Worldwide public cloud services in 2013 reached a total market size of $45,7-billion – and this is expected to grow at a compound annual growth rate (CAGR) of 23% until 2018.
This is according to the International Data Corporate (IDC) Worldwide Semiannual Public Cloud Services Tracker.
“We are at a pivotal time in the battle for leadership and innovation in the cloud. IDC’s Public Cloud Services Tracker shows very rapid growth in customer cloud service spending across 19 product categories and within eight geographic regions. Not coincidentally, we see vendors introducing many new cloud offerings and slashing cloud pricing in order to capture market share. Market share leadership will certainly be up for grabs over the next two to three years,” says Frank Gens, senior vice-president and chief analyst at IDC.
Three major product groups comprise the total public cloud services market in IDC’s software taxonomy: software as a service (SaaS), platform as a service (PaaS), and infrastructure as a service (IaaS).
The SaaS market – accounting for 72% of the total public cloud services market and forecast to grow at a 20% CAGR over the forecast period – is dominated by Enterprise Applications cloud solutions such as enterprise resource management (ERM) and customer relationship management (CRM), followed by Collaborative applications.
System Infrastructure Software cloud solutions – the other major part of the SaaS market, including Security, Systems Management, and Storage Management cloud services – drove 21% of the 2013 SaaS market.
From a competitive perspective, the SaaS service provider ecosystem is largely led by Salesforce.com followed by ADP and Intuit. Traditional software vendors Oracle and Microsoft hold the fourth and fifth positions, respectively.
The PaaS market – accounting for 14% of the market in 2013 with a forecast CAGR of 27% – is composed of a wide variety of highly strategic cloud app development, deployment, and management services. In 2013 and 2014, PaaS spending has been largely driven by Integration and Process Automation solutions, Data Management solutions, and Application Server Middleware services.
From a market share standpoint, the 2013 PaaS market was led by Amazon.com, followed by Salesforce.com and Microsoft (both share the number 2 position). GXS and Google hold the fourth and fifth positions, respectively.
The Infrastructure-as a service (IaaS) market – comprised of two major segments, Server and Basic Storage – drove $3.6-billion in 2013 spending and is projected to grow at a 31% CAGR through 2018. The top five vendors in this market are Amazon.com (which holds the first position with more than 40% of market share), RackSpace, IBM, CenturyLink, and Microsoft.
On a regional basis, the US holds almost 68% of the market which is much more than what it holds for traditional technologies. Western Europe holds 19% and the other six regions IDC tracks hold 5% or less each. However, IDC forecasts that by 2018, the U.S. share will drop to 59%, while the Western European share will grow to 23%. Emerging regions are also expected to grow above worldwide average.