Global public cloud services revenue surges past $500 billion

Global public cloud services market revenue has reached £422.4 billion ($545.8 billion) last year. This is an increase of 22.9% over 2021, according to an IDC report.

More than 41% of the total market share was dominated by Microsoft, Amazon Web Services, Salesforce, Google, and Oracle. This grew by 27.3% year-over-year.

Microsoft led the pack offerings encompassing all four deployment categories. The company took a 16.8% share in overall public cloud services market, closely followed by Amazon Web Services with 13.5%.

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Overall, the global public cloud services market grew 22.9% year-over-year in 2022. Meanwhile, revenue for foundational cloud services that support digital-first strategies saw revenue growth of 28.8%.

Software as a Service (SaaS) applications continued to be the largest source of global public cloud services revenue, with more than 45% of the total in 2o22.

“SaaS remain the largest segment of the more than £423.6 billion ($547 billion) cloud software market forecast by the end of 2023,” said Frank Della Rosa, Research Vice President for SaaS, Business Platforms, and Industry Cloud at IDC.

Infrastructure as a Service (IaaS) was the second largest revenue category claiming 21.2 % of the total, followed by Platform as a Service (PaaS) at 17%.

IDC said it would be easy to assume that CIOs will focus on constraining new expenditures and optimising the use of existing cloud assets due to the economic challenges of the past year. However, they stress that this would be an incorrect conclusion.

“The assessment and use of AI, triggered by generative AI, is starting to dominate the planning and long term investment agendas of businesses and cloud providers will play a significant role in the evaluation and adoption of AI enablement services,” said Rick Villars, Group Vice President of Worldwide Research at IDC.

IDC suggested enterprises are becoming increasingly reliant on cloud innovation platforms built around widely-deployed compute services, data and AI services, and app framework services.

“Those that have started to adopt AI are finding themselves well positioned to evaluate further adoption of generative AI capabilities in an intelligent app-strategy,” said Lara Greden, Research Firector for Platform as a Service at IDC.

Spending on foundational cloud services like IaaS and PaaS is expected to grow at a higher rate than the overall cloud market, as enterprises seek cloud to accelerate their digital transformation initiatives.

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