Public Cloud Spending Grows to New Heights, Study Finds

By: Joe Hewitson| - Leave a comment


It should come as no surprise that the public cloud is a growing market. What may be surprising, however, is just how much growth has been going on. According to a recent study by Synergy Research Group, the public and private cloud markets are keeping a blistering pace that has catapulted them ahead of traditional, noncloud spending.

Synergy Research Group’s study examined the spending numbers between the second quarters of 2015 and 2017. What they discovered was that both public and private cloud spending showed growth — 35 percent and 16 percent, respectively — while spending on traditional data center infrastructure fell as much as 18 percent. Combined, all three sectors account for over $30 billion spent in Q2 of this year, the study reports.

Public Cloud Spending Soars

What’s driving this growth? Spending on servers, storage and networking along with operating system and virtualization software accounted for an overwhelming 96 percent of the Q2 2017 data center market. That said, John Dinsdale, chief analyst and research director at Synergy Research Group, notes that much of the growth is coming from the increasing preference for cloud-based infrastructure over on-site data centers.

“With cloud service revenues continuing to grow by over 40 percent per year, enterprise software-as-a-service revenue growing by over 30 percent and search/social networking revenues growing by over 20 percent, it is little wonder that this is all pulling through continued strong growth in spending on public cloud infrastructure,” Dinsdale says in the official press release.

As impressive as these growth trajectories are, it’s important not to forget what’s going on behind the scenes. Cloud services, both public and private, still run on data center hardware. From that angle, the data center isn’t singing its swan song but simply shifting gears. Expect cloud spending to continue trending upward as companies seek agility and efficiency from their IT investments.

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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.