According to Gartner forecasts, companies moving beyond the pilot stages of using cloud computing will spend nearly $500 billion worldwide this year.
Gartner predicts global spending on public cloud services will be $494.6 billion this year, driven by both the growth of cloud-native infrastructure services and the trend towards work scenarios hybrids, favored by the pandemic. This is a 20.4% increase from $410.9 billion in sales in 2021, just below the 21.2% growth to $599.8 billion that Gartner projects for 2023. Due to the maturation of core cloud services, enterprises have moved beyond the slack stage and are now focusing on capabilities that have the potential to affect digital business and business operations.
“CIOs have moved beyond the era of irrational exuberance in acquiring cloud services and are choosing public cloud providers thoughtfully to achieve specific and desired business and technology outcomes in their transformation digital,” said Sid Nag, research vice president at Gartner. “Public cloud services have become so integrated that providers are now forced to address social and political challenges, such as sustainability and data sovereignty.”
IaaS, DaaS and SaaS among the biggest expenses
The strongest spending growth is expected to be in infrastructure as a service (IaaS) – 30.6% this year and another 30.5% next year. Next comes desktop as a service (DaaS), a consequence of the Covid-19 pandemic and the increase in the number of people working from home. This sector is expected to grow by 26.6% this year and 23.7% next year. However, DaaS is also by far the smallest category, with just $2 billion this year, compared to $176.6 billion for software as a service (SaaS) and $91.6 billion for IaaS. And as more companies ask their staff to return to the office, don’t be surprised if DaaS projections are subject to change.
The third largest category in 2022 is expected to be application infrastructure services, or Platform-as-a-service (PaaS), at $109.6 billion. In total, SaaS, IaaS and PaaS will account for 82% of total cloud revenue. According to Sid Nag, the increase in dollars is more attributable to the cost of services than a massive expansion in purchases. “Cloud-native capabilities such as containerization, database PaaS, and artificial intelligence/machine learning contain richer functionality than commoditized compute such as IaaS or Network-as-a-Service,” did he declare. “As a result, they are generally more expensive, which fuels spending growth.” Gartner also pointed out that other product categories, such as hyperscale edge computing and secure access service edge (Sase), are disrupting adjacent markets and forming new product categories, creating additional revenue streams for cloud providers.
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Gartner: Hybrid working drives use of cloud services Computerworld
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