IDC Study: Enterprise Adoption Driving Strong Growth of Cloud Infrastructure-as-a-Service (IaaS)

Public cloud Infrastructure-as-a-Service (IaaS) offerings are rapidly gaining acceptance among enterprises as a viable alternative to on-premises hardware for IT infrastructure, according to a recent IDC study. This survey of over 6,000 IT organizations found that nearly two thirds of the respondents are either already using or planning to use public cloud IaaS by the end of 2016. IDC forecasts public cloud IaaS revenues to more than triple, from $12.6 billion in 2015 to $43.6 billion in 2020.

The public cloud IaaS market grew 51% in 2015. IDC expects this high growth to continue through 2016 and 2017 with a CAGR of more than 41%. The growth rate is expected to slow after 2017 as enterprises shift from cloud exploration to cloud optimization. In addition, alternatives such as managed private cloud will grow in maturity and availability, providing IT organizations more options as they plan their infrastructure transformation.

idc cloud research“Public cloud services are increasingly being seen as an enabler of business agility and speed,” said Deepak Mohan, research director, Public Cloud Storage and Infrastructure, IDC. “This is bringing about a shift in IT infrastructure spending, with implications for the incumbent leaders in enterprise infrastructure technologies. Growth of public cloud IaaS has also created new service opportunities around adoption and usage of public cloud resources. With changes at the infrastructure, architectural, and operational layers, public cloud IaaS is slowly transforming the enterprise IT value chain.”

For many enterprises, a hybrid infrastructure mixing existing IT infrastructure with cloud infrastructure represents the optimal path to public cloud IaaS adoption. In fact, hybrid cloud infrastructure is already a common pattern at several large enterprises and IDC predicts that 80% of IT organizations will be committed to hybrid architectures by 2018.

From a worldwide perspective, a number of regional public cloud services have emerged in the last two years. A majority of these are based on OpenStack, which has lowered the barrier for creation and set up of new cloud services. IDC expects to see continued growth in regional public cloud service providers, driven by regulatory and data sovereignty concerns, and increasing demand for local alternatives to the global public cloud service providers.