Skip to main content

Cloud IaaS Revenue will Reach $150.7 Billion in 2023

Demand for cloud computing Infrastructure-as-a-Service (IaaS) is expected to drive the current $45.6 billion market toward $150.7 billion by 2023 -- that's a compound annual growth rate of 27 percent, according to the latest worldwide market study by Frost & Sullivan.

Enterprises are using cloud services for strategic benefits such as supporting digital transformation efforts rather than for tactical ones, like reducing IT infrastructure costs and the hardware or software maintenance burden.

This market shift has changed the way enterprises choose and manage their IT infrastructure, and led them to deploy applications across multiple infrastructures, from on-premises private cloud to public cloud (multi- and single-tenant), resulting in higher demand for IaaS offerings.

Hybrid Multi-Cloud Market Development

"As the mix of deployment models and best-of-breed cloud IaaS vendors becomes increasingly diverse, single-tenant IaaS will gain revenue share over multi-tenant services," said Maiara Munhoz, senior industry analyst at Frost & Sullivan.

Meanwhile, the emergence of cloud brokerage and cloud management platforms is boosting the trend of hybrid and multi-cloud deployment strategies, making managed cloud services providers key in supporting enterprises and their CIO or CTO requirements.

Frost & Sullivan analysts believe that managed service providers (MSPs) will support their customers with workload assessment and placement, workload migration, and hybrid cloud integration.

The North America region continues to be the most mature cloud IaaS market globally, followed by EMEA, but they are expected to gradually make room for the APAC and LATAM regions.

Some countries in APAC, such as Japan and Australia, are more mature, while India, China, Singapore, South Korea, and Hong Kong are fast-growing markets.

Outlook for Cloud IaaS Applications Growth

Going forward, it will be essential for vendors of cloud computing IaaS to invest in integrated services, on-premises and in the public cloud. For further growth opportunities, vendors should:

  • Offer more advanced services in the cloud -- such as containers and serverless architecture -- and tools for enterprises to manage, analyze, and act on their data.
  • Support hybrid deployment models, as enterprises realize that a single cloud or deployment model will not address all their application requirements.
  • Partner with MSPs to deliver training, programs and features to support them.
  • Invest in educating clients on cloud computing technology, as enterprises still need guidance on how to use cloud services to meet goals for business innovation and digital transformation.

Popular posts from this blog

The AI Application Integration Challenge

Artificial intelligence (AI) has rapidly become the defining force in business technology development, but integrating AI into applications remains a formidable challenge. According to a recent Gartner survey, 77 percent of engineering leaders identify AI integration in apps as a major hurdle for their organizations. As demand for AI-powered solutions accelerates across every industry, understanding the tools, the barriers, and the opportunities is essential for business and technology leaders seeking to evolve. The Gartner survey highlights a key trend: while AI’s potential is widely recognized, the path to useful integration is anything but straightforward. IT leaders cite complexities in embedding AI models into existing software, managing data pipelines, ensuring security, and maintaining compliance as persistent obstacles. These challenges are compounded by a shortage of skilled AI engineers and the rapid evolution of AI technologies, which can outpace organizational readiness and...