According to Gartner’s latest forecast, the worldwide public cloud revenues are set to hit $260 billion by the end of 2017, up from $219.6 billion in 2016. That shows year-on-year growth of 18.5%. The software as a service (SaaS) and Infrastructure as a Service (IaaS) are the two fastest growing segments in the cloud services market.
SaaS revenue might grow by 21%, to $58.6 billion in 2017. The rapid growth in SaaS is due to providers delivering more applications and add-ons as a service. These SaaS solutions, designed for specific purposes, can often provide businesses the better outcomes than traditional software.
“Strategic adoption of platform as a service (PaaS) offerings is also outperforming previous expectations, as enterprise-scale organizations are increasingly confident that PaaS will be their primary form of application development platform in the future,” said Mr. Nag, research director at Gartner. “This accounts for the remainder of the increase in this iteration of Gartner’s public cloud services revenue forecast.”
IaaS category will show the highest revenue growth, predicted to rise 36.6%, to $34.7 billion in 2017.
Even though the public cloud revenue is showing major growth in 2017, Gartner predicted that it might stabilize from 2018 onwards as cloud is becoming more mainstream.
“As of 2016, approximately 17 percent of the total market revenue for infrastructure, middleware, application and business process services had shifted to cloud,” said Mr. Nag. “Through 2021, this will increase to approximately 28 percent.”
The leading public cloud providers such as AWS, Microsoft Azure, and Alibaba Cloud might be the topmost recipients of public cloud revenue growth in IaaS category, with 70% of total spending on cloud services through 2021 dominated by top 10 cloud providers.
“In the SaaS and PaaS segments, we are seeing cloud’s impact driving major software vendors such as Oracle, SAP and Microsoft from on-premises, license-based software to cloud subscription models,” added Mr. Nag.
The additional analysis on data center and IT operations trends will be provided at the Gartner Global Infrastructure & Operations events from 27-28 November in London,4-7 December in Las Vegas, and 15-17 May in Orlando.