Gen AI interest is helping push cloud investment to a new high

Interest around Generative AI has proven instrumental to rising cloud investment in recent months, new research has suggested.

Wipro's ‘Pulse of Cloud: Quarterly Report July 2024’ report claims more than half (54%) of organizations now cite AI as the top motivator for their cloud expenditure.

However, despite the increased attention on artificial intelligence, companies are now reporting challenges regarding cost management, particularly with cloud costs soaring.

Companies are investing in cloud because of AI

In particular, the report said more than two in five (43%) UK organizations admitted lacking a coordinated approach to managing cloud costs, which is considerably more than neighboring nations like Germany (24%) and France (25%).

The figures illustrate the challenge business leaders are facing when it comes to balancing the productivity benefits of AI with increasing expenditure on IT services and infrastructure.

Despite increasing interest in AI, 55% say their cloud adoption is currently outstripping AI adoption, with only one-in-three (35%) advancing with both at a similar rate.

“The importance of an effective cloud strategy is only amplified with the increasing focus on AI… cloud investment decisions are increasingly being driven by the need to support AI," noted Jo Debecker, Managing Partner and Global Head of Wipro FullStride Cloud.

Moreover, the report also revealed more than half of the surveyed organizations plan to increase investments in both hybrid (54%) and public (56%) cloud infrastructures. Three in five (60%) are already using hybrid cloud, suggesting growing attention to balancing cost-effectiveness with flexibility and convenience.

With the power of such technologies and their costs rising simultaneously, businesses must keep a close eye on their spending in order to optimize the outcomes.

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