Enterprise Spending on Public Cloud Services Expected to Top $195 Billion by 2020

By: Joe Hewitson| - Leave a comment

Cloud technology is firing on all cylinders of late, especially in the enterprise market. Expected to rise nearly 19 percent this year, enterprise investment in cloud infrastructure could surpass a lofty $38 billion by the end of 2016. As impressive as that statistic is, InformationWeek discusses a recently released IDC forecast on public cloud services, and things look like they’re just getting started.

Led by software-as-a-service (SaaS), IDC expects worldwide spending on the cloud service market to double, reaching a staggering $195 billion by 2020. Over the same period, public cloud services’ compound annual growth rate (CAGR) could climb to 20.4 percent.

Further breaking down these numbers, 2015 saw SaaS and platform-as-a-service (PaaS) combine to form 83.7 percent of all public cloud revenue, while infrastructure-as-a-service (IaaS) rounded out the three major markets with 16.3 percent.

With revenue expected to grow in the public cloud service market by more than 100 percent in the next four years, enterprise organizations are clearly catching on to the benefits of public cloud computing. With an inherent ability to streamline traditionally clumsy IT aspects into agile, scalable and cost-effective products, this impressive growth confirms the technology’s effectiveness. The question then becomes: Which services is enterprise most interested in?

As mentioned earlier, SaaS leads the charge in public cloud services spending, but PaaS and IaaS are coming on strong. Expected to grow at a rate of 30.6 percent and 27 percent, respectively, both PaaS and IaaS are expected to outpace the growth of SaaS. When it comes to public cloud revenue, the U.S. is expected to rake in the lion’s share — two-thirds — with Western Europe hot on its heels.

For organizations looking to invest in cloud services, a strong look should be given to PaaS. The reason? Mobile’s continued influence on all aspects of modern business. The ability to transform mobile development and deployment into automated, scalable processes has pushed PaaS into the forefront of enterprise cloud initiatives.

As noted in the IT Biz Advisor article above, leveraging all three services in tandem allows organizations to focus more on core business objectives and less on enablers like IT. With the predicted growth of public cloud services, enterprises should find themselves with more opportunities than ever to do exactly that.

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About The Author

Joe Hewitson

News Writer

With a degree in Applied Computing Technology and over a decade of service in the IT and Software Development industries, Joe Hewitson has acquired a keen ability to write about emerging technologies and the impact they have on businesses in many different industries. Accompanying his love for all things tech is a passion for writing informed and engaging pieces in a unique and easy to understand voice. Living in the beautiful arms of the Rocky Mountains, Joe is an avid outdoorsman and enjoys running, biking, and fishing.