White Papers Leveraging the cloud for improved performance | Page 2

INTRODUCTION
While delivery of applications and services in the cloud has been a part and parcel of business
for over a decade, adoption of cloud-delivered CTRM applications (not to be confused with host-
ed solutions), has taken time to develop. However, the collapse in commodity prices and profit-
ability over the last several years has incentivized firms in the commodities space to rethink their
approach to acquiring and managing IT solutions.
With increasing market experience with these products,
market activity over the last few years indicates that
adoption of cloud CTRM solutions is increasing rapidly
as the lower cost of entry, benefits of a pay as you go
approach, and realization that the cloud can actually be
more secure than on-premises, have all aided its growth.
Changes in the overall structure of the industry, includ-
ing divestitures, downsizing of trading staff, and more
niche-focused start-ups have served to increase the
number of smaller companies and non-traditional play-
ers in the market; while increasingly rigorous regula-
tions have forced these same businesses (that might
have otherwise relied on spreadsheets to manage their
business) to adopt commercial systems in order to more
robustly address regulatory and stakeholder mandates.
Given these influences, it’s perhaps not surprising that
Commodity Technology Advisory (ComTech) research
indicates that cloud-delivered CTRM solutions now out-
sell (on a per unit basis) traditionally deployed, on-prem-
ises solutions. It’s interesting to note however, that cloud
adoption has not been consistent across all markets, in-
dustries, and commodities.
Early adopters of CTRM in the cloud tended to be very
small firms, usually trading a single commodity such as
oil, and were generally located in Europe, Asia, and Af-
rica. It’s only been within the last couple of years that
other markets, including the US, and other commodity
industries, like agricentric businesses, have turned to
cloud-based offerings in significant numbers to manage
their business and trading operations.
In light of this rapid shift in the market, ComTech now
forecasts that spending for cloud deployed CTRM will
grow by as much as 15-20% per year over the next 5
years, far outpacing any spending increases for tradi-
tionally installed solutions.