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Gartner: 2017 public cloud services market to surge 18 percent

24 Feb 2017

The global public cloud services market will continue its rapid growth throughout 2017.

That’s according to Gartner, who have projected the market to grow 18 percent in 2017 to a total of US$246.8 billion, up from $209.2 billion in 2016.

The highest growth is expected to come from cloud system infrastructure services (IaaS), which is projected to grow a whopping 36.8 percent in 2017 to reach $34.6 billion. Meanwhile, cloud application services (SaaS) is expected to grow 20.1 percent to reach $46.3 billion.

Research director at Gartner, Sid Nag says the overall global public cloud market is entering a period of stabilisation, with its growth rate peaking at 18 percent this year and then tapering off over the next few years.

"While some organisations are still figuring out where cloud actually fits in their overall IT strategy, an effort to cost-optimise and bring forth the path to transformation holds strong promise and results for IT outsourcing (ITO) buyers,” says Nag.

“Gartner predicts that through 2020, cloud adoption strategies will influence more than 50 percent of IT outsourcing deals."

With a focus closer to home, the public cloud services market in Australia is forecast to reach A$6.5 billion, up 15 percent from last year. The highest growth will come from SaaS, which is projected to grow 25.9 percent in 2017 to reach A$1.85 billion. IaaS is expected to grow 14.4 percent to reach A$476 million.

China’s cloud service market is expected to record significant growth, as while it is still 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.

"Organisations are pursuing strategies because of the multidimensional value of cloud services, including values such as agility, scalability, cost benefits, innovation and business growth," says Nag.

"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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