Tata Consultancy Services (TCS) has revealed the top five cloud trends it believes will shape global enterprise in 2023: Cloud 2.0, sovereign cloud, 5G and edge computing, industry cloud, and the emerging cloud talent gap.

The predictions form part of TCS’ latest guidance about which cloud innovations are most likely to influence the C-suite and how businesses can best navigate these trends effectively and profitably, while avoiding any potential pitfalls.

The insights from TCS come as cloud adoption continues to increase, with Gartner forecasting global cloud services will grow over 20% to $591,8-billion in 2023, despite inflation and economic uncertainty putting pressure on corporate spending.

The rapid pace of change has left many business leaders anxious and confused about their technology investments, but this new era demands better strategic planning and a long-term vision, according to Parthiv Shah, global managing partner of cloud strategy and transformation at TCS.

“With more than 616,000 employees operating in the cloud, and almost all of our customers utilizing TCS’ cloud services, what’s next for cloud is top of mind for TCS,” says Parthiv. “Technological advancements are expanding and converging with each new day, so a clear focus on investing in the right cloud infrastructure is one of the most important decisions any enterprise will make in 2023. Business leaders need to understand that the cloud is now an essential business strategy – not just an IT solution.”

Here are the five essential trends that businesses must monitor for cloud success in 2023:


Cloud 2.0

Cloud will enter a new phase becoming a core pillar of business strategy.

Many initial cloud investments were made in a rush during the onset of the Covid pandemic to cater to remote working or a short-sighted goal of cost-savings.

Now the global economy is forcing businesses to evaluate the true value of their cloud strategies by using metrics and businesses are starting to shift focus to fine-tuning their cloud-value evaluation models and asking how it can support customers or diversify revenue sources.

This new perspective positions the cloud as a core pillar of modern business strategy which is crucial for driving growth, transformation, and continuous innovation.


Sovereign cloud

New data privacy regulations will push enterprises into sovereign cloud.

Sovereign cloud is a security posture that any organisation can take to safeguard valuable data and systems from unauthorised foreign access on either a country or local level.

The United National Conference on Trade and Development reports that over 70% of countries worldwide have passed data and privacy laws which are prompting organisations to add sovereign cloud to their multi, hybrid, and poly-cloud strategies for regulatory compliance.

This is set to make smart system integrations, interoperability and portability more complex but imperative in 2023 and beyond.


Cloud innovation

5G and edge computing will significantly accelerate business operations.

By bringing computation and storage closer to data sources, businesses can improve their response times and save bandwidth, while advances in the edge cloud are set to multiply applications on the frontlines of businesses, including in-store and on-site operations and sustainability solutions.

Although still in the early stages of development, quantum computing is inching ever-closer to reality with an increasing number of companies preparing to adopt quantum capabilities.

Dramatic progress in artificial intelligence, machine learning, virtual reality and augmented reality for eventual immersion in the metaverse, is also expected to deepen cloud’s role in modern business and everyday life.


Industry cloud

Enterprises will begin reaping the rewards from their industry-specific cloud investments.
Cloud computing can be uniquely tailored for specific sectors to deliver business value, not just more effective back-end IT operations.

From fast-changing supply chains to energy efficient sustainability initiatives, smart businesses that are investing in industry cloud-native solutions to address common pain points can expect a significant boost in their KPIs.

Consumer-facing sectors – like retail and hospitality – will also see growth in industry cloud activity, as they are best positioned to make immediate use of edge computing. We expect industry-specific cloud success stories to flourish from this year onwards.


Shifting talent

The talent gap will widen as cloud technologies evolve and demand new digital skillsets.

The cloud is creating new opportunities for companies and employees, but the challenge is training staff to become multi-cloud architects. This will take a collective global effort across enterprise, government, academia and industry bodies to equip employees with the training and tools to thrive in the new era of cloud innovation.

We expect a race for top talent contrasting against the broader pressures on workforces due to the economic downturn. Businesses must double-down on training, retraining, and retaining their staff if they are to turn their vision for a cloud-powered business into reality as quickly as possible.

Parthiv adds: “Cloud spending will continue to face scrutiny given the global economic headwinds. But we believe it will endure and, in fact, increase, especially in the medium- to long-term.

“New technologies and collaborations are driving innovation and will continue to deliver precisely the types of cloud-powered services becoming vital to global business. Companies that proactively develop ‘cloud-first’ strategies to address and master these new trends will be dramatically better-positioned to realize healthy returns on their investments into 2023.”