The cloud cover in the tech world is getting thicker. Cloud computing usage continues to rise and this brings healthy jumps in revenue for the providers. Gartner has recently forecast that the worldwide public services market is poised to grow by 17% in 2020 alone.
This would mean that it will rise to $266.4 billion from $227.8 billion in 2019. A more detailed look at the segments shows that Gartner expects all major types of cloud services to net gains over the next three years. As a result, in 2022 the total public cloud service market can reach $345.6 billion. This means we are poised for several years of a very active cloud service market which is just getting started.
Lots of services to choose from
Gartner eyes five main types of cloud services. The Cloud Application Services (aka Sofware-as-a-Service) will remain the biggest one. It will reach $116 billion in 2020. The second largest market is the Cloud System Infrastructure Services (aka Infrastructure-as-a-Service). It will reach $50 billion in 2020. This means that it’s also quite behind SaaS.
The Cloud Business Process Services (aka Business-Process-as-a-Service) will reach $46.9 billion in 2020. Up next are the Cloud Application Infrastructure Services (aka Platform-as-a-Service). Gartner expects this market to reach $39.7 billion in 2020. Last but not least, we have the Cloud Management and Security Services. They will have a modest by comparison $13.8 billion revenue in 2020.
Out of all of them IaaS will net the highest growth – 24% year over year. Gartner expects that IaaS will continue to outpace the overall market as demands for high workloads rise and traditional data centers struggle to meet them. The growth will continue as companies increase their reliance on cloud technologies, Gartner adds.
Cloud investments to increase
Another survey by Gartner shows that IT budgets for enterprises will largely remain flat over 2020, scoring growth between 0.9% and 2.8%. CIOs are looking for ways to optimize spending and the cloud will enjoy increased spending at the cost of other venues.
“The cloud managed service landscape is becoming increasingly sophisticated and competitive. In fact, by 2022, up to 60% of organizations will use an external service provider’s cloud managed service offering, which is double the percentage of organizations from 2018. Cloud-native capabilities, application services, multicloud and hybrid cloud comprise a diverse cloud ecosystem that will be important differentiators for technology product managers. Demand for strategic cloud service outcomes signals an organizational shift toward digital business outcomes”, says Sid Nag, research vice president at Gartner in a release.
It’s going to be a very dynamic time for cloud service providers. The increased demand means they will also have to act and adapt more quickly. Otherwise they will risk driving potential clients away towards the competitors if they can’t offer the desired capabilities.