Trends poised to influence Cloud computing in 2025

As we look ahead to 2025, a new wave of emerging technologies will develop and mature. Cloud computing is expected to not just evolve but to transform entirely as laws and technology develop. The businesses that welcome this innovation boom will be best placed to seize on the potential of digital transformation. After all, in a world where AI is one of the most talked about game-changers, having AI capabilities is no differentiator but how companies use it to gain competitive advantage absolutely can be.

In light of this, SoftwareOne's Chief Technology Officer for Cloud Services, Alex Galbraith, examines four trends that will reshape the Cloud market in the upcoming year and beyond.

1) Sustainability as a focus

The demand for data centre power is set to grow 160% by 2030 as the use of AI, alongside Cloud computing capabilities, increases and as a result, emissions are set to surge. Despite attempts by technology companies to drive down emissions, it is estimated that rising demand will deliver emissions equivalent to 2.5 billion metric tonnes of carbon dioxide by 2030, according to recent research. Looking ahead, Cloud providers will have a duty to offer more eco-friendly solutions and transparent carbon accounting to their customers, like renewable-powered data centres and energy-efficient infrastructure, for example, to help them manage their emissions.

With legislation, including the EU’s Energy Efficiency Directive, requiring data centre operators to report energy usage, data centres will need robust data analysis capabilities to ensure they are able to comply with new disclosure demands. This also includes data optimisation to identify inefficiencies and opportunities to reduce consumption. 

FinOps, the operational framework that helps organisations maximise business value through Cloud technology, will be a key tool in achieving sustainability goals. FinOps helps to optimise costs and drive more efficient Cloud use, reducing the energy required to run Cloud resources. Every dollar saved on Cloud spend leads to a reduction in carbon footprint, so cost-efficiency becomes synonymous with environmental responsibility.

2) A close eye on AI

Compliance around the use and deployment of AI will be under the microscope in 2025. From February, rules that prohibit certain uses of AI systems considered to pose a certain level of risk will take effect under the EU’s AI Act. It will see bans on practices such as live facial recognition and emotional recognition technology come into force. The Act’s full implementation, however, follows a staggered approach until 2027, meaning businesses deploying or providing AI systems will have to stay alert to all movements in the new regulatory regime. 

Ultimately, the success of companies’ generative AI strategies in the Cloud will be dictated by requirements for a balanced approach to risk as outlined in the legislation. In a competitive business environment, the fact that companies use AI will become less of a differentiator – it all depends on how AI is used to improve business processes and provide meaningful value to the business and their customers. One of the AI Act’s pillars is to promote AI literacy. To achieve this, it is vital for businesses to be proactive and establish clear governance structures, and develop their AI vision and strategy today, to help prepare the business for the cultural, process and technical changes that will happen tomorrow.

3) The potential of 5G and Edge computing

The combination of Edge computing – the practice of processing data near the edge of the network where it is generated – and 5G will have a significant impact on the Cloud landscape. The coalescing of these two technologies will enable real-time, low-latency data processing, minimising the need to send excess data to centralised Cloud platforms and reducing bandwidth and other associated costs, while improving the scalability of their applications.

Currently, we are seeing a massive growth in IoT and low-latency apps. With this growth, we expect to see a demand for more localised computing so that IoT devices can make quick decisions instantly and locally. This has wide ranging applications in many fields, for example healthcare (wearables administering medicine to patients without user input) and automotive (help self-driving cars process data from their sensors in real time, allowing them to respond faster to their surroundings).    

Looking ahead, we can expect the combination of Edge computing and 5G will bring greater speed to operations as well as better scalability, and accessibility for emerging technologies.

4) Quantum computing: change at lightning speed

Quantum computing is one of the biggest trends set to disrupt the Cloud services industry in 2025.  Offering lightning-fast computation speed and efficiencies in security and optimisation, we can expect to see enterprises start feeling the benefits. Quantum computing will grow exponentially in the years ahead and is projected to grow from $1.1 billion in 2024 to $12.6B in 2032. Investment is ramping up with all three of the big hyperscalers already creating and investing in quantum resources today and major Cloud providers beginning to experiment with quantum-as-a-service models. 

Although it’s early days, quantum computing is starting to shape how organisations think about research, modelling, security and data. Poised to bring new levels of speed to enterprises, quantum will enhance data analysis, fuel productivity and mean entirely new products and services that have been considered only science fiction, using current technology.

Industries such as pharma that require complex computation for drug discovery, cryptography, and financial modelling will be the first to take advantage of quantum computing, looking to quantum as the next ‘silver bullet’ for transforming their industries. To make the transformation possible, the Cloud provides the ideal mechanism for accessing quantum due to its accessibility and scalability. Naturally, it is those who have already moved to Cloud models will be the ones quick to take advantage of quantum computing as it becomes more accessible through Cloud platforms.