Cloud IaaS revenue will top $150 billion in 2023, says Frost & Sullivan
Demand for cloud computing infrastructure as a service (IaaS) is expected to drive the current $45.6 billion market toward $150.7 billion by 2023 - that's a compound annual growth rate of 27 percent, according to the latest worldwide market study by Frost & Sullivan.
Enterprises are using cloud services for strategic benefits such as supporting digital transformation efforts rather than for tactical ones, like reducing IT infrastructure costs and the hardware or software maintenance burden.
This market shift has changed the way enterprises choose and manage their IT infrastructure, and led them to deploy applications across multiple infrastructures, from on-premises private cloud to public cloud (multi- and single-tenant), resulting in higher demand for IaaS offerings.
Hybrid multi-cloud market development
"As the mix of deployment models and best-of-breed cloud IaaS vendors becomes increasingly diverse, single-tenant IaaS will gain revenue share over multi-tenant services," said Maiara Munhoz, senior industry analyst at Frost & Sullivan.
Meanwhile, the emergence of cloud brokerage and cloud management platforms is boosting the trend of hybrid and multi-cloud deployment strategies, making managed cloud services providers key in supporting enterprises and their CIO or CTO requirements.
Frost & Sullivan analysts believe that managed service providers (MSPs) will support their customers with workload assessment and placement, workload migration, and hybrid cloud integration.
The North America region continues to be the most mature cloud IaaS market globally, followed by EMEA, but they are expected to gradually make room for the APAC and LATAM regions.
Some countries in APAC, such as Japan and Australia, are more mature, while India, China, Singapore, South Korea, and Hong Kong are fast-growing markets.
Outlook for cloud IaaS applications growth
Going forward, it will be essential for vendors of cloud computing IaaS to invest in integrated services, on-premises and in the public cloud. For further growth opportunities, vendors should:
- Offer more advanced services in the cloud -- such as containers and serverless architecture -- and tools for enterprises to manage, analyze, and act on their data
- Support hybrid deployment models, as enterprises realize that a single cloud or deployment model will not address all their application requirements
- Partner with MSPs to deliver training, programs and features to support them
- Invest in educating clients on cloud computing technology, as enterprises still need guidance on how to use cloud services to meet goals for business innovation and digital transformation
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