As more organizations adopt cloud-first strategies, new research from Gartner has revealed that the global public cloud market is projected to grow by 17.5 percent in 2019 to reach a total of $214.3bn, up from $182.4bn last year.
Cloud system infrastructure services, more commonly referred to as infrastructure as a service (IaaS), is the fastest-growing market segment and the firm forecasts that IaaS will grow by 27.5 percent this year to reach $38.9bn.
Cloud application infrastructure services, or platform as a service (PaaS), will see the second-highest growth rate at 21.8 percent.
Research vice president at Gartner, Sid Nag explained why the cloud services industry is growing at such a breakneck pace, saying:
“Cloud services are definitely shaking up the industry. At Gartner, we know of no vendor or service provider today whose business model offerings and revenue growth are not influenced by the increasing adoption of cloud-first strategies in organisations. What we see now is only the beginning, though. Through 2022, Gartner projects the market size and growth of the cloud services industry at nearly three time the growth of overall IT services.”
Shifting from cloud-first to cloud-only
More than a third of organizations see cloud investments as a top three investing priority according to recent surveys from Gartner and this has significantly impacted market offerings.
The firm expects that by the end of this year, over 30 percent of technology providers’ new software investments will shift from cloud-first to cloud-only.
As a result, license-based software consumption will plummet further while SaaS and subscription-based cloud consumption models continue to rise.
Spending on cloud-related services, such as cloud consulting, implementation, migration and managed services, currently makes up 19 percent of organization’s cloud budgets but Gartner expects this rate to rise to 28 percent by 2022.