trademarks of their respective owners.
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