News, Software

Global public cloud spending set to skyrocket

Worldwide spending on public cloud services and infrastructure is forecast to reach $160 billion in 2018, representing an increase of 23.2 percent over 2017.

According to IDC findings, the market is forecast to achieve a five-year growth rate of 21.9 percent with public cloud services spending totalling $277 billion in 2021, despite a predicted slowdown in investments.

From a vertical perspective, the industries that are forecast to spend the most on public cloud services in 2018 are discrete manufacturing ($19.7 billion), professional services ($18.1 billion), and banking ($16.7 billion).

The process manufacturing and retail industries are also expected to spend more than $10 billion each on public cloud services in 2018. These five industries will remain at the top in 2021 due to their continued investment in public cloud solutions.

In addition, the industries that will see the fastest spending growth over the five-year forecast period are professional services (24.4 percent), telecommunications (23.3 percent) and banking (23 percent).

“The industries that are spending the most – discrete manufacturing, professional services, and banking – are the ones that have come to recognise the tremendous benefits that can be gained from public cloud services,” IDC programme director Eileen Smith said.

“Organisations within these industries are leveraging public cloud services to quickly develop and launch 3rd Platform solutions, such as Big Data and analytics and the Internet of Things (IoT), that will enhance and optimise the customer’s journey and lower operational costs.”

Specific to technology, software-as-a-service (SaaS) will be the largest cloud computing category, capturing nearly two thirds of all public cloud spending in 2018.

SaaS spending, which is comprised of applications and system infrastructure software (SIS), will be dominated by applications purchases, which will make up more than half of all public cloud services spending through 2019.

Enterprise resource management (ERM) applications and customer relationship management (CRM) applications will see the most spending in 2018, followed by collaborative applications and content applications.

Delving deeper, infrastructure-as-a-service (IaaS) will be the second largest category of public cloud spending in 2018, followed by platform-as-a-service (PaaS).

“IaaS spending will be fairly balanced throughout the forecast with server spending trending slightly ahead of storage spending,” Smith added.

“PaaS spending will be led by data management software, which will see the fastest spending growth (38.1 percent CAGR) over the forecast period.”

Meanwhile, application platforms, integration and orchestration middleware, and data access, analysis and delivery applications will also see healthy spending levels in 2018 and beyond.

“Digital transformation is driving multi-cloud and hybrid environments for enterprises to create a more agile and cost-effective IT environment in Asia Pacific,” IDC research manager Ashutosh Bisht added.

“Even heavily regulated industries like banking and finance are using SaaS for non-core functionality, platform as-a-service (PaaS) for app development and testing, and IaaS for workload trial runs and testing for their new service offerings.

“Drivers of IaaS growth in the region include the increasing demand for more rapid processing infrastructure, as well as better data backup and disaster recovery.”

Previous ArticleNext Article

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.


The free newsletter covering the top industry headlines