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Public cloud spending to reach $122.5B in 2017

Tue 21 Feb 2017

Public cloud spending

The International Data Corporation (IDC) has published an update to its global cloud spending guide, with new estimates showing that spending on public cloud services and infrastructure will reach $122.5 billion this year.

The new estimate represents an increase of 24.4% over 2016 numbers.

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.

The dominant type of cloud computing will remain Software as a Service (SaaS), with two-thirds of the 2017 market declining to 60% by 2020. SaaS spending will continue to be focused on system infrastructure software (SIS), with applications purchases comprising more than half of the projected public cloud spending from 2017-2020.

However, the study notes that spending on Infrastructure and Platform as a Service models will grow at much faster rates over the same time, with IaaS growth rates projected at 30.1%, and PaaS at 32.2% through 2020.

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.

The top industries in terms of growth rate are professional services, retail, media, and telecommunications. Manufacturing, banking, and professional services are expected to lead in dollars, however, with a combined total spending of $41.2 billion for 2017 alone. This represents one-third of the expected global total for public cloud spending for the year.

The greatest amounts will be spent by very large businesses, with over 1,000 employees, but it is companies with 500-999 employees who will grow spending at the fastest rate.

The United States will be the largest market, with over 60% of total global revenues, followed by Western Europe and Asia/Pacific regions. The U.S., though, will see the slowest growth rate of the regions studied, with projected year-to-year growth of 19.9%.

Senior research manager, Serena Da Rold said, “In Western Europe, the public cloud market will grow at a healthy 23.2%.” She noted that while the U.S. was faster to adopt cloud technologies, over the next few years as the market matures, cloud providers will target and capture the untapped segments.


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