The worldwide public cloud services market is projected to grow 21.4 percent in 2018 to total $186.4 billion, up from $153.5 billion in 2017, according to Gartner. The fastest-growing segment of the market is Cloud Infrastructure-as-a-Service (IaaS), which is forecast to grow 35.9 percent in 2018 to reach $40.8 billion.
“The increasing dominance of the hyperscale IaaS providers creates both enormous opportunities and challenges for end users and other market participants,” said Sid Nag, research director at Gartner. “While it enables efficiencies and cost benefits, organizations need to be cautious about IaaS providers potentially gaining unchecked influence over customers and the market. In response to multi-cloud adoption trends, organizations will increasingly demand a simpler way to move workloads, applications, and data across cloud providers’ IaaS offerings without penalties.”
SaaS Delivery Model
Software-as-a-service (SaaS) remains the largest segment of the cloud market, with revenue expected to grow 22.2 percent to reach $73.6 billion in 2018. Gartner expects SaaS to reach 45 percent of total application software spending by 2021.
“In many areas, SaaS has become the preferred delivery model,” added Mr. Nag. “Now SaaS users are increasingly demanding more purpose-built offerings engineered to deliver specific business outcomes.”
“Although these large vendors have different strengths, and customers generally feel comfortable that they will be able to meet their current and future needs, other dbPaaS offerings may be good choices for organizations looking to avoid lock-in,” added Mr. Nag.
Public cloud revenue is growing more strongly than initially forecast, but Gartner still expects growth rates to stabilize from 2018 onward, reflecting the increasingly mainstream status and maturity that public cloud services will gain within a wider IT spending mix.