By: Mike Wolff
New forecast from market intelligence service International Data Corporation sees worldwide spending on public IT cloud services growing at 23.5% compound annual rate from $47.4 billion in 2013 to $107 billion in 2017. That’s five times the growth of the entire IT industry, IDC reports.
“The first wave of cloud services adoption was focused on improving the efficiency of the IT department,” said Frank Gens, IDC senior vice president and chief analyst. “Over the next several years, the primary driver for cloud adoption will shift from economics to innovation as leading-edge companies invest in cloud services as the foundation for new competitive offerings. The emergence of cloud as the core for new ‘business as a service’ offerings will accelerate cloud adoption and dramatically raise the cloud model’s strategic value beyond CIOs to CXOs of all types.”
Business Innovation, Industry Transformation
“In this second phase of cloud development,” Gens continues, “it will be essential for cloud services providers to reexamine their cloud strategies, preparing for a marketplace focused intensely on business innovation, industry transformation, and increasingly pressured pricing and operating models. How suppliers navigate the next two years will tell us a lot about who the IT market leaders will be for the next two decades.”
IDC expects public IT cloud services will be driving 17% of IT product spending by 2017 and nearly half of all growth across five technology categories: applications, system infrastructure software, platform as a service (PaaS), servers, and basic storage. Software as a service (SaaS) will remain the largest public IT cloud services category throughout the forecast, capturing 59.7% of revenues in 2017.
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