The public cloud services revenue rose 28.6 percent in the first half of 2017 to $63.2 billion, according to IDC.
“Public cloud adoption is accelerating in large part as enterprises recognize that the cloud has become the launchpad for virtually every new IT innovation in the last 24 months – including AI, blockchain, quantum computing and more. Organizations not on the public cloud will be increasingly isolated from the world of tech innovation,” said Frank Gens, senior vice president and chief analyst at IDC.
Public cloud services revenue increased 38.9 percent in Asia Pacific, representing 11.5 percent of all public cloud services revenues. China achieved 55.6 percent year-over-year growth in public cloud services revenue in the first half of 2017.
Among the three primary segments of public cloud services (SaaS, PaaS and IaaS), the SaaS segment, which holds 68.7 percent of overall market share, was the slowest growing segment with a 22.9 percent growth rate.
“Many companies have picked the low-hanging fruit, in terms of apps that could be easily moved to the cloud, and are now evaluating the migration of their next set of larger strategic systems (i.e. ERP, supply chain applications, etc.) to a SaaS model,” said Eric Newmark, program vice president for IDC’s SaaS, Enterprise Applications, and Industry Cloud research practices.
The smallest segment was PaaS with a 13.6 percent of the public cloud services market. The PaaS market grew at 50.2 percent.
“The adoption of container technology in the PaaS segment has given developers additional tools to accelerate application development and deployment that is important in the enterprise digital transformation journey,” said Larry Carvalho, research manager, PaaS.
The IaaS segment represented 17.8 percent of the public cloud services market, growing at 38.1 percent.
Amazon Web Services (AWS) leads this segment in market share and growth. The last three years have seen a resurgence of focus on public cloud IaaS by major technology companies. Notable among these are major technology players like Microsoft, Google, Oracle, IBM, Fujitsu, Alibaba, and Huawei.
Deepak Mohan, research director, Infrastructure as a Service (IaaS) at IDC, said recent introductions into the market, like Azure Stack and VMware Cloud on AWS, also enable easier hybrid IT models and reduce the barrier to cloud adoption for enterprises.
According to our OpenStack Pulse 2017 report, service providers with OpenStack private cloud revenue will exceed revenue from service providers with OpenStack-based public cloud implementations in 2018. OpenStack revenue will exceed $6bn by 2021, as it experiences a growth rate of 30 percent CAGR.
“OpenStack has solidified its position as the leading open source option for building private and public cloud environments but it is no longer the shiny new toy in the industry – that torch has been passed to containers and microservices,” said Al Sadowski, research vice president at 451 Research.
