Gartner: Public cloud market to reach $246bn in 2017 with IaaS and SaaS at forefront

James has more than a decade of experience as a tech journalist, writer and editor, and served as Editor in Chief of TechForge Media between 2017 and 2021. James was named as one of the top 20 UK technology influencers by Tyto, and has also been cited by Onalytica, Feedspot and Zsah as an influential cloud computing writer.

First IDC made its forecast on the public cloud, and now Gartner has done likewise, predicting that public cloud services market will grow 18% in 2017 to total $246.8 billion (£198.1bn).

IDC’, by comparison, said global spending on public cloud services and infrastructure would reach $122.5bn by the end of this year with seven out of eight primary geographic regions to record CAGRs of more than 20% in the next five years.

Outside of ‘cloud advertising’ – “cloud-based services that support the selection, transaction and delivery of advertising and ad-related data”, according to the analysts – the largest market in 2017 will be software as a service (SaaS), in line with IDC’s predictions. SaaS will overtake BPaaS, cloud business process services this year, while infrastructure as a service (IaaS) will grow to $34bn this year.

By 2020, SaaS will be at $75.7bn, IaaS at $71.5bn, and PaaS at $56.1bn, comprising a total market of $383.3bn, Gartner adds. Growth in the infrastructure compute service space will be enhanced by artificial intelligence (AI), analytics and the Internet of Things (IoT), while the growth of PaaS will also drive the growth of IaaS.

Again, as IDC mentioned, North America is the primary market; more than half of application adoption in the continent will be SaaS or otherwise cloud-related. Gartner also focused on China at a national level, whose forecast was increased to account for anticipated higher buyer demand, saying that ‘while it was nascent and several years behind the US and European markets, it is expected to maintain high levels of growth as digital transformation becomes more mainstream over the next five years.’

“Organisations are pursuing strategies because of the multidimensional value of cloud services, including values such as agility, scalability, cost benefits, innovation and business growth,” said Sid Nag, Gartner research director. “While all external-sourcing decisions will not result in a virtually automatic move to the cloud, buyers are looking to the ‘cloud first’ in their decisions, in support of time to value impact via speed of implementation.”

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