Public cloud spend to double in next five years
Public cloud spend is set to increase from US$229 billion in 2019 to nearly US$500 billion in 2023, according to forecasts by the IDC this week— representing a two-fold hike in five years and a CAGR of 22.3 percent.
The US will remain the largest public cloud services market, accounting for more than half the worldwide total through 2023, while professional services, discrete manufacturing and banking will account for more than one-third of all public cloud services.
The rise in spending comes as enterprises continue to shift from traditional application software to software-as-a-service (SaaS), such as Customer Relationship Management (CRM) and Enterprise Resource Management (ERM) software.
SaaS represents the largest category of cloud computing, taking more than half of public cloud spend.
Meanwhile— comprising servers and storage devices— infrastructure as a service (IaaS) is the fastest-growing segment of public cloud spend (32 percent CAGR), with adoption particularly strong among data and compute-intensive services, such as professional services. BIG DATA
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Spendings on Platform as a Service (PaaS); consisting of data management software, application platforms, and integration and orchestration middleware, will follow closely with a CAGR of 29.9 percent.
With the US set to continue dominating the market, Western Europe will claim a fifth of global spend (20 percent), while China will experience the fastest growth in public cloud spending over the five-year period with a near 50 percent CAGR.
Separate research by Gartner earlier in the year churned up similar figures and trends.
The firm’s Research VP, Sid Nag, said: “[…] we know of no vendor or service provider today whose business model offerings and revenue growth are not influenced by the increasing adoption of cloud-first strategies in organizations.”
The research went on to predict that the market size and growth of the cloud services industry would nearly triple the growth of overall IT services through 2022, with more than a third of organizations seeing cloud investments as a ‘top three’ priority.
By the end of 2019, the same report said that more than 30 percent of technology providers’ new software investments will shift from ‘cloud-first’ to ‘cloud-only’.