Investment in all the various types of cloud computing has gone gangbusters in recent years, and for good reason: Cloud computing helps to cut cost, shorting time to market, provides unrivaled scale and reliability.
This will only continue as enterprises continue to divest from on-premises infrastructure over the long term while seeking to scale the tremendous data generated by AI, IoT, machine learning and digital transformation. It looks as though for the few years ahead, it’s nothing but tailwinds for cloud investment and growth.
According to research firm Gartner Inc., the software-as-a-service (SaaS) market reached $48.2 billion in 2016, growing more rapidly than the firm previously projected—although Gartner didn’t say in the release what its previous revenue prediction had been.
Currently, Gartner expects the total worldwide public cloud services market to grow 18.5 percent in 2017 to reach $260.2 billion. That’s up considerably from $219.6 billion in 2016.
According to Gartner, SaaS revenue is expected to grow 21 percent this year to reach $58.6 billion. “The acceleration in SaaS adoption can be explained by providers delivering nearly all application functional extensions and add-ons as a service. This appeals to users because SaaS solutions are engineered to be more purpose-built and are delivering better business outcomes than traditional software is,” Gartner writes.
The highest-revenue growth will come from cloud system infrastructure-as-a-service, which Gartner says is projected to grow 36.6 percent in 2017 and hit $34.7 billion.
Cloud Mojo Keeps on Rising
Cloud is only going to continue to take a greater share of overall spend in the years ahead. According to Sid Nag, research director at Gartner, last year about 17 percent of the total market for infrastructure, middleware, application and business process services shifted to cloud, and by 2021, that will rise to 28 percent.
Those looking at trends outside of cloud won’t be surprised to see cloud growing so much greater than that of the overall global economy. According to research firm IDC, worldwide information and communications technology (ICT) is set to rise over the next five years, fueled by IoT, robotics, augmented and virtual reality, cognitive computing and artificial intelligence.
Total ICT spending on traditional IT, telecom services and new technologies will grow to $5.6 trillion by 2021 from $4.3 trillion in 2016, representing a compound annual growth rate of 6 percent in constant currency terms. Annual growth will accelerate through the forecast period, to 6.5 percent in 2021 from 5.5 percent in 2017, as new technologies account for a growing proportion of the overall market, IDC writes.
Of course, all of this will increase investment in security and, according to a recent report from Markets and Markets, the cloud security marketing, including identity, data leak prevention, intrusion detection/prevention systems, encryption and security information and event management systems. According to Markets and Markets, the cloud security market will grow to $12.73 billion by 2022, up from only $4.09 billion in 2017.