Ship it!

We have just completed the research and analysis for the 2022 Accelerate State of DevOps Report (SODR) and oh boy, do we have some interesting things to share! First, let me take a short step back for those of you that may be new to the DevOps Research and Assessment (DORA) and our annual report, the SODR. DORA is an academically rigorous research program that seeks to answer the questions, What practices enable teams to be high-performing software teams? And how do these practices impact organizational performance?

Since 2014, we have surveyed 33,000 practitioners around the world spanning all major industries. The project is intentionallyand staunchlytool- and platform-agnostic. The research builds on itself, and each year we seek to both evaluate previous findings and expand in other directions or areas of research. This is important to note because many of the core findings, such as software delivery performance drives organizational performance, have been validated year after year. I would encourage you to go back and read all the reports from years past.

This year, we doubled down on our 2021 research into software supply chain security by looking at the technical practices that improve software supply chain security and the non-technical practices that impact an organizations ability to excel at securing their software supply chains. We leveraged two frameworks to focus our research: Supply Chain Levels for Software Artifacts (SLSA) and NISTs Secure Software Development Framework (SSDF). Below is a summary of some of our key findings in this area:

Our research showed that companies who prioritize and excel at securing the software supply chain experienced fewer service outages, anticipate fewer security breaches and demonstrate high levels of both software delivery performance and organizational performance. The data showed that through the use of modern practices like continuous integration, teams can improve their security posture and even amplify the positive impact these security practices have on software delivery metrics (MTTR, deployment frequency, lead time-to-restore service) and overall organizational performance.

We saw above that the biggest predictor of an organizations application development security practices was the presence of a generative organizational culture based on shared risk and information sharing. We also see that elements of these types of cultures lead to higher overall organizational performance, as well. Our research showed that high organizational performance can be achieved by fostering environments that are:

We also looked at burnout again this year and expanded the scope to understand which elements of culture contributed to lower levels of burnout. We found that generative culture, team stability and work flexibility all contributed to a reduction in burnout among employees.

In previous years, our research told us that those that excelled in technical practices also excelled at organizational performance. This year, we have more nuanced data about this topic. This year, we saw that software delivery does not predict strong business outcomes unless these practices were paired with reliability. Think about itwill a customer be satisfied with new features if the service isnt stable? What is the benefit of pushing code quickly into a fragile environment? Reliability is an essential component of driving organizational performance through software delivery performance.

We also see that site reliability engineerings (SREs) impact on organizational performance is non-linear; reliability engineering practices often do not result in additional reliability or organizational performance until a certain maturity is reached. Its important for teams to know this and approach their SRE practice as an investment. It will likely not be sparkly ponies and unicorns initially as you build the reliability muscle but, as you advance, high performance and success are likely.

Public cloud use is up a whopping 36% over 2021, whereas companies reporting no cloud usage at all are down by 50%. The use of hybrid cloud is up by 25%. Unsurprisingly, the use of cloud computing was associated with higher organizational performance. In past years we saw that it wasnt using cloud per se that led to organizational performance, rather it was the achievement of the five essential characteristics of cloud computingon-demand self-service, broad network access, resource pooling, rapid elasticity and measured service. This year, we saw that cloud computing enabled things like reliability, continuous delivery and improved supply chain security which drive organizational success.

Over 50% of folks who took our survey reported that they leveraged multiple cloud providers. We asked respondents what benefits they realized from using multiple cloud providers. Here are the top three:

Given the fact that reliability seemed to be the key to being a successful software delivery shop as well as a successful organization, it is not surprising to see availability listed by almost 63% of respondents as a benefit derived from using multiple clouds.

Our research continues to progress and we continue to dig deeper and deeper into the capabilities and practices that impact your business. We see broad adoption on the topics of security and reliability which are both heavily anchored in culture. Good culture leads to success. Period. There is no magic culture button and it takes work, but it is very achievable. Start by defining organization-wide or line-of-business-wide goals and then just start continuously improving. Dont worry about creating a three-year plan for improvement; create a one-month plan and just get to work instead. At the end of that month, evaluate your learnings, refine your focus and get back to work. With a commitment to hard work and continuous improvement, your investments should start paying off and, as an added bonus, youll have a better culture.

We hope you have enjoyed these juicy findings as much as we have and we encourage you to read the entire 2022 State of DevOps Report.

Also, please join us at dora.community to continue the discussion about these findings and to share and discuss your experiences on your journey toward excellent software delivery and operations.

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Driving Organizational Success With the 2022 State of DevOps Report - DevOps.com

Virtualization supports cloud computing and enables differentiation between digital assets. Here are some of the benefits and use cases.

Cloud computing continues to become a viable option for businesses and organizations around the world. This ever-growing system of digital management allows companies the freedom to scale operations or efficiently manage clients, data and services. But cloud computing comes in many forms and can be complicated for businesses to maintain long-term. Fortunately, utilizing virtualization can be a great solution.

Virtualization, in fact, is already present in various aspects of the cloud model. From security to ease of access, virtualization is a way of organizing cloud systems and successfully conducting business. According to Introduction to Virtualization in Cloud Computing, a recently published chapter in Machine Learning and Optimization Models for Optimization in Cloud, the effects of virtualization on cloud systems are invaluable.

Understanding virtualization in cloud computing can help businesses maintain a digital presence without fear of deficiency. With new tools and the expanding network of digital computing, virtualization has become easier to grasp and implement than ever before.

Virtualization has been defined in a dozen different ways. At its most basic, it can be considered the creation of virtual hardware and software services that can be used and flexibly managed by organizations as needed. This definition sheds light on the current existence of virtualization in cloud models. That said, virtualization is an integral part of cloud technologies.

Indeed, it is not something that can be eliminated from the cloud process. Rather, virtualization is what makes cloud and multicloud technologies viable for numerous businesses.

The most important part of a virtual model is a bit of software called a hypervisor. Hypervisors can be imagined as a buffer between hardware and clients using operating systems or services to run their businesses. This allows one piece of hardware to form multiple virtual computers for guest use.

SEE: Megaport Virtual Edge vs Equinix Network Edge: Compare top edge computing platforms (TechRepublic)

Virtualization contributes to increased security for organizations operating in a digital space. Instead of relying on hardware to provide security, virtual systems store information collectively and stop data from being shared between applications. Virtualization also allows technicians to grant access to only specific aspects of a network and lets professionals exercise greater control over systems.

In truth, the most powerful security feature of virtualization is related to its ability to separate all digital computers on a network, meaning that data is not transferred from system to system. This helps keep cloud computing secure and maintains a safe atmosphere for businesses that handle private information or worry about data leaks.

Without hardware to consider, virtualization paves the way for new methods of conducting business digitally. Perhaps the most obvious benefit of flexible servers is the cost. Companies are no longer forced to pay for hardware when they adopt virtual solutions. In addition, virtualization allows for the differentiation of operating systems and networks. This is called desktop virtualization.

Indeed, there are multiple different types of virtualization that exist within the cloud space, including desktop, network, server, application and more. These different forms of virtual computing contribute to flexibility as well by making it possible for businesses to specialize in the technology that they require most. While this process can be confusing, it certainly has long-term benefits that grant more control over operations and digital commerce.

Considering the link between cloud computing and virtualization, it should come as no surprise that the same strengths related to productivity can also be applied to virtual technologies. Cloud systems, while possible without virtualization, would be much more complex and expensive. Coupled with virtual computing, the two processes ease the stress of businesses. Virtualization, for example, increases the efficiency of hardware by facilitating different operations, systems, desktops and storage functions at the same time.

Virtualization also allows for multiple operating systems to run at the same time. And, should there ever be a maintenance issue, restructuring a virtual system is much simpler and less expensive than addressing hardware faults. All of these processes and more come together to form a network that aids organizations by creating a smoother and more reliable cloud system.

Virtualization, and cloud computing itself, is projected to grow in the coming years. According to Allied Market Research, the virtualization security market alone is expected to jump from $1.6 billion to $6.2 billion in 2030. This is because virtualization has become increasingly important in businesses around the worldand not always the most obvious ones.

Virtualization is an integral part of the cloud streaming process. It allows organizations to separate content between users and platforms securely. The technology is also used to store information for clients and companies that handle sensitive content. This could mean medical records, financial information or any other private data. In fact, virtualization is expected to benefit globally as more organizations begin to move toward a digital environment.

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Advantages of virtualization in cloud computing - TechRepublic

The bear market of 2022 has been brutal to software stocks, and some of them are rightfully being punished. Fast growth is good, but profitability matters. And many upstart cloud software companies have been found to be deficient in this department.

That's not the case for Dynatrace (DT 3.10%). The company is dedicated to growing profitably, and the financial results show it. Nevertheless, headed into the fourth quarter of 2022, shares sold off some 45% this year as the stock gets hammered along with the rest of the tech market. Here's why Dynatrace is starting to look like a good deal.

One reason the market is being clobbered relates to fears of a recession. As economic downturn risk increases, many organizations tighten up their budgets. But the top brass at many cloud companies say they're still growing because "digital transformation" remains a top priority. That makes sense, as investing in digital processes helps a business get more efficient and saves resources in the long run.

That's the story Dynatrace's top team preached this year as well. As giant corporations (Dynatrace's focus) migrate more of their operations to the cloud, they need a new set of tools to ensure these new IT capabilities and cloud-based apps operate properly. That's where cloud observability comes in.

Dynatrace's platform covers everything from application performance monitoring to security to tech infrastructure monitoring. And unlike a lot of legacy software, this toolset doesn't just inform an IT department if something is amiss. It also suggests and helps automate a fix. Data volume and complexity are booming as cloud adoption ramps up, so this kind of automation is mission critical for mega-corporations.

But what if cloud industry growth slows down? At a recent tech conference, CEO Rick McConnell pointed out that the cloud hyper scalers Amazon AWS, Microsoft Azure, and Alphabet's Google Cloud collectively hauled in about $160 billion in revenue in Q2 2022, growing at a 36% year-over-year pace. Even if that rate of increase slows a bit, the cloud universe is doing just fine.

And since Dynatrace generally follows the route of cloud industry expansion, it's doing just fine as well. Its revenue increased 34% year-over-year in its last quarter, even as many of its big customers started reducing spending as recession worries mounted.

For its 2023 fiscal year (the 12-month period that will end in March 2023), Dynatrace expects revenue to be up at least 21% (or up at least 26% when excluding foreign currency exchange rates) to about $1.13 billion. Along the way, free cash flow profit margin should be about 28%, a very healthy rate for a growth company.

Granted, this is a slowdown from the recent past. Economic uncertainty and the U.S. dollar's historic run-up are weighing on revenue and profits. McConnell and company also decided earlier this year to invest a little of the company's cash into expanding its salesforce. Over the next year or two, management sees those free cash flow margins edging back up toward 30% as that investment is digested.

And thanks to its steady generation of fresh cash, Dynatrace's balance sheet has also rapidly improved since its IPO in 2019. Once saddled with liabilities, this company is now cash- and short-term-investment positive net of debt.

Data by YCharts.

This debt payoff hasn't hindered Dynatrace's development of more tools, though. McConnell has said the infrastructure monitoring module is pulling in about $100 million a year in sales now, but growing at a much faster rate than revenue overall. The more recently released app security module is well on its way to reaching $100 million in annualized revenue. And a new tool that has been in the works for a few years now, data log management (Splunk's primary software capability), is almost ready to be unveiled. Based on Dynatrace's conversations with customers, log management is expected to also very quickly ramp up to $100 million a year in sales.

After getting dragged down by the market overall, Dynatrace stock now trades for 32 times enterprise value to free cash flow. It's a rare software company that is reporting fast growth and robust free cash flow generation. I think it could be time to nibble here if you are looking for quality cloud computing stocks to hold for the next few years.

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Nicholas Rossolillo and his clients have positions in Alphabet (C shares), Amazon, and Dynatrace, Inc. The Motley Fool has positions in and recommends Alphabet (A shares), Alphabet (C shares), Amazon, Microsoft, and Splunk. The Motley Fool has a disclosure policy.

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This Top Cloud Computing Stock Is Starting to Look Like a Great Deal - The Motley Fool

The benefits of hybrid cloud computing are compelling, and many IT leaders are opting for hybrid offerings as part of their digital transformation journeys. A hybrid cloud allows organizations to keep some data within an on-premises infrastructure while outsourcing other computing needs to public cloud services. The benefits of such a model include cost optimization, scalability, and flexibility in meeting data sovereignty requirements. The overwhelming downside is the complexity of managing such a model.

In a report titled IBM Transformation Index: State of the Cloud, released this week, survey findings indicated that IT and business professionals understandthe benefits of hybrid cloud usage and believethat a multicloud approach isnecessary to modernizing cloud technology. However, survey respondents pointed to security concerns, lack of skills, and compliance issues as limiting factors that impede cloud goals. According to IBM's study, more than half of the respondents were concerned with security, while 53% cited difficulties with compliance. Perhaps most notably, nearly 70% said they believed their teams lacked the skills needed to successfully manage cloud environments.

Related: Will Hybrid Cloud Save You Money? Predict Your Hybrid Cloud Costs

With the global increase in industry regulations comes complexities with compliance. Over half of the professionals polled said that ensuring compliance in the cloud is already too difficult to manage. Given the hybrid models siloed approach to managing workloads over a more holistic approach to managing multicloud environments, there is greater risk of Frankenclouds, or a cloud network that is disconnected and difficult to navigate, thus hard to secure against data breaches and security blindspots.

Despite efforts to increase data security, and 6 in 10 respondents reporting that they use security tools (including but not limited to VPNs, multifactor authentication, and Confidential Computing), 32% of respondents said that security threats were the top barrier to integrated workloads across cloud environments.

Yet with 77% of the respondentsalready using hybrid clouds, the question is not if enterprises will adopt hybrid models, but how they will face the challenges that come along with integration. IBM Cloud CTO Hillery Hunter said she sees a possible solution in industry-specific clouds. [Industry-specific clouds that] take a data privacy and risk-based approach are key to a successful hybrid cloud strategy for enterprises, Hunter said. IBM Cloud for Financial Services, for example, includes built-in security and compliance controls designed specifically for this heavily regulated industry.

In response to survey findings, IBM plans to release tools for enterprisesto track their transformational journey while assessing their progress against other companies. The tools will focus on efficiently diagnosing obstacles and offering benchmarks for success, IBM said.

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IBM Cloud: Hybrid Clouds Offer Innovation, but Not Without Challenges - ITPro Today

LAS VEGAS #MWC22 Mike Murphy has a unique view into the future of 5G.

Murphy has been developing wireless technologies for almost four decades, first at Nortel, then at Nokia andnow at Ericsson. Today, hes the North American CTO for Ericsson, the only network equipment supplier currently providing midband 5G gear to all of the big US operators: AT&T, Verizon and T-Mobile.

And here at the MWC trade show, Murphy said theres one new technological quandary thats soaking up his attention: How 5G providers will work with hyperscale cloud providers. He said the problem is difficult enough and important enough that he has assigned four Ericsson technicians to work on it full time.

Thats all they do, he said.

Broadly, Murphy said hes trying to figure out how the cloud computing market and the telecom market might work together. How do you converge the two worlds? he asked.

Its a question that some of the worlds biggest technology companies from Dell to Amazon to AT&T to Google to Ericsson to Qualcomm are struggling with.

That time the hyperscalers invaded MWC

We are at an inflection point in the industry where the cloud is being adopted more and more by the telecom segment, said Ishwar Parulkar, the chief technologist for telecom and edge cloud at Amazon Web Services (AWS),here at the MWC show.

AWS, Microsoft (via its Azure cloud) and Google Cloud have all made their intentions plain: They want to bring the telecom industry into the cloud.

To do so, each companycreated telecom-specific business units, staffed bya large number of well-known telecom veterans, and have beensending phalanxes of executives to the telecom industrys biggest trade shows.

Thats not really a surprise, of course. A wide range of industries from media to government to financial services have already put much of their core digital infrastructure into the cloud. Why shouldnt telecom?

And to a degree, telecom network operators have already done so. Many have moved significant portions of their systems from customer service programs to IT operations into the cloud. The next obvious step is to put theirnewly virtualized, software-defined network functionsinto the cloud too.

After all, the cloud is endlessly scalable and instantly available.

At least, thats the argument.

Cloud native, cloud wary

No hyperscaler supports five nines, Ericssons Murphy said, citing the 99.999% network-uptime goal that most telecom providers share.

Murphy explained that most of todays cloud computing providers cant provide the kind of orchestration, data management and security services that network operators need for their core network services.

To read the complete article, visit Light Reading.

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Debating the role of hyperscale cloud providers in 5G - Urgent Comms - Urgent Communications