Worldwide revenues from public cloud services is expected to hit $96.5 billion by the end of this year, a new forecast by the International Data Corporation (IDC) has shown.
[quote font=”georgia” font_size=”22″ font_style=”italic” align=”left” arrow=”yes”]According to IDC, “by 2020, about half of all new business software purchases will be of service-enabled software, and cloud software will constitute more than a quarter of all software sold.”[/quote]The forecast document, ‘Worldwide Semiannual Public Cloud Services Spending Guide’ also reveals that revenues from public cloud services across the globe will be more than $195 billion in 2020, making more than double the revenues forecast for 2016.
IDC says there will be a compound annual growth rate (CAGR) of 20.4% over the 2015-2020 forecast period.
Industries leading the way in public cloud services spending are discrete manufacturing, banking, and professional services, representing nearly a third of total worldwide revenues in 2016, according to authors of the document.
The document also reveals that industries that will see the fastest revenue growth over the five-year forecast are media, telecommunications and retail.
According to the technology research company, cloud software services, which include applications as a service, system infrastructure software (SIS) as a service (SaaS), and application development and deployment (AD&D) or platform as a service (PaaS), was responsible for 83.7% of all public cloud revenue in 2015, with the remaining 16.3% belonging to infrastructure as a service (IaaS).
IDC however forecast that in 2016, Infrastructure as a Service (IaaS) and Platform as a Service (PaaS) revenues will grow at a faster rate than SaaS, expanding their share of overall revenues in the process.
Benjamin McGrath, Senior Research Analyst, SaaS and Business Models says that “cloud software will significantly outpace traditional software product delivery over the next five years, growing nearly three times faster than the software market as a whole and becoming the significant growth driver to all functional software markets.”
According to IDC, “by 2020, about half of all new business software purchases will be of service-enabled software, and cloud software will constitute more than a quarter of all software sold.”
Eileen Smith, Program Director, Customer Insights and Analysis, said Cloud computing is breaking down traditional technology barriers as line of business leaders and their IT organizations rely on cloud to flexibly deliver IT resources at the lower cost and faster speed that businesses require.
“Organisations across all industries are now free to adapt to market changes quicker and take more risks, as they are no longer bound by legacy IT constraints,” he adds.