Public cloud services will be a $204bn market in 2016

The public cloud services market will rise in 2016 and is expected to grow its worth to $204 billion (£142bn), up from $175bn (£122bn) in 2015, Gartner has reported.

Gartner research director Sif Nag said that the 16.5 percent increase underscores the huge demand for outsourced cloud services in businesses across all verticals as they convert legacy IT services to cloud-based services "due to the increased trend of organizations pursuing a digital business strategy".

Among public cloud services, infrastructure-as-a-service offerings is forecasted to contribute to the bulk of the growth, with an expected 38 percent increase, or about $22.4 billion (£15.6bn), which is highly-attributed to companies’ goal of cutting down datacenter costs.

"IaaS continues to be the strongest growing segment as enterprises move away from data centre build-outs and move their infrastructure needs to the public cloud", Nag said.

Meanwhile, the biggest area of spending will also be seen in cloud advertising which will account for $90 billion (£62bn) of the market, as firms will be seen to buy ad space on sites, based on user profiles in real-time.

In addition to these, software-as-a-service application, cloud security service and Platform-as-a-service offerings are also expected to grow.

SaaS is expected to attain a 20 percent growth, or $37.7 billion in sales, in 2016; cloud security services will account for $6.2 billion, compared to $5 billion in 2015; and PaaS will account for $4.6 billion, compared to $3.8 billion in 2015.

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