Public cloud services market will reach $246.8 billion in 2017

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The global public cloud services market is expected to grow 18 percent this year, according to Gartner’s latest report. Totaling $246.8 billion (up from $209.2bn last year), the growth will mostly come from IaaS, which is expected to grow 36.8 percent and reach $34.6 billion.

The growth will also be fueled by SaaS (20.1 percent increase, to $46.3 billion).

"The overall global public cloud market is entering a period of stabilization, with its growth rate peaking at 18 percent in 2017 and then tapering off over the next few years," says Sid Nag, research director at Gartner. "While some organizations are still figuring out where cloud actually fits in their overall IT strategy, an effort to cost optimize and bring forth the path to transformation holds strong promise and results for IT outsourcing (ITO) buyers. Gartner predicts that through 2020, cloud adoption strategies will influence more than 50 per cent of IT outsourcing deals."

SaaS offerings will mature in the years to come, which will result in a somewhat slower growth over the next few years. This is mostly related to human capital management and customer relationship management, as well as the increase in buying of financial applications.

Despite its maturing, SaaS is expected to remain the second largest segment in the market.

"As enterprise application buyers are moving toward a cloud-first mentality, we estimate that more than 50 per cent of new 2017 large-enterprise North American application adoptions will be composed of SaaS or other forms of cloud-based solutions," adds Nag. "Midmarket and small enterprises are even further along the adoption curve. By 2019, more than 30 percent of the 100 largest vendors' new software investments will have shifted from cloud-first to cloud-only."

Published under license from ITProPortal.com, a Future plc Publication. All rights reserved.

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