Cloud Growth Areas to Watch According to Analysts
- Author: Arturo Norris Feb 24, 2017,
Feb 24, 2017, 8:24
The study also shows that public cloud spending will continue to grow at a rate of 21.5% every year from 2015 to 2020, resulting in a forecast expenditure of $203.4 billion per year by 2020.
IDC', by comparison, said global spending on public cloud services and infrastructure would reach $122.5bn by the end of this year with seven out of eight primary geographic regions to record CAGRs of more than 20% in the next five years.
Figuring in all the various parts of the worldwide public cloud market is hard, which is likely why the numbers are so different.
20 industries were studied to create the five-year forecast, with 18 of the 20 expected to have over 20% in year-to-year growth in public cloud spending. Software-as-a-service (SaaS) is expected to grow 20.1 per cent to reach $46.3 billion. Some of the IaaS demand will be driven by increased use of compute-intensive workloads like artificial intelligence and Internet of Things.
The United States will be the largest market, with over 60% of total global revenues, followed by Western Europe and Asia/Pacific regions.
"While some organizations are still figuring out where cloud actually fits in their overall IT strategy, an effort to cost optimize and bring forth the path to transformation holds strong promise and results for IT outsourcing (ITO) buyers". But the segment is vastly outperforming other parts of the industry, with a growth rate that's nearly seven times faster than that of overall IT spending. "Combined, these three industries will account for one-third of worldwide public cloud services spending, or $41.2 billion". And while SaaS's dominance might fade over time, it will still account for 60 percent of cloud spend by 2020, IDC said. "Gartner predicts that through 2020, cloud adoption strategies will influence more than 50% of IT outsourcing deals", he added.
The industries that will see the fastest growth in public cloud spending over the five-year forecast period are professional services (23.9 per cent CAGR), retail (22.8 per cent CAGR), media (22.5 per cent CAGR), and telecommunications (22.1 per cent CAGR). She noted that while the US was faster to adopt cloud technologies, over the next few years as the market matures, cloud providers will target and capture the untapped segments.
IDC predicts that nearly half of public cloud spending is forecast to come from "very large business" with more than 1,000 employees.
Meanwhile, large businesses (500 to 999 workers) will experience the highest CAGR of 23.2 percent, IDC said.
Forecasts from Gartner are highlighting IaaS as the main area to benefit from a general upswing in customer spending on public cloud services. This is mostly related to human capital management and customer relationship management, as well as the increase in buying of financial applications.