Global cloud services spending for the largest five industry groups – healthcare, public sector, finance, retail/wholesale, and manufacturing – is expected to show accelerated growth in 2019, relative to 2018, according to IDC’s latest release of their Worldwide Semiannual Industry Cloud Tracker. Three of the five industry segments – finance, manufacturing and retail/wholesale – are growing above the market average of 21.5%.
Worldwide industry cloud spending in 2018 and expected growth for 2019, according to IDC’s latest report, is as follows:
2018 Finance cloud spend – $7.3; 2019 growth – 22.8%
2018 Healthcare provider cloud spend – $12.1; 2019 growth – 20.6%
2018 Manufacturing cloud spend – $3.6; 2019 growth – 26.3%
2018 Public Sector cloud spend – $8.4; 2019 growth – 17.3%
2018 Retail/Wholesale cloud spend – $6.1; 2019 growth – 24.6%
“IDC’s latest forecast shows that industry cloud growth rates will continue to accelerate over the next three years, which is very unusual for multi-billion-dollar markets,” said Frank Gens, Senior Vice President & Chief Analyst at IDC. This growth is being driven by rapidly-digitizing industries like healthcare, financial services, and manufacturing, where industry clouds are becoming the cornerstones for next-generation growth and innovation strategies.”
From a geographic perspective, the United States market will make up close to three quarters of the overall market in 2018, according to IDC. Most of the other regions will enjoy stronger than average market growth with Japan and China expected to grow the most year over year at 54% and 47% respectively. These two countries are also forecast to grow at an even higher annual rate in 2019. The other regions, such as U.S., Latin America, and Middle East & Africa, will also outperform their 2018 growth rates.
Healthcare Industry Cloud
The healthcare provider market in the U.S. is expected to pass the $10 billion mark in 2018 for the first time while the Western Europe market for healthcare industry cloud is also forecast to hit a landmark in 2018 by crossing the $1 billion mark. Relative to all other regions, Japan can be considered a late adopter to industry cloud deployment. Having said that, the region will fast track to pass the $1 billion mark by 2022. Meanwhile, China is expected to reach that landmark two years earlier.
“The industry cloud market continues to accelerate as cloud users demand both vertically-specific capabilities in their solutions and industry expertise from their cloud service providers,” said Zachary Rabel, senior research analyst, Cloud, SaaS, and Industry Cloud research at IDC. “To capture this growth, cloud vendors have increasingly shifted their horizontal capabilities to form industry cloud solutions, while industry clouds themselves have created consortiums of collaboration to drive industry innovation. Healthcare has led industries towards this trend, but the finance, manufacturing, and retail industries have internalized the successes and failures from horizontal platforms to form their own paths. IDC believes the industry cloud market is among the largest vertical growth opportunities for both technology vendors and professional services firms through 2025.”