Skip to main content

Public Cloud Revenue will Reach $186.4 Billion in 2018

Around the globe, CIOs and CTOs continue to transition to a hybrid multi-cloud service delivery model, supported by on- and off-premises IT infrastructure. Meanwhile, the worldwide public cloud services market is projected to grow 21.4 percent in 2018 to reach $186.4 billion -- that's up from $153.5 billion in 2017.

The fastest-growing segment of the market is cloud Infrastructure as a Service (IaaS), which is forecast to grow 35.9 percent in 2018 to reach $40.8 billion, according to the latest worldwide market study by Gartner.

Public Cloud Market Development

Moreover, Gartner expects the top ten cloud service providers to account for nearly 70 percent of the IaaS market by 2021 -- that's up from 50 percent in 2016.

"The increasing dominance of the hyperscale IaaS providers creates both enormous opportunities and challenges for end-users and other market participants," said Sid Nag, research director at Gartner.

According to the Gartner assessment, while public cloud enables efficiencies and cost benefits, organizations need to be cautious about IaaS providers potentially gaining unchecked influence over CIO and CTO budgets.

In response to multi-cloud adoption trends, organizations will increasingly demand a simpler way to move workloads, applications and data across cloud providers' IaaS offerings without penalties. And, cloud migration and management tools will be instrumental in easing the transition to hybrid IT scenarios.

Software as a service (SaaS) remains the largest segment of the cloud market, with revenue expected to grow 22.2 percent to reach $73.6 billion in 2018. Gartner expects SaaS to reach 45 percent of total application software spending by 2021.

"In many areas, SaaS has become the preferred delivery model," said Mr. Nag. "Now SaaS users are increasingly demanding more purpose-built offerings engineered to deliver specific business outcomes."

Within the platform as a service (PaaS) category, the fastest-growing segment is database platform as a service (dbPaaS), expected to reach almost $10 billion by 2021. Hyperscale cloud providers are increasing the range of services they offer to include dbPaaS.

"Although these large vendors have different strengths, and customers generally feel comfortable that they will be able to meet their current and future needs, other dbPaaS offerings may be good choices for organizations looking to avoid lock-in," said Mr. Nag.

Outlook for Public Cloud Market Growth

Although public cloud revenue is growing more than initially forecast, Gartner expects growth rates to stabilize from 2018 onward, reflecting the maturity that public cloud services will gain within a wider IT spending mix that includes private cloud and traditional on-premises IT infrastructure.

Note, this forecast excludes cloud advertising, which was removed from Gartner's public cloud service forecast segments in 2017.

Popular posts from this blog

Open Banking Usage to Grow by 470 Percent

The Open Banking business model has been advantageous for Third-Party Providers (TPPs), helping them to extend their offerings into other areas of financial services with new capabilities. Open Banking is also advantageous for traditional banking institutions, despite the perceived loss of custodianship over their data, by providing greater accessibility to more bank services. Furthermore, Open Banking can help serve Mobile Internet providers that are able to leverage it to create tailored services according to customers’ preferences and/or economic limitations. Open Banking Market Development Since traditional banking services are made more convenient by TPPs via greater data access, customers can proactively manage their finances and shape the development of new financial offerings. This is particularly noticeable in the realm of Digital Payments, where retail merchants and customers transact through eCommerce, which has the greatest number of use cases for Open Banking. These includ

Digital Talent Demand Exceeds Supply in Asia-Pac

Even the savviest CEO's desire for a digital transformation advantage has to face the global market reality -- there simply isn't enough skilled and experienced talent available to meet demand. According to the latest market study by IDC, around 60-80 percent of Asia-Pacific (AP) organizations find it "difficult" or "extremely difficult" to fill many IT roles -- including cybersecurity, software development, and data insight professionals. Major consequences of the skills shortage are increased workload on remaining digital business and IT employees, increased security risks, and loss of "hard-to-replace" critical transformation knowledge. Digital Business Talent Market Development Although big tech companies' layoffs are making headlines, they are not representative of the overall global marketplace. Ongoing difficulty to fill key practitioner vacancies is still among the top issues faced by leaders across industries. "Skills are difficul

Mobile Device Market Still Awaiting Recovery

The mobile devices market has experienced three years of unpredictable demand. The global pandemic, geopolitical pressures, supply chain issues, and macroeconomic headwinds have hindered the sector's consistent growth potential. This extremely challenging environment has dramatically affected both demand and supply chains. It has led to subsequent inflationary pressures, leading to a worsening global cost of living crisis suppressing growth and confidence in the sector. In tandem, mobile device industry stakeholders have become more cautious triggering market uncertainties. Mobile Device Market Development Operating under such a backdrop, the development of mobile device ecosystems and vendor landscapes have been impacted severely. Many of these market pressures persisted throughout 2022 and now into 2023, borne chiefly by the smartphone market. According to the latest worldwide market study by ABI Research, worldwide smartphone shipments in 2022 declined 9.6 percent Year-over-Year